Hey - Marc here.

Happy Saturday morning, motivated B2B SaaS Founders!

Here's at least one tip to keep in mind as you grow your B2B SaaS company:

Today's issue takes about 5 minutes to read.

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In today's issue, I share some key takeaways from a recent interview between Nathan Latka, the host of Daily Interviews with SaaS Founders, and Derek Osgood, the CEO and Founder of Ignition. They discussed how he spends $150k per month on 21 full-time employees to build a tool that helps product teams launch.

Derek has been a product marketing leader at several companies, from startups to major brands like Playstation. In this role, he has launched over 100 products and generated over $1B in revenue. Now, he is building the platform he wished he had all along the way.

About Ignition

Derek Osgood, a former marketing executive turned founder of Ignition, has helped 800 companies across various industries to date, including SaaS businesses and CBG-type organizations, build an innovative platform that streamlines the go-to-market process for product teams.

Their first line of code was written in March 2021 and launched in beta in January 2022, with hundreds of users onboard already! Their 21-person team is fully distributed across the world. Fully capital efficient, Ignition has a $150K total headcount expense, excluding founder salaries — making them one tough competitor on the market today.

Challenges

There's always this dumpster fire of tools hodgepodge together.

Derek had a front-row seat to see how these companies fell short. The real problem with most tools is that they don't do any work. Teams end up having to go through all the actual research and competitive intel in a completely different place which slows down their team's process for executing decisions.

Intermixing two different lines of work that have completely different communication needs.

Launches are about so much more than just project management. That's why they developed an end-to-end system for managing every aspect, from customer research through strategy and post-launch communication, with the measurement at the heart of it all.

A lifetime deal destroys all the unit economics with SaaS.

But it was one of the most valuable things they've done. They knew that one of the ways to get a good product was by getting feedback from their beta launch and improving it before scaling up with user acquisition. Now, they've got tons of engaged users and much more valuable testing for their products.

Advice to Other Founders

Look for talents around the world.

They've built a team that is both efficient and diverse. They did this not only to save money but also because they believe there is talent everywhere — and ended up with a fantastic team who can work together seamlessly as one unit!

Be engaged very closely with a large community in your space.

Derek profoundly believes in the benefit of community engagement. It offers them an advantage, whether it's their own or someone else's — and they can get ahead by leveraging this connection to confer them as experts in the space and for partnerships and promotional opportunities.

Be relatively light-handed in trying to convert the free users in their beta to paid users.

The best way to get early adopters on board is by ensuring their product experience has minimal stress. You don't want them feeling like you're pushing too hard or forcing conversions. Instead, make them feel excited about your product.

More customer interaction is better.

Derek believes that the needs of small business users are just as significant, if not more so than those in larger companies — and they should be treated with equal respect by developers. When launching products, regardless of size or industry, all companies face these challenges — including the slightly smaller ones.

Bonus

Derek's favorite book of all time is a fantasy book called "The Kingkiller Chronicle: The Name of the Wind." But his favorite business book is "Good Degree."
His latest public revenue number was somewhere in the range of $20-30 million.
His favorite online tool for building Ignition is Linear.
He wished he had learned to be more aggressive in his 20s. He enjoyed his time at PlayStation and learned a lot there, but he wishes he had started his own business earlier.

TL:DR

Ignition helps your go-to-market teams plan, go to market, and launch new products. They've got around 500-800 customers actively using the platform and converted some portion of those to paid users. Now they have their eyes on breaking a million-dollar run rate by the end of the year or early January 2023 with 21 full-time employees on their team, spending on headcount outside founder salaries is about $150K per month. Raised an initial $3.1M seed and another $1.8M pre-seed – now has plenty of cash to work with that growth.

P.S. Here is a link to the full interview if you are interested in listening to the full episode: Founder spends $150k/mo on 21 FTEs to build a tool that helps your product teams launch.

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See you again next week.

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