![]() So if you're doing the rough founder mental math, you know that a million in spend on sales, should produce about 100 deals a year. And the ASP of $10K, you're breaking even year one. And if you're comping your only AE about 100K, fully burdened maybe $115,000, you can predict that a small sales team can maybe produce 18 CW deals a year. Great, you're average, which is probably fine. So, you know your cost per closed won from the SDR standpoint is about $3K. And at some point, you decide that 60% of demos convert to opportunities, and 35% of those close. ![]() Maybe this is high, or low, or it's reasonable. You know from your sales data, you need to pay about $650 for a demo. Why do you have a list of things the startup needs to do? What is the point or the purpose? Which simply means, there's a long list of nice to haves which also might not be true. When founders say, "we're cash poor" or "we don't have a ton of funding", what they mean is they may have a long list of need to haves which they don't have. You can't do what the business needs to be actively pursing an argument in the marketplace. You'll hear one or more of these terms thrown around frequently, and if you're a founder, you should understand things beyond burn rate.įirst, your cash-zero date, is when you can no longer pay vendors.
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