Why Saas Founders need to think about Growth from Day 1

Jun 11, 2022


Narayan Prasath

"Every battle is won before it's ever fought," Sun Tzu wisely proclaimed in 'The Art of War.'

This adage, while centuries old, offers critical insight for today’s SaaS founders: the importance of pre-emptive strategy. In the context of B2B SaaS Marketing, this means victory hinges on embedding growth into every facet of the business from the outset.

Let's look at why prioritizing growth strategy from day one is not just advisable but essential.

Don't be wary, this is not about reckless 'growth at all costs' mantra that often leads to financial pyrotechnics. Instead, our focus is on meticulously crafted growth systems and strategies.

From day one, a SaaS founder’s journey is not just about creating a product but cultivating a growth strategy that intertwines with every aspect of their venture.

Traditionally, the realms of marketing and sales entered the fray post product-market fit, often catalyzed by venture capital infusion.

But why wait for product-market fit or the capital boost to kick-start your growth engine? The modern playbook has changed. Product-Led Growth (PLG) is not just a buzzword; it's a paradigm shift, merging product development and revenue generation into a seamless narrative.

Growth, therefore, deserves equal deliberation alongside product innovation. In this landscape:

  • Product design inherently breeds compounding growth

  • Social dynamics drive exponential expansion

  • Every user interaction is an opportunity for amplification


Growth Isn't an Afterthought - It's Integral

Traditional business models often relegate marketing and sales to post-product development stages. However, in modern B2B SaaS Marketing, especially with the rise of Product-Led Growth (PLG), this sequence is outdated. When growth strategy achieves symbiosis with product development, the results are more organic and sustainable.

Why Growth Strategy Matters from Day One:

  • Survival and Profitability: Data reveals that about 80% of SaaS companies prioritizing growth from the outset surpass the critical five-year survival mark. Conversely, nearly 60% of those who don't, struggle to achieve profitability.

  • Inherent Growth Mechanisms: Modern SaaS offerings often feature built-in growth levers, particularly in self-serve models. This design philosophy embeds growth as a core product attribute.

  • Efficiency in Distribution: Products conceived with distribution in mind tend to be self-propagating, bolstering organic and offline distribution efforts, thereby charting a sustainable growth course.

The first step you can take towards this direction is realizing how your day one decisions impact long-term growth.

Product Design Through the Prism of Growth Loops

As a SaaS founder, your initial focus might naturally gravitate towards perfecting your innovative idea. But if you view your product not just as a solution, but also consider how your users will interact with it, viewing your product through the lens of growth loops, you unlock a crucial perspective.

The lessons from leading startups like Pinterest or the more recent Loom are testament to the efficacy of this approach.

These companies have intertwined their product development and growth strategies as closely as the strands of a DNA double helix. They didn't just stumble upon 'Growth Loops'; they intentionally integrated them into their core. We've explored Growth Loops as a concept more in another article, which provides deeper insights.

For Pinterest, the act of 'pinning' correlates directly to new users discovering and using the platform, creating a perpetual growth loop. Similarly, Loom’s video sharing functionality inherently promotes product distribution across teams, even if only one employee initially adopts it. These mechanisms are not add-ons; they are integral to the product's foundation.

You start to see every user interaction as an opportunity, understanding the compounding effects these interactions can have on your product's growth. Instead of adding growth strategies as an afterthought, embedding them from the start sets you apart. If you wait until launch, it might be too late. This proactive approach is why many Product Managers and Marketers are now ardently adopting Product-Led Growth (PLG) strategies.

As a SaaS founder, recognizing and implementing these growth strategies from day zero is vital for sustainable, long-term success.

Putting on your growth 'goggles' is not just beneficial; it's a superpower. Allowing you to weave growth directly into your Saas product's fabric.

Harnessing Organic and Social Synergy

Cultivating a community and audience is a marathon, not a sprint.

The 'build in public' ethos, popular among micro-SaaS 'indiehackers', exemplifies the power of community engagement and social selling. Incorporating strategies of community building and social selling early in the journey can be transformative.

Imagine this: By the time your Minimum Viable Product (MVP) is ready, you already have a cohort of eager early adopters aka free focus group. It's a dialogue-driven ecosystem. In B2B SaaS, user feedback isn't just valuable; it's pivotal. Offering vital market signals for refinement and course correction.

Your role as a founder transcends coding. It's about narrative crafting, connection forging, and tribe building. This is the essence of modern SaaS strategy: innovation and interaction from day one.

Make this a week 1 action. Initiate conversations, build networks, and foster communities through platforms like Discord, Telegram, or WhatsApp. Choose the medium that resonates with your target audience and aligns with your brand ethos. By doing so, you're not just building a product; you're nurturing a movement.

Growth is not a sequential step; it's a starting point.

Cutting down on CAC and & Capitalizing on Network Effects

Customer acquisition cost (CAC), sustainable growth, and the power of network effects plays a crucial role in determining a company's financial health and market position. When competition intensifies, businesses often witness a spike in CAC, leading them into a costly cycle of dependency on external marketing. This not only prolongs the payback period but also results in a lower return on advertising spend (ROAS), ultimately harming the company's financial well-being. To combat this, a product that inherently promotes its own marketability stands out as a game-changer.

Achieving growth in the SaaS sector extends far beyond the initial user acquisition. Many companies make the mistake of focusing solely on top-of-the-funnel activities, which leads to a temporary surge in growth that cannot be sustained over time. A more effective strategy involves a deeper, comprehensive approach that fosters steady and reliable expansion, nurturing sustainable growth. This means moving beyond just attracting users to creating a solid foundation for long-term success.

Central to this strategy is the concept of network effects, where the value of a product or service increases as more people use it. In the SaaS world, leveraging network effects is not just a beneficial feature but a fundamental driver of growth. Ignoring these effects can trap a startup in a high-cost cycle of customer acquisition. In contrast, products designed to enhance user interactions, collaboration, and integrations can exponentially increase their value and appeal. This growth occurs without a corresponding increase in marketing expenditure, thereby breaking the cycle of external marketing dependency.

A prime example of this approach is the case of Notion. This platform has successfully cultivated an extensive ecosystem of users, creators, and collaborators, which has been instrumental in its remarkable growth. By focusing on templates and dashboards, Notion has unlocked powerful catalysts for expansion. These features exemplify the potential of designing products with virality and shareability in mind, showing how a product can intuitively address its own marketability and, in doing so, drive sustainable growth through the power of network effects.

The key to thriving in the SaaS domain lies in understanding and harnessing these interconnected dynamics to create a product that not only attracts users but also retains them and encourages organic growth.

When you design for virality and shareability, you transform each user into a proactive ambassador, thus amplifying our reach and continuously enhancing product value—a virtuous cycle that paid marketing struggles to match.

Closing notes

B2B SaaS marketing can be tough, with each product facing unique challenges.

Founders often find themselves navigating through a labyrinth of advice, where the true challenge lies in identifying genuine marketing wisdom among a plethora of varying opinions. For technical founders diving into the depths of B2B SaaS and Non-SaaS Marketing, we offer an invitation to engage in meaningful dialogue and discovery. It's a complex path journey, but we can help make it clearer.

Here to share what we know.

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