By Philip Lay, Senior Advisor, The Chasm Group LLC Every day since late last year the media has reported on Covid vaccine rollouts to a global audience anxious to gain protection against Covid-19. The early running indicated that the Oxford-Astra Zeneca alliance, would grab the lead, with the pure-play MRNA companies, Biontech (backed by Pfizer) and Moderna following close behind. Then there’s J&J, which employs a similar technology to that of Oxford-AZ. Which vaccine technology and which company stand to win out in the end? I know where I’m putting my money… For the past year the world has waited anxiously for confirmation that newly developed Covid vaccines will help restore some level of normalcy to our daily lives. Clearly there’s nothing like a major existential threat to concentrate the minds of scientists, microbiologists, chemists, pharmaceutical companies, execs, healthcare systems, and governments – let alone each one of us citizens – to find a solution to a global pandemic that to date has infected 125m people and killed almost 3m. In the past six months or so we’ve seen astounding progress in vaccine launches and initial vaccination programs in certain countries, particularly in Israel, the UAE, the UK and the U.S. Every day brings

By Philip Lay, Senior Advisor, The Chasm Group LLC The formulation of the problem is often more essential than its solution, which may be merely a matter of mathematical or experimental skill.” – Albert Einstein “The problem is not the problem, the problem is the way we see the problem.” – Saji Ijiyemi, Don’t Die Sitting In my work with CEOs and their teams in B2B SaaS scaleups as well as mid-sized and larger companies I am constantly surprised by how many of their sales teams are closing small deals of $50k or so in ARR with enterprise-level organizations instead of developing much larger opportunities. One consequence of this apparent lack of ambition is a much slower growth rate for the company, and another is that it can take twice as long to build a profitable revenue engine. In fact, I believe this is partly why B2B SaaS companies tend to take a decade or more to build a profitable revenue stream. In some cases, this problem occurs because AEs are spending much of their time selling to middle management or even lower — whether in IT, line functions, or procurement — to address tactical problems or respond to RFPs. In other cases, it

By Philip Lay, Senior Advisor, The Chasm Group LLC Never let a good crisis go to waste.” – Winston Churchill, while working to form the United Nations after WWII “There is only one winning strategy. It is to carefully define thetarget market and direct a superior offering to that target market.” – Philip Kotler During the depths of the global crisis, a five-year-old mobile banking software startup was struggling to gain a firm foothold in the market and was facing bankruptcy or at best a fire sale for a few million dollars. A few customers had signed up for pilot projects, generating just under $1m in annual revenues for the VC-funded company. The new CEO and their team were targeting 1400 or so banks in North America, but they still weren’t achieving liftoff. Just six months later they had discovered the formula for success, were off and running, and never looked back. How so? After defining their target industry segment (banking) and geographical region (North America), they decided to narrow the target dramatically to a micro-segment within the industry (the top fifty retail banks). They also thought about how to tailor their mobile banking software to enable the move to branch consolidation that banks

By Philip Lay, Senior Advisor, The Chasm Group LLC Tuning Your Strategy for Post-Covid Times   You campaign in poetry. You govern in prose.” – Mario Cuomo, former three-term governor of New York State, 1983-94 If I had an hour to solve a problem, I’d spend 55 minutes thinking about the problem and 5 minutes thinking about solutions.” – Albert Einstein Change does not roll in on the wheels of inevitability but comes through continuous struggle.” – Martin Luther King, Jr.   My purpose here is to clarify why in today’s C19 downturn virtually every tech company needs to have a clear picture of how they fix critical breakages in one or more of their target customers’ business processes. In order to bring this concept to life it sometimes helps to use a metaphor such as the Leaky Pipe, which I’ll describe further down. But let me start by describing what the three quotes above have to do with our key topic. Cuomo quote: It is my belief that tech companies spend too much time rhapsodizing about how they plan to “disrupt” the world – the equivalent here of campaigning in poetry – while they spend far too little time digging into the painful

By Philip Lay, Senior Advisor, The Chasm Group LLC Synopsis: Customer success is a broken promise in 95% of tech companies. CEOs, CROs and sales teams are generally preoccupied with chasing new logos, and scarce CSMs scramble to minimize churn and secure upsells. Frequently, they have no idea about their customer’s business objectives or success criteria. In a downturn like today’s Covid-19 crisis, the risks of cancelled contracts and lost relationships is heightened, just when winning new logos is harder to pull off. This is exactly the time when executives and their customer-facing staff must engage more fully with their major customers – and really help them achieve their desired business outcomes. Don’t celebrate closing a sale, celebrate opening a relationship.” – Patricia Fripp, speaker, author and entrepreneur Customer success is simply ensuring that your customers achieve their desired outcome through their interactions with your company. That’s it.” – Lincoln Murphy, growth consultant, Sixteen Ventures Every company’s greatest assets are its customers, because without customers there is no company.” – Michael Leboeuf, business author & former professor, University of New Orleans For many if not most enterprise SaaS companies, customer success is still a new game, and one they are playing with a weak

