- Hey there, Dan Martell here,
serial entrepreneur, investor and creator of SaaS academy.
In this episode, I'm gonna share with you
how to build a strong team for your SaaS business.
This means that you are working less
but getting way more done.
Or at least working on higher-leverage stuff,
and be sure to say to the end
where I'm gonna share with you
how to get access to my high-octane team,
outline the six core functions of your SaaS business
and these specific core strategies that you need
to be holding your leadership team accountable.
Let's get into it.
(upbeat percussive music)
Building teams is probably one
of my favourite topics to share on,
because I really believe that we build the people,
and the people build the business.
But when we're starting off,
and we're that solo entrepreneur,
we're really trying to hire our first
maybe support person or another developer,
whatever it is.
It's really tough to understand
how does the big picture look.
And I know when I started my company Spheric when I was 24,
that was a frustrating part.
I felt like I was always carrying the weak people.
I had some great people,
but we grew to about 30 people in four years.
I was carrying way too many people on my back,
I was working 100 hours a week,
and it was really frustrating.
Even though we had an incredible outcome,
exiting that business and making me financially wealthy,
I feel super blessed for that experience.
I went on to find a different path, a different strategy,
and moving to San Francisco,
building my company Flowtown with my co-founder Ethan.
Scaling that company was dramatically a different experience
in regards to just quality of life,
leverage of my time and the people that I surrounded myself.
And then after that,
building another venture-backed company, Clarity,
raising 1.6 million, scaling that company
to 20 people in the first year,
that was way easier.
Over the years, I've just collected
a bunch of different strategies
that's allowed me to go from just frustrating
people side of the business
to a point now where today,
every team I'm involved in,
the executive leadership team,
all the way down to the front line people.
They are incredible folks,
and there's a very specific process ensuring that happens,
and that's what I'm gonna share with you, today.
Number one, buy back time.
I coach very high-performing founders.
Some of my clients are doing 150 million
in annual recurring revenue in their B2B SaaS businesses.
These are high-performers,
and one of the strategies that I teach them,
all the way down to folks that are still just
you know, 10K a month trying to get things built out,
is the idea of buying back time.
Most people hire under the context
of just adding capacity.
I need to hire a developer,
I need to hire a marketing person,
I need to hire a sales person, et cetera.
We're just adding capacity to our team.
What I encourage my clients to do is,
it's still adding capacity,
but it's the lens that we're looking
through those hires, from,
is the idea of I'm looking at my calendar
and I'm buying back time off my calendar.
So, whatever you're doing,
especially if you're a founder,
you're probably wearing many hats.
You wanna figure out where's the lowest value,
highest time suck work that you should be hiring
to backfill, buy back that time
to get more leverage with your time.
So, it's not to say that it's demeaning work,
it's less work,
but at the end of the day,
it's where we wanna buy back our time
to do higher-value, higher-leverage things,
typically around revenue-generating activities.
That's number one.
Number two, follow workflow.
The idea of workflow, if you think about it,
every business, and I talk about growth engines often,
especially my A.C.E.S. Growth Engine,
Attract, Convert, Expand, Scale.
That engine is all about the workflow,
the process of building a software company.
In software, there's six core functions.
High level things like product engineering,
marketing, customer success, sales, ops and admin,
that we wanna focus on.
We wanna understand that at scale,
when we build our teams,
we're gonna have no more, ideally,
than six to seven direct reports.
Maybe you have 12 right now,
because you have a 12-person team
and you haven't been able to start offloading
some of those direct reports,
but at scale, doesn't matter if you're...
One of my mentors grew his company
to 5000 employees in four years.
A company called Uber.
It doesn't matter if you're 5000 employees,
you're always gonna typically
have six to seven direct reports,
and it works the same as you're scaling,
so that you understand how to follow the workflow.
Where is the bottlenecks in that engine of growth,
or building the product,
or getting the product in front of the customer,
and how to we backfill and hire people
to really own that area of the business.
And they don't always have to be when you're starting off,
like super senior people,
they just have to be anointed and given accountability
so that they know hey,
I'm in charge of this area of the business,
and you can start looking at where are the gaps,
where are you missing people to increase
that throughput through that workflow?
Number three, set the roles.
One of the biggest wastes in company
when it comes to people building the structure
is lack of accountability
or even just awareness of who's accountable for what.
I'm gonna highly encourage that you
think of those six core functions,
kind of map everybody to it,
and really just ask everybody on team,
what are the areas of the business
you feel 100% accountable to?
If you had to give me four to seven things,
processes, output, et cetera,
outcomes that you're accountable for,
what would those be?
And just putting that on a grid.
It's called an Accountability Chart, right?
It's kind of like an org chart,
but it's more about who owns what, right?
By having that, I will tell you,
it will be in value in regards
to quickly making decisions,
allowing new people, this is a big one,
every new person that joins my teams,
they have to be aware of the accountability chart
so that if there's issues,
they know exactly who to go directly to
to get that issue resolved, right?
They have the information of like,
if I have a marketing idea,
I can share it with this person.
If I have a sales tweak,
I can share it with this person.
Too often in businesses,
people are really aware of their immediate teams,
they don't really know what does Mark do
in that department, right?
Having this ability to check this grid,
this structure of who owns what,
who's accountable for...
