You’re a company that’s been selling to individuals and/or small to medium-sized businesses for a considerable time now. The issue is, you’ve been wanting to make the move upmarket but aren’t sure if your team, product and company as a whole are in the optimal position to start selling to enterprise. Let’s have a look at a few examples to see the point where other SaaS companies took the leap and why - and how Paddle made its first foray into the world of enterprise too.
Are you ready to sell to bigger businesses?
As our CCO Harrison Rose notes in our Moving to New Markets webinar, Paddle is in the unique position of powering the checkouts of thousands of SaaS companies. We help these companies to scale and, as such, can see how and when they move upmarket.
We’ve noticed that there are two key ways that companies within the SaaS industry move upmarket: reactively and proactively.
The reactive route
All three companies shown above (password management app 1Password, prototyping and design app Framer and brainstorming app MindNote) began life with a self-serve product which required no sales interaction to purchase. They served B2C and small and medium-sized businesses (SMBs) but found that they had to step up to selling to enterprise-level businesses when they received requests from bigger companies to use their product.
1Password, for example, was approached by Apple, who wanted to provide all of their employees with a 1Password licence. This was a massive opportunity for 1Password that prompted a big shift in the way they sell their product, including but not limited to a change in their product plans with the introduction of a family plan for app users.
The proactive route
DropBox, the widely-used file hosting service, and DueDil, a B2B company who make private company data accessible to everyone, took the proactive route to sell to larger organizations. Both companies sell B2C, offering a popular freemium product with the option to upgrade. DueDil noticed that they had a huge number of users signed up to their free product - approximately a quarter of the UK population - and they saw in this an opportunity to sell to larger business. People using a free product usually belong to a bigger organization, and it was this realization that saw both DropBox and DueDil hire sales reps to directly contact customers and sell additional licenses.
Companies who take the proactive path to enterprise tend to tailor plans to the personas they’re targeting, for example offering a business account so that an individual using the freemium product in the workplace can increase their use of the product with their whole team on board. Seizing the opportunity is key and therefore knowing your customer’s requirements is crucial.
We’ve been there too…
How Paddle moved to selling upmarket
Our VP of Sales, Adam Kay, shares how we sold to our first enterprise customer:
“We received an inbound request for a demo of our product from a company that was 30 times larger than Paddle’s biggest client in terms of annual revenue. When they ran some due diligence on the product itself, they said ‘this is the best product we’ve seen in the market’. We then asked ourselves, ‘why aren’t we going after more of these types of companies?’
Whilst a product fit for enterprise is clearly important, just having the product fit is not enough. Selling to larger customers often involves more complex processes, more stakeholders, potentially a different sales approach, appropriate pricing structures and patience!”
What do you need to adapt to begin selling upmarket?
Some infrastructure changes need to be made in order to best position your company for selling to a very different kind of customer, specifically in the following three areas.
It’s important to ensure your product is best positioned for use in larger companies. Think about how the product will be used differently by a team as opposed to individual use. For example, do you need to add features like collaboration and admin roles to enhance the experience of your product?
It’s also likely need to adapt the products your company uses when making the move upmarket. In our experience, it became important that the products we use all have single-server sign-on and integrate with other technologies we use, while advanced reporting and management is another big priority. It can limit your use of tools you used as a smaller startup, but it’s key to adapt when moving upmarket.
Sales and Success
Your Sales and Success teams will need to change in preparation for selling to larger customers. For starters, you’ll need a sales team (if you didn’t already have one) to support the process. A Success team is also very important for onboarding your new customers, retaining them and upselling to them, too. Investing in Sales and Success can be the key to winning and keeping big clients - in our experience of overseeing thousands of checkouts, companies often move upmarket after a fundraise, most likely as they’re able to set up or further build these teams.
Larger customers will want to pay in a different way to the smaller companies you’re used to serving. With larger amounts of money coming your way, it’s very unlikely an enterprise customer will want to put it all on a credit card. Big companies are more likely to want to pay via wire transfer - they want to pay into a bank account that feels local to them over a payment network they’re used to, with the ability to raise a PO and renew licenses with ease. As a company, you’re going to want to accept their payment without issues like currency conversion, which is why a Merchant of Record can help you in your move upmarket.
Ready to take the leap?
If you feel you’re in a strong position to begin selling to the big leagues within the SaaS industry, our eBook provides a 3-step plan to success. Want a preview? Check out our video to discover what you’ll learn from our guide, made by video creation platform Wideo.
What you’ll learn from our eBook:
- What upmarket looks like and how your sales and marketing teams can support the needs of larger customers.
- How to create a customized set of messages that personally target prospects.
- The tools that’ll help you find upmarket businesses and measure success.
- The common problems to avoid when outreaching.