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hhw3h

For the enterprise app:

1) Ensure your ACV is greater than $3000

2) Scale out an outbound prospecting inside sales channel

3) Scale paid ads on top of outbound prospecting

4) Create a promotion strategy/mix for your growing email list

5) Scale content on top of paid ads

6) Ensure $1 into the customer acquisition machine spits out $3.

7) Explore channel partners, affiliates, replacing yourself with a professional management team, or raising growth capital on very founder friendly terms, etc. if you'd like

I help B2B SaaS founders scale to $1M ARR and beyond with outbound prospecting inside sales funnels. If you'd like to learn more, happy to discuss harry [at] convopanda.com

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I always hear the "your LTV To CAC" ratio must be > 3.

Why? Is the assumption that the LTV is spread out over a period of time that such a low ratio would cause a low CAGR?

I'd assume if one's payback period were let's say 2 hours instead of 18 months, one'd be fine with with a LTV/CAC of let's say 1.1. Is my logic correct?

I don't know exactly why the industry has settled on a best practice of specifically 3:1. Good question.

My hunch is it has to do with the opportunity cost of investors. If a startup comes to an investor with a 1.1:1 ratio why would a rational investor invest? They can get that rate of return in less risky asset classes.

As a bootstrapper yes a lower LTV:CAC ratio could in theory be fine. But I would think like an investor. Instead of investing money you are investing your time. It would be better to iterate and tune what you're doing until you're getting a higher return on your time than you would working in a corporate job you could get or, if you do have capital, a higher return than you would get investing in less risky asset classes.

To your point, time to recover CAC is extremely important to bootstrappers. I recommending going after a niche in your market that can afford higher ticket pricing and will jump at annual deals in exchange for (say a 2 month) discount so that CAC is recovered in month 1. This is very doable but requires sales skills which many technical founders don't have. But they are very capable of mastering.

What's the best way to learn sales for a technical founder?

I'm reading "Way of the Wolf: Straight Line System" right now. Hope to try out its framework this month

Learn sales/marketing theory, do mock sales calls, do live sales calls, reflect on what went well and what went poorly on the calls. Keep improving through more repetitions.

Reading books and mock calls do help but nothing replaces the actual act of having real conversations with real prospects and asking for the sale.

Search for Steli Efti on Youtube - got some brilliant videos on getting started with sales.

> "Why? Is the assumption that the LTV is spread out over a period of time that such a low ratio would cause a low CAGR?"

On second thought, my question doesn't make sense. The LTV calculation would have already time-adjusted the revenue. I think the replier's opportunity cost and risk explanation makes more sense

Cool! This is a great list and I will be sure to review. I appreciate it and will definitely try and reach out at some points. Cheers.

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