How to “Entrepreneur in Residence” in SaaS
After about 8 years in SaaS companies, I landed a super interesting role as an Entrepreneur in Residence at a Series A FinTech business.
Now that's definitely a job title that could mean a lot of different things depending on the role and the company.
My task was essentially to figure out how we could make money from a new area of the business, and to execute it as fast as possible. I did this together with a couple of engineers, a product manager, a product designer, and later, a dedicated Customer Success Manager.
We were basically an almost autonomous startup within a scale up, which was great!
Because an Entrepreneur in Residence role could mean so many different things, there isn’t really a “one size fits all” manual out there. But if you find yourself in a similar commercial role of building something new in a company that already has a primary product, whatever your role might be called, here are some of my thoughts and learnings, and a run through of some of the areas that I focused on. Not quite a manual, but maybe some useful pointers!
6 things I focused on in a startup EIR role
Business case
One of the first things I did was to write a business case. It built on research that the founders had already worked on over the last years. This was a great way to get my head around the market, the need for the product we were building and at least the short term goals, if not even some of the longer ones too.
A business case will help you get further buy-in on why the company should invest in your area of the business, so it is really important.
I then summarised it in a few slides and presented it to the management team. Keep it clear and simple. What’s the one thing that should be communicated to the board about why this bet is worth the time and money?
Profit and loss
A P&L, basically being able to show how much revenue our product would generate weighed against the cost of the team's salaries and direct costs that related only to our product, was key in order to set and agree on expectations. And if you have one in place, it will be really powerful to hopefully later demonstrate where you break even.
You may need to negotiate these numbers internally, but in the end, everyone will benefit from being on the same page in terms of expectations.
Pricing
If your job is to figure out how to generate revenue like, a key component to play around with is the commercial model and pricing strategy. I was given free hands here to test and tweak over time, which was great.
As with any new product, I found that keeping an open mind and trying to get as much revenue as possible where I could, and less where it was needed against a good logo, was the way to go.
At one point or another you may need to weigh the benefit of adding new customer logos vs creating revenue, which one is more important to deliver and what matters more for your company's overarching goals?
Testing a type of freemium offer can be a good way to gain logos and also give the product manager working with you valuable feedback from customers.
Goals and planning
Once you have some kind of profit and loss under your belt and a business case to grasp the bigger picture, it’s of course time to think about the nitty gritty of how to get there. I personally found it useful to do quarterly plans with five overarching goals, and some key activities to be completed under each. An ODE framework may be helpful for this.
It will be difficult for people to evaluate how you are doing in your role if the only measure of success is revenue. So make your life a bit easier by making it clear what you aim to deliver in terms of activities, and then at least you can go back to show what exactly is not working if needed.
As an example, my overarching goals could be something like this:
Increase pipeline from outreach
Increase awareness within our existing customer base
Establish new partner channels
Improve our content and messaging
Improve our team processes
By making your activities under each goal very specific, your role also becomes a lot more measurable on other things than just revenue.
Goals like these also make it very clear that your team doesn't act in silo, you need the support from the rest of the company to succeed. As an example, if on that second goal you set a metric of sitting in on 15 QBR’s (quarterly business reviews) to talk through a slide about the new product with existing customers, you will need to work with the Customer Success team to make that happen.
Internal collaboration
And that leads me to a part, which took me a while to get right - how to collaborate with other departments.
Typically when you enter a new company you are part of a clearly defined department (sales, marketing, CS etc) and there may be fairly set processes for how that role interacts with other departments. But when you are building something new, you need to also build those collaborative processes from scratch.
I’ve realised there are a few things to figure out first.
How is working with you valuable to other departments?
How much of their time and resources can you ask for, what is your mandate? Make this clear with the management team to avoid any later conflicts.
How much of their time do you need? Be prepared to prioritise your top 3 asks to each department so you can evaluate these in regular check ins.
Let’s bring this alive with an example.
Collaborating with Sales
You may want to work with the sales team so that they book demo meetings for your new product, include some information in their pitch or feed back prospect input to you. Sounds easy enough? But sales teams have set targets that probably relate to the core product, so it will be a challenge to get any of their time if the gain is not very clear.
Firstly, if it’s not yet built into the remuneration, could you consider short term sprints or projects where they push your area against some ad-hoc rewards and kickbacks? You’ll need to agree this with the SD or CRO.
Secondly, can what you are building help them with their targets, e.g. does the offering make the rest of the product more sticky? Help describe this value to them.
Make it easy, rank the top 3 priorities they can help you with. Make sure to communicate to your manager and internally that these are the priorities and ensure it will be part of the department's quarterly planning. Once your goals are part of their goals, you can really start collaborating.
Team collaboration
I worked with employee engagement software for 5 years in the past, so I certainly know the value of motivation for driving business outcomes! Especially if you are working in a cross functional squad or team like I was, it’s key that everyone is in sync and pulling in the same direction, even if your day to day tasks look very different. My squad was also fully remote so communication became even more important.
A couple things that worked for us:
We would take notes from all meetings, small or big, internal or external, and record these in Notion so that everyone could keep up to date (there are of course automated note takers available out there too)
Daily stand ups (mainly product driven for the engineers and product team)
Weekly planning meets
Dedicated Slack channels (squad specific and collaborative with other teams)
Quarterly timelines of what happens and when
Regular (virtual) team events to play some games and have a drink together
Meeting in person, if possible
Building something new is tough, so staying aligned is key.
Final word of warning!
And finally, you should be aware that in many cases, as an Entrepreneur in Residence you are taking on a potentially quite risky role. By default, if the organisation is testing something new, things can go either way. You could end up in a situation where what you are working on really takes off, or equally, one where it gets closed down for reasons that may or may not be within your control. In my case, the early success of the track helped drive a higher company valuation but as the company got acquired it meant that from one day to the next my role was no longer needed, so I got to shift over to a different team.
Like in any start up role, be prepared for anything at any time!
And have fun building - it doesn't get much better than building a startup within a scaleup!
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My name is Stina and I help SaaS startups drive more revenue. If you’re thinking about adding an Entrepreneur in Residence role at your company and want to brainstorm with me, or if you’re working as one and want to exchange some ideas, feel free to reach out!