By Philip Lay, Senior Advisor, The Chasm Group LLC How can anyone fail to have noticed the sudden prominence of videoconferencing app Zoom since the outbreak of the Coronavirus crisis? Despite facing established competitors like Apple, Microsoft, and Facebook in consumer video-calling and Cisco and Google in videoconferencing at work, Zoom appears to have literally zoomed to the top of the charts in just the past couple of months. What Just Happened? With so many millions of people worldwide now stuck at home to avoid the contagion, we’ve seen a massive surge in demand for ways of connecting with the outside world. Be it in our personal lives, in how we run our business, or even in how world leaders keep governing through the crisis, this is a time when we are all leaning heavily on technology to not only keep us connected but keep us alive. Consequently, TV news announcers and newspaper reporters are increasingly using “Zoom” as a synonym for videoconferencing, something that until recently was only happening in business settings. Until now FaceTime, Skype and WhatsApp have been the predominant video-calling apps for friends and family to stay in touch, but something has changed here too. Thus the work-from-home (WFH) and

Case Study – The rapid rise of mobile banking startup Clairmail   By Philip Lay, Senior Advisor, The Chasm Group LLC   Chasm crossing is not the end, but rather the beginning, of mainstream market development.” “Entering the mainstream market is an act of burglary, of breaking and entering, of deception, often even of stealth.” “To become a going concern, a persistent entity in the market, you need a market segment that will commit to you as its de facto standard for enabling a critical business process.” “One of the most important lessons about crossing the chasm is that the task ultimately requires achieving an unusual degree of company unity during the crossing period.” “You get installed by the pragmatists as the leader, and from then on, they conspire to help keep you there.” – Geoffrey Moore, various quotes on the theme of crossing the chasm into the mainstream market   Sometimes the best company success stories only get to be told through informal anecdotes, press releases, Powerpoint slide decks, or video testimonials. In such situations, only those close to the company really benefit and the key learnings and best practices are never properly learned or leveraged by other entrepreneurs and management teams.

By Philip Lay, Senior Advisor, The Chasm Group LLC Among the thirty founder-CEOs of tech scaleups with whom I have worked over the past year or so, I’ve noticed that a disturbingly high percentage are experiencing or exhibiting signs of burnout, sufficient in some cases to place the continued growth of their respective businesses at serious risk. The companies in my informal “survey” range from $3m to $40m in ARR, with growth rates anywhere between 15% and 100% plus. The vast majority were founded in the 2009–2013 timeframe, so they are between six and ten years old. The majority have been financed through three or as many as four or five rounds of VC/PE funding. Many of them have developed a second and third product offering, and thus may already be veterans of more than one hazardous and nerve-wracking “chasm-crossing” experience, which can severely test the most resilient of founding and executive teams. All of the CEOs in this cohort except two were founders or co-founders of their respective companies; of the two hired-in CEOs, they’ve been in the job for six years and seven years respectively. Most of these individuals are first-time CEOs who, in light of the instant gratification culture in tech

By Philip Lay, Senior Advisor, The Chasm Group LLC “To win a race, the swiftness of a dart Availeth not without a timely start. The hare and tortoise are my witnesses. Said tortoise to the swiftest thing that is, “I’ll bet that you’ll not reach, so soon as I The tree on yonder hill we spy… The race is by the tortoise won. Cries she, “My senses do I lack? What boots your boasted swiftness now? You’re beat! and yet, you must allow, I bore my house upon my back.” The Hare & Tortoise, La Fontaine fable (1668) translated by Elizur Wright, Wikisource I must say that I’m not sure that La Fontaine’s fable of the hare and the tortoise provides a totally apt metaphor for the question I am posing here. However, I think there are definite similarities to the competition between US and UK tech companies. The fable tells the story of a tortoise that, when suitably provoked by a hare, challenges the much faster hare to a race; the cocky hare takes a nap during the race, while the slow and steady tortoise reaches the finish line first. In this scenario the US tech industry is the hare, quick to act

By Philip Lay, Senior Advisor, The Chasm Group LLC One Problem to Avoid at All Costs: Premature Scaling Today there is an abundance of incubators, accelerators, angel investors, and VC firms to help founding teams avoid the many risks of failure and take full advantage of their opportunities as they seek to get their startup business successfully off the ground. Furthermore, various industry experts over the years have provided a roadmap for startups to navigate their way from brilliant idea to nascent business; one recent example is Eric Ries’s Lean Startup framework, which teaches entrepreneurs to develop a “minimum viable product” (MVP), perform systematic iteration as they engage with early customers, and execute strategic pivots where necessary as they seek to prove their product/market fit. However, companies in “scale-up” mode, to use the use the favored lingo of our times, do not yet have a commonly acknowledged framework or clearly defined set of best practices to help them mitigate the risks as they seek to grow from little or no scale to larger scale. B2B SaaS is Very Different from B2C SaaS and Requires a Different Growth Strategy Worse, a Get Big Fast mindset often takes hold among investors and the founding team itself,