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We all screw a lot of things up.  But I think the biggest, #1, mistake successful first-time entrepreneurs in SaaS make time and time again these days is they micromanage too long.

I see this again and again, and in SaaS, it’s a real lost opportunity.  I think it’s a byproduct, in part, of the fact that founders are just so much better these days.  So an amazing founder CEO often can also be the VP of Sales, VP of Product, hack Marketing, fly across the globe as the VP of Customer Success, and sometimes, even continue to write some code.   That’s great.  But it’s way, way, way too much for one person to do one day longer than necessary.

That can be great in the very early days if it gets you to your first $1m in ARR.  Even better if it helps you skip a round of financing.  But after you hit Initial Traction …  If you’re serving any of these VP-level roles yourself — the business simply won’t grow as fast as it otherwise would.

My #1 recommendation to do even better as a first-time SaaS CEO: make yourself obsolete by the time you hit $2-$3m ARR.  In every single function.  Sales.  Engineering.  Product.  Marketing.  Customer Success and Support.  Finance.

Even best case, you’ll become a bottleneck all over the place.  And beyond that, it will distract you from focusing on the few things that really will get you to the next level.

Post Initial Traction, once you have built your 1.0 management team — your job there is really just to bring in, and where necessary, backfill the team.  Not to be a role player on that team anymore.

There’s just one of  you.  You have to only do High ROI things.  In SaaS, that means not hacking being a VP of Anything as soon as you hit Initial Traction and can afford to hire a full management team.

Or put differently:

So as soon as you hit Initial Traction — $1-$1.5m in ARR — just STOP.  Take a pause.

Let it go.  Let your VPs do their job as well as they can.  Let them make their mistakes.  Help them, but let it go and trust them to do their job.  Even if some things, in some ways, they do a worse job than you would have.  And if you don’t have real VPs yet — dude.  Go hire them.  Spend 20% or more of your time here.  Stop futzing around on the small stuff.

I know you can do it all, but the whole game in SaaS is getting from $1m to $10m as fast as humanly possible.

That’s the momentum that gets you to $100m and beyond, to the IPO, the Unicorn, and all that.

If you’re the bottleneck, if you’re still taking out the trash at $2m in ARR … you’re going to get there that much more slowly.  It ain’t worth it.

 

 

 ugly org chart from here