347: How To Get To $1 Mm In Revenue With Your Business Today
In today’s episode of The Startup Chat, Steli and Hiten talk about reaching $1 million in revenue in your startup.
Reaching $1 million in revenue for your startup is a number that a lot of entrepreneurs aspire to reach and can seem magical for some. However, reaching this milestone is not easy and sometimes, founders who do, often take it for granted.
In this week’s episode, Steli and Hiten share their thoughts on what it takes to reach a million dollars in annual recurring revenue, strategies to help you reach that milestone and much more.
Time Stamped Show Notes:
00:00 About today’s topic.
00:40 Why this topic was chosen.
02:32 Hiten’s point of view on reaching $1 million ARR.
03:26 Why it’s easier to reach $1 million ARR.
05:38 The MRR of $1 million in ARR.
06:42 Why you need to be charging a lot of money in order to make your math work if you sell to enterprise.
07:04 Why, due to the time it takes to acquire one, it makes no sense to go after large enterprise customers and charge less than you need to.
09:04 The kinds of sales and marketing strategies that are needed to get to SMB.
11:04 General channels for acquiring customers for low-end SMBs.
12:20 Steli’s final thoughts.
3 Key Points:
You need to figure out how to drive enough value so that people will pay a certain amount for your product.
Sales is designed to get to those customers.
If you do the math, it takes a lot of time to acquire an enterprise level customer
Steli Efti: Everybody this is Steli Efti.
Speaker 2: And this is Hiten Shah.
Steli Efti: And in today's episode, we're going to talk about how to get to one million in revenue with your business today. And the reason I wanted top talk about this today is twofold. One, one million is just still a magical number, a number I think a lot of people aspire towards when it comes to maybe their personal finances. But especially when it comes to their business, kind of a big milestone. So I find that there's this incredible hunger out there for people to learn how to cross that milestone, or how to accomplish that. But the other reason that I wanted to talk right now about this is because recently ... I've heard this a few times before over the last few months but it never really clicked. Until I heard it recently, where a friend of mine and I were discussing the traction of a new SaaS company. And the company was sharing their revenue numbers. And they had basically surpassed the one million in ARR, Annual Recurring Revenue within nine months or so. And I was like, "That's actually pretty decent, pretty good." And then my friend said, "Yeah, but you know it's easier than ever before to cross the one million ARR number. Companies do this faster and faster. So this isn't that impressive." And I agreed with him. And we continued the conversation. And afterwards, I had a moment where I thought, "How crazy is it that we're talking about reaching a million becoming easier and easier. And we're talking about it as a negative thing." As if it's like, "One million isn't so special anymore because everybody can do it," versus, talking about it from a perspective of, "Isn't it amazing the you can start a company and reach a million much faster than you used to? And it's mush easier." Which means a lot more people around the world, especially the people that are listening to this podcast that are not necessarily fully dedicated to doing the venture back thing. People that want to run their own companies, self funded, customer funded, and build them and run them the way they want to. It could be incredibly encouraging that it's easier than ever before to reach a million. So either way you want to slice it, I wanted to talk to you about this today. And I'm dying to get your first response on what I just sai...