- How We Grew From $1M to $5M
How We Grew From $1M to $5M
What got you here won't get you there—or will it?
Hey folks 👋, I'm Kenneth Burke. #BurkeBits is where I share stories, data, and frameworks to help you become a better marketer. Subscribe for free to level-up.
Cold calling our ideal personas
Outbound email to the same
Inbound marketing through blogging and SEO
You can see how we made each of those work here.
They say “what got you here won’t get you there,” but, through trial and error we learned that’s not exactly true.
In order to get from $1m to $5m in annual recurring revenue (ARR), we had to keep doing what got us to $1m and also add on a lot of other things. I’ll share with you 5 things that worked and 3 that didn’t.
Keep in mind that I’m telling this story through a marketing and business development lens. Throughout all of this, we were also making significant improvements to our features and customer experience.
5 Ways We Grew From $1M to $5M
1. PR—yes, it actually affected revenue.
After we hit $1M, we thought it was time to tell our story. Only 4% of startups hit $1M, and we were both bootstrapped (not funded) and building outside of Silicon Valley (in Chattanooga, TN), so we felt special.
I’ll skip a lot of details here and say that what worked for driving revenue was:
Building a paper trail of press wins and interviews that helped us solidify deals when prospects went to do their due diligence, and
Getting coverage in niche industry outlets that our target customers paid attention to
The relative golden goose was being interviewed in an article for ACHR News (heating and air) that directly led to 83+ new paying accounts. We did this again and again, and it helped.
2. Google search ads.
Attribution tracking has been the bane of my marketing existence, but we eventually had clear evidence that when we increased spending on search ads, demos and sales would rise significantly 2-6 weeks later. When we decreased spending, we saw the same happen in reverse.
We had good organic rankings, but this is how we outranked competitors enough to win enough deals to keep fueling the fire of growth.
3. Earning online reviews on key platforms.
We had a terrible problem for awhile where we were creating a ton of qualified sales opportunities and closing very few of them. The #1 "closed-lost reason was “chose competitor.”
I can’t remember how we figured out this was the case, but we realized that, even though we were winning in search results to create these sales opportunities, we were losing deals to competitors who had significantly more positive reviews than us on platforms like G2 and Capterra.
It took some tinkering, but we eventually started sending review requests to every user, and it began paying off.
We didn’t create significantly more opportunities this way, but we began winning deals at a much higher rate.
4. We recreated the website.
Completely rebuilt it, with new designs, new navigation, new content—the works. It was a beast to make happen, but it did a few things much better than the old site:
Spoke to target customers in their language
Shared an overview of what the product could do
Transparently listed our pricing
Made it easy for viewers to get answers to their questions
Created a smooth process to purchase or talk to us (take the next step)
It wasn’t the best site ever (we’ve since redone it again), but it did its job well enough to bring in qualified leads and sales.
Depending on the year, 10% to 20% of our opportunities came from referrals, and those closed at a far higher rate than prospects from any other channel.
This was only possible because:
Marketing and Sales talked to customers like equals, and helped them make important decisions for their businesses
Our product was easy and enjoyable to use
Our customer service and support teams treated them so well, with personal onboarding and support at every step
It truly takes a full company to create great experiences, and it’s well worth the effort.
Honorable Mention: Partnerships.
Partnerships were a mixed bag during this stage—I’ll do a separate post about that—but they did bring in some notable revenue.
Note: So much other hard work, frustrating challenges, and lucky breaks played into our success, but we don’t have time to cover all of that.
3 Things That Didn’t Work
1. Outsourcing BDRs for cold calling.
We hired a group to book demos for us. They were as professional, analytical, and hard working as you could want. Except, only 50% of those demos would show, and only 50% of those that showed had any interested in learning more about Text Request.
The demo-to-close conversion rate for this channel dropped to 5% to 10%, compared to our 20% to 25% average. Ouch.
We’ve since brought the same approach with the same target customers in-house, and it’s worked well. The instant feedback loop makes such a difference.
2. Retargeting and display ads.
We tried 2 things: retargeting website visitors through Google’s display ad network, and showing display ads to lookalike audiences through AdRoll.
And by that, I mean that we could not:
Source new, qualified prospects
Significantly influence existing opportunities (e.g. speed up the sales cycle)
Properly attribute its effects
Our creative was okay, not great. Our click-through rates and time on site were both decent. We had a few conversions to leads and paying accounts, but overall it was neither a profitable nor effective way to increase revenue.
3. RFP bids.
Large companies, government entities, and various other organizations source new vendors through a Request For Proposal (RFP) process, to which you can submit a bid.
Some of these are invite-only, and some go through marketplaces to source bids. We put a ton of effort into personally creating and submitting bids, then hired an agency to do it for us, and still we didn’t win a single one.
What a bummer.
Since this period, we’ve won 2. Both were for organizations we’d already been in communication with before the RFP process started.
I don’t regret us investing in any of these approaches that didn’t work. We took all the right steps with them:
Chose tactics that had a good argument for being effective
Thoroughly researched how to do them well and who to partner with
Combed through every detail of the process to do it right
Gave each significant time to show results
Committed to measuring each and staying accountable to our metrics
That’s the kind of work you have to do to grow a company. Not everything will work. That’s okay. Just make sure your wins are bigger than your losses.
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Have questions about this topic or something you’re working on? Ask away! I’m an open book and happy to help.