Remove deliberately-underselling
article thumbnail

The Complete Guide to SaaS Pricing Strategy

Tomasz Tunguz

The Deliberate Underselling Strategy One powerful strategy for usage-based pricing is deliberate underselling. Similarly, Salesforce began with a usage-based approach before shifting to annual seat contracts when churn rates became significant and revenue predictability faltered.

SaaS 111
article thumbnail

How to Structure Your Sales Compensation Plan to Deliberately Undersell

Tomasz Tunguz

In Deliberately Underselling as Sales Strategy , I wrote about the importance of sizing contracts below customer needs to ensure customer success. When deliberately underselling, the company should value the expansion dollar equally to a new customer dollar. ” I received a pile of questions asking for more detail.

strategy 143
Insiders

Sign Up for our Newsletter

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

article thumbnail

Deliberately Underselling as Sales Strategy

Tomasz Tunguz

Take 2: The account executive deliberately undersizes the contract by a quarter or a third. Deliberately undersizing contracts trades short-term bookings numbers for better unit economics, healthier customer relationships, and more expansion. In both cases, the vendor is out. This is overselling by accident. AEs are more effective too.

strategy 142
article thumbnail

How to Structure a Startup Sales Team for Optimal Land & Expand

Tomasz Tunguz

Bill & I exchanged emails about Deliberately Underselling as Sales Strategy. First, Deliberately Underselling means optimizing the sales process for Net Dollar Retention (NDR). I asked him to share his views on land & expand team structure & quotas. But we covered much more.

article thumbnail

Office Hours with Bill Binch: Structuring Sales Teams for Success

Tomasz Tunguz

Over the last few weeks, I’ve been writing about Deliberately Underselling as Sales Strategy. He led Marketo sales as EVP of Worldwide Sales. Most recently, Bill led the sales team at Pendo as CRO. Today, he’s an operating partner at Battery.

strategy 106
article thumbnail

Top 10 Posts of 2022

Tomasz Tunguz

Deliberately Underselling as Sales Strategy Borne from a series of Office Hours with Lee Kirkpatrick & Bill Binch, this post advocates for quicker sales cycles with smaller ACVs to drive more predictability & superior NDR. Figma’s 50x ARR Multiple & What it Means for Startup Fundraising.