Most importantly, who is DRI,
Direct Responsible Individual.
Regardless of who's doing what,
there always should be one person that's DRI on a project.
That accountability chart will help you get clear on it.
Number four, revise over time.
The way I think about it,
it's a two by two matrix.
You've got a quadrant.
On the bottom axis, the x-axis,
you have the values that the people...
Do they embody the values of our organisation?
If you don't have values set out, start there.
But if you have values,
or you just know that people work well
with the rest of the team,
that's on the x-axis.
On the y-axis, I want you to put skills.
People that you feel have really strong skills
for that role in the business.
What you end up doing is you have a grid
and you have people that have high skills, high values,
those are your A players,
you need to make sure you're talking to them frequently,
and making sure that they're retained.
Compensation, all that stuff,
they're the people you need to pay attention to.
The other ones that are kind of like,
if the grid's like this,
that are kind of like below there,
or over here, and there,
those people need to be coached into that.
They might have high skill,
they're incredibly talented but from a values point of view,
they're horrible.
Well, I'm assuming you wouldn't
let people like that stick around,
but let's just say they just don't really embody
some of the core values that you set out.
Coach them up.
Those two quadrants need to be coached up
into high skills, high values.
The folks in the bottom corner, okay?
You know who they are.
You can do this as an executive team,
you can say hey, let's draw this grid,
this quadrant, this Dan guy shared the strategy.
Have your team do it and compare notes.
Whoever's in that bottom quadrant,
you've got 60 days to transition them out of your business.
60 days is the most amount of time.
If I gave you 90, you don't need 90.
You don't need to be reactive,
but you've got 60 days to say we need to hire somebody,
we need to backfill, we need to document their process,
they gotta be moved out of the company.
Why?
They don't have the skill,
they don't embody the values,
and at the end of the day,
there is probably an incredible company
where they can rock at,
they can be a rock star,
and it's just not going to be yours,
based on the way you've structured things,
and that's totally fine.
But they just can't stay on the team, okay?
It's hard to say big circle, they gotta go.
If you do that, at least every six months,
that's my process.
Every six months, you evaluate and you make adjustments.
You'll never run into an issue
where somebody totally lets you down,
there's a critical failure
because there was an under-performer,
you have somebody that's rude,
especially on the values side,
that's rude to other A players on your team
and they quit because of that person.
I don't care how skilled somebody is,
if they do not follow the values over time,
it risks me losing my A players,
and that, to me, is too critical.
If you do that every six months,
you'll never run into those issues.
Number five, make hard decisions.
Look, I'm bringing this up again,
because I know you know who those people are
that have to bounce on your team.
I know you know who they are.
They're the folks that you're micro-managing.
The people that you argue with
when you're getting an update,
because they're always talking about busywork
but nothing's actually getting done.
They're the ones that keep coming up
for causing conflicts or not responding to things
or not managing their time properly.
Whatever it is, you know who those people are,
and I'm going to challenge you 100% straight up,
hopefully I can convince you,
that removing those people from the team,
creating the whole amongst your team,
to have to fill it,
because if you don't remove them,
then there's no vacuum,
there's no need to fill it,
there's no need to prioritise getting that job posting,
sourcing new candidates,
going through the recruiting process, et cetera.
There's no need to prioritise that,
and you're being incredibly selfish to that person
because they're not gonna be allowed to shine
and spread their wings in a company
where they can be world class,
because you are too self-centered and selfish,
and that's really what it comes down to,
to let them move on,
because you don't want it to hurt
or frustrate you and your business.
So, it's not even about your business
in many of the cases,
it's just easier to keep them around,
and that's selfish for them,
and it's the wrong thing for your team.
You know who those people are.
I want you to have that tough conversation,
make a hard decision,
and build the plan, 60 days at the max,
but honestly, if you know they'll go
and there's no impact to your business,
let them go on a Friday, okay?
I have a whole video,
you can go find on my YouTube channel,
on how to let people go,
do it on a Friday.
Don't do it on a Monday.
That'll give them time to calm down.
You can really do right by them,
but make the hard decision.
So quick recap, how to build a strong team
for your SaaS company.
Number one, buy back time.
Number two, follow the workflow.
Number three, set the roles.
Four, revise over time,
and five, make that hard decision.
As I mentioned at the beginning of this episode,
I want to share with you an exclusive resource
called the High Octane Team Technique.
In it, I have a very structured planner
that you can use to kind of map
where you're at as a CEO and founder,
and the six core functions of the business.
Specifically, the four outcomes that are required
by your executive leadership team.
Those four are quick-recapped,
they're all covered in the download.
You click the link below to get a copy.
It is strategy, delivery, systems, and reporting.
I dive into those and those core functions,
and then within that, I even give you a worksheet
you can use to upgrade your team.
Identify the weaknesses,
talk through the strategies,
and also, be clear on the metrics
that you're holding them accountable to.
That is typically what's missing
for you as a leader to feel more comfortable
with the performance of a team member,
and it gets everybody on the same page.
You click the link below to get your copy.
If you like this video,
be sure to smash that like button,
subscribe to my channel.
If there's anybody you think this video
could serve directly,
feel free to share it with them.
As per usual, I'm gonna challenge you
to live a bigger life and a bigger business,
and I'll see you next Monday.
(Dan singing)