Five avoidable growth mistakes founders miss

Answer these simple questions first before spending $$ on growth.

Hello, I’m Hema, and welcome to my newsletter, First Impression. Each month, I write an in-depth post on positioning, brand, or GTM strategy for early-stage startups. Join startup founders, investors, and practitioners and subscribe to get the newsletter in your inbox.

Efficient growth is top of mind for founders right now. If you are an early-stage B2B startup founder with a product that’s gaining traction, you are probably thinking about getting more customers and growing your top-of-funnel.

Drawing from my journey alongside 25+ startups, I’ve seen founders stumble on five growth pitfalls over and over again. If you haven’t answered these five questions carefully, don’t spend $$ on a growth agency, advertising spree, or content marketing escapades. You might as well flush it down the toilet.

1. What is your Go-to-Market model?

I’m quoting Joel York here — choose the right Go-to-Market (GTM) model, and you will grow smoothly from seed funding to A round to B round and beyond. Choose wrong, and you spend precious cycles chasing your tail and run out of cash.

Here’s the framework York uses, which I’ve used many times to help startups think through their GTM model.

Note: I’ve made some notes and edits to help early-stage startups.

This price/complexity 2x2 is a simple but effective way to determine your GTM model. Average sales price (ASP) puts a ceiling on how much you can afford to spend on customer acquisition costs, which in turn determines the volume of deals/sales. How complex your product is to use is critical in deciding which GTM motion to adopt.

Self-service —Zero sales team. No sales cycle. All PLG with marketing support. Examples: Canva, Loom, Airtable. The goal is to get a lot of users, and some % of them will convert into paying customers. Your product is priced at an affordable price point or has a tiered pricing structure with three or maybe four pricing tiers.

Transactional — Sales assisted. Short sales cycle. Marketing led + product supported. Examples: Intercom, Hubspot, Zendesk. In this model, users can onboard themselves easily and test your product out for a limited time but might need some assistance from inside sales reps. and customer support to leverage it fully.

Enterprise — Sales-led, marketing-supported. Examples: Twilio, Workday, SAP. Typically, high-complexity products cost more and require a high-touch, longer sales cycle with higher ARR.

Needless to say, a high-complexity product at a low price is deadly. So make sure you don’t end up in the startup graveyard!

🚫 Don’t try to do it all at once. Pick a primary GTM model. I cannot emphasize this enough. If you try to do it all simultaneously, you’ll kill your marketing and product teams.

Move from self-service to enterprise too quickly, and you’ll end up with a ton of customer support issues and high churn if you can’t stand up the operational infrastructure to support this motion.

Over time, you’ll be able to layer on different motions, both sales-assisted and sales-led, but hone in on a single GTM model first before you push out into the other models.

I highly recommend reading Joel’s article on SaaS startup strategy, which delves deeper into this framework.

2. Is your user onboarding aligned with your GTM model?

If you choose a freemium PLG model, you better have the slickest, most intuitive, low-friction onboarding à la Miro and Loom. Ask yourself these questions:

1. Is it dead simple for my user to sign up?

2. Does my onboarding flow set them up for early success in using the product?

3. Does it offer in-app tutorials and pop tips during onboarding?

4. How about help articles and tutorials to get users to adopt new features?

5. Does it keep paywalls, credit card, and pricing pages away from the onboarding experience?

This post from

Jaryd Hermann

is an excellent breakdown of how Miro grew with a freemium, PLG motion.

If your GTM model is transactional (free-trial + sales assisted), then your onboarding and user experience must be designed with (a) adoption and (b) conversion in mind. Since this model leans on an inside sales team to close deals, you don’t need the slickest onboarding, but you do need the following:

1. A thoughtful signup experience where you collect the right user information to help your inside sales team.

2. A killer email drip campaign to onboard and nurture free trial users.

3. Carefully designed upgrade prompts and experience.

Don't spend cycles on self-onboarding and in-app upsells if you’ve committed to an enterprise GTM model. It’s a waste of your product team’s time. Focus instead on empowering your sales reps with a killer demo, well-written emails, and eye-popping testimonials.

3. Is your prospecting aligned with your GTM model?

• Freemium model — You’ll need to spend all your resources on inbound marketing. If your product has a low ASP, over 75% of your leads should be inbound. Invest in SEO. Invest in content. Start building a brand from day one! Yes, you can do this without spending gobs of money. Read this post on why B2B SaaS needs a brand.

• Free trial model — Assuming you have a higher ASP or a good mix of customers between your different pricing plans, you can invest more in a thoughtful channel strategy that includes paid advertising, retargeting, promotions, and partnerships. But before you do this, map out your revenue funnel first so that when you turn on these programs, you can fully and accurately measure its impact.

  Emily Kramer of MKT1
  writes about this in her newsletter, how to measure what marketing activities are driving revenue.

• Enterprise model — With higher ASPs, your marketing team should have a bigger budget and more leeway. However, ensure that your channel strategy makes sense for how your product is sold and adopted. For example, if you rely on a particular infrastructure being in place to run your application, like Snowflake or AWS, then it might make sense to be part of their marketplace and invest in building deeper partnerships with them rather than spend $$ on paid advertising.

4. Are you obsessing over the right metrics?

If you’ve chosen a Freemium model, you should obsess over activation rates, DAUs, and MAUs instead of paid conversion rates. The bigger your activation rate and higher the usage, the higher the likelihood of paid conversion.

If you’re using BDRs to close deals, you should obsess over call-to-conversation conversion rate and opportunities/month to track their performance.

By not choosing a GTM motion clearly or focusing on more than one at this early stage, you can obsess over the wrong metric or track a host of metrics that may be red herrings.

5. Is the entire team playing the same GTM game?

I’ve seen this sometimes when founders hire a sales rep because a board member or an advisor told them to. The sales rep attempts to generate leads without the necessary inbound or outbound funnels or operational tooling in place. Meanwhile, the product team is focused on refining the onboarding experience, and the marketing team is dedicated to SEO and content creation 🤯.

Sadly, such misalignment is more common than it should be. This happens because the entire leadership team hasn’t fully committed to a GTM strategy or thoroughly assessed the requirements for rolling it out successfully.

This misalignment also affects other teams, particularly customer support and customer success.

Look at your key metrics. Are you seeing higher churn rates, low activation rates, and deals that take longer to close or extend quarter after quarter? Take a hard look at whether your teams are all working on the same GTM motion.

Sources and recommended reading:

• Chaotic flow, SaaS startup strategy

• Measures of success: SaaS metrics and benchmarks by Open View

• How to measure what marketing activities are actually driving revenue by MKT1

• The top metrics for vertical SaaS companies - excellent overview of all KPIs.