At About $2m in ARR, Every Great Hire Will Be Accretive.

saastr

Screen Shot 2014-07-21 at 2.14.14 PMRecently, I was talking to the CEO of a pretty successful SaaS company doing ~$3m in ARR, growing nicely, in a good space.  Doing just fine.

And he was proud he’d just hired a VP of Sales at a below-market rate.

Dude.  I told him.  That’s a negative.  Because at your size and growth rate, It Just Doesn’t Matter.  If she’s any good.

Because it turns out, once you hit just $2m in ARR, and maybe even much earlier — every great hire will be accretive.  Will make you more money than you pay them in cash.  I guarantee it, in fact.

Let me explain the math.  Let’s assume you are at $2m ARR, to make the math simple:

  • You hire a Great VP of Sales.  Accretive in 90-120 Days.  For say $300k OTE.  A great VP of Sales, within one year, can easily close 20-50% more business…

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