BTQ

Account Manager

Startup Life: A hiccup or cause for concern?

Since 2023 started, we've lost 3 of our biggest logos.

In 2022, we signed the biggest deal in company history $250k. A few months back, we found out our product had been removed from their site. We weren't told why, just to stop using their customer examples and name for outbound. A month before this, we lost a POV trial too. Shortly after our CS manny got fired.

Leadership hasn't updated us at all on the situation but I looked in our CRM to see for myself. I saw emails back and forth from their side informing us they're terminating our contract and not paying the full amount owed.

Should I be concerned?

📠 Startup

30 comments

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braintank

Politicker

Enterprise Account Executive

Probably

braintank

Politicker

Enterprise Account Executive

Means your product isn't sticky nor worth the investment

BTQ

Politicker

Account Manager

What do you mean by "sticky"?

braintank

Politicker

Enterprise Account Executive

Unnecessary

Revenue_Rambo

Politicker

Director, Revenue Enablement

Sticky solutions get woven into a company and become critical to their day-to-day operations. Like how SalesForce gets tied to marketing, campaigns, prospecting, case management, quoting, billing, etc. Similarly Slack integrates into a variety of business applications become a core part of using those other systems. The wider the spread the more difficult it is for a business to justify making that change.
A solution like Miro that does collaborative digital whiteboards may be used as a stand alone solution. If it breaks, has bugs, or isn't user friendly could be easily dropped and replaced by a dozen other similar options.

braintank

Politicker

Enterprise Account Executive

Well said

CuriousFox

WR Officer

🦊

Don't keep your head in the sand dude.

Fenderbaum

Politicker

Retired Choirboy🪕

CuriousFox

WR Officer

🦊

Throw your ass in the air...and wave it around like you just don't care...
Wait a min 🤔😎

Fenderbaum

Politicker

Retired Choirboy🪕

Keep going please!

BTQ

Politicker

Account Manager

I secured a parachute last week, unfortunately it's not in sales.

BmajoR

Arsonist

Account Executive

A temporary parachute while you find your way back into sales is not a bad choice. Making sure your bills are paid and food in your belly is priority #1, so good on you for doing that.

Fenderbaum

Politicker

Retired Choirboy🪕

Priority #2 is no parking tickets.

Revenue_Rambo

Politicker

Director, Revenue Enablement

Customers (even big ones) come and go, its inevitable. My concern would be on the % of revenue attributed to those logos. Depending on how big of a hit they represent could drastically change the business strategy.

BTQ

Politicker

Account Manager

Gotcha. A common theme with all three is they got bought out and are under new management so they're cutting costs wherever they see them.

Kosta_Konfucius

Politicker

Sales Rep

Yeah this would be a big concern, especially since they werent planning on losing those

Space_Ghost20

Valued Contributor

Account Executive

Startup I worked for in 2022 had something similar happen. Lost their second largest customer, and most of the top 10 had scaled back their usage (we charged on use, month to month as opposed to yearly or quarterly commitments) due to the economy. Revenue dipped something like 35% in a single month. At the same time they were burning money on a "30 day" beta for their new product, that was by then in its 4th month. We (the AEs) lined up a slew of fairly large deals with signed contracts that couldn't be fulfilled because product launch kept being pushed back. Multiple rounds of layoffs ensued (one of which I was an unlucky participant in) and the company limps on, but as a shadow of what it was when I was there.

Startups have to continuously diversify their top 5 or top 10 customers to minimize risk of churn. The risk goes up the smaller the runway is. For my company, they were pre-seed, debt financed. Runway was smaller than what you'd probably see in a company that was post Series A.

So, it depends on where your company is. But I would definitely have some concerns.

BTQ

Politicker

Account Manager

Thanks for offering your thoughts and experience with this type of thing.

lowhangersalesbanger

Executive

Director of Sales

Maybe. But not because of the logo loss. That happens in a startup and can simply be a growing pain of the business. What SHOULD be happening at any startup is communication between leadership and the workforce.
Over transparency should be the go-to for the leadership team. If they are being hush-hush about all the negatives then there is likely something they are hiding because their egos won't allow them to look anything less than god-like to their workers.
Dust off the old resume boyo

BTQ

Politicker

Account Manager

Thanks ser. I secured a parachute but its not in sales :(

Sunbunny31

Politicker

Sr Sales Executive 🐰

Exactly this. They should be letting you know what happened so it can be avoided. If they aren't, telling you anything, then it sounds like whatever the issue is cannot be avoided. Your solution churns, which puts the rest of your existing customers and your pipeline at risk.

sketchysales

Politicker

Sales Manager

I would try find out the route cause. Any other deals in the pipeline that should steady the ship or is the outlook dark and stormy?

BTQ

Politicker

Account Manager

We have $650k+ in pipeline right now but I'm concerned with a recession Q4/Q1 causing more cuts.

FinanceEngineer

Politicker

Sr Director, sales and partnerships

I would be looking for a new role asap. Sounds like a downward spiral.

pwnzor

Opinionated

Head of Sales

Yup, I'd be concerned especially if it's a newer company and you're seeing the trend across customers and categories(verticals, company size, etc)

saaskicker

Celebrated Contributor

Enterprise AE

3 strikes and you're out. I'd be concerned.

Diablo

Politicker

Sr. AE

time to change the gear.
What % of the entire business this client is worth?

GDO

Politicker

BDM

attrition is an extremely bad sign. It either says something about the product/services or overselling the solution/bad fit(persona)

Justatitle

Big Shot

Account Executive

Seems as though the company doesn’t meet up to promises. That’s a concern

pirate

Big Shot

🦜☠️ Account Executive

Yes. They don't have the smarts to keep biggest logos?

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BTQ

Startup Life: A hiccup or cause for concern?

30 comments

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