Jan 8, 2025 · 39m · saastr
Usage-Based Revenue Models: Successes & Pitfalls from Checkr COO Lindsey Scrase on CRO Confidential
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In this episode of CRO Confidential, Checkr COO Lindsey Scrase joins host Sam Blonde to discuss scaling usage-based SaaS organizations. They detail actionable frameworks for aligning sales incentives with revenue realization, leveraging RevOps data segmentation, and optimizing customer onboarding.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. How this is scored →
Jason as informed peer 5.9 Guest teaching 5.2 Guest disagreement 0.1 Jason pushing back 0.1
speaking balance: gold is Jason, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 23:15 Critique of traditional SaaS commit mechanics
Scrase challenges standard SaaS contract conventions, arguing that upfront commit quotas actively damaged deal value by encouraging reps to offer excessive discounts.
Hardest push from Jason ▶ 22:58 Clarifying over-forecasting dynamicsSam interrupts Scrase mid-thought to sharply distinguish between bookings forecasting and revenue reality, reframing the dynamic as over-promising and under-delivering.
Biggest teaching moment ▶ 11:25 Comparing bookings attainment to revenue realizationScrase breaks down the mathematical fallacy of relying on bookings quotas, contrasting a rep closing 1.5M with 700k revenue against a rep closing 900k bookings generating full revenue.
Jason holds their own ▶ 20:15 Zenefits geographic data analysis exampleSam establishes his operational authority by detailing how slicing conversion data by state led Zenefits to immediately cease selling in 15 to 20 low-margin states.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Jason as informed peer | Guest teaching | Guest disagreement | Jason pushing back | Why |
|---|---|---|---|---|---|---|
| Checkr's Origins and Go-to-Market Architecture | 4 | 5 | 0 | 0 | Sam Blond sets the stage by asking Scrase to describe Checkr's go-to-market structure upon her arrival. Scrase details Checkr's evolution from gig economy beginnings with DoorDash to mid-market and enterprise expansion. The exchange is purely introductory and collaborative. | |
| Segmenting Sales Cycles and Usage-Based Monetization | 5 | 6 | 0 | 0 | Sam prompts Scrase to clarify sales cycle lengths and how Checkr monetizes compared to traditional SaaS. Scrase explains their usage-based pricing model and cycle durations ranging from minutes in self-serve to a year in enterprise. The tone is informative with both sharing standard SaaS frameworks. | |
| Diagnosing Gaps and Shifting to Revenue Realization | 4 | 7 | 0 | 0 | Scrase lays out her methodical discovery process upon taking over as CRO, identifying misalignment between bookings targets and actual revenue realization. She explains how shifting from pure bookings quota to tracking revenue conversion transformed team accountability. | |
| RevOps Metrics: Tracking Conversion and Revenue Per Report | 6 | 7 | 0 | 0 | Scrase details specific metrics developed at Checkr, including month-two bookings-to-revenue conversion targets and coining average revenue per report run. Sam connects this directly to core RevOps principles and the Charlie Munger philosophy on incentives. | |
| Optimizing GTM Efficiency Through Geographic Data Cuts | 8 | 2 | 0 | 0 | Sam leads this segment with a detailed case study from his time at Zenefits, explaining how geographic RevOps analysis led to cutting sales in 15 to 20 unprofitable states. Scrase listens as Sam demonstrates deep operational domain expertise. | |
| Restructuring Commit Incentives to Prevent False Bookings | 6 | 6 | 1 | 1 | Sam interrupts briefly to clarify the difference between bookings and actual revenue forecasting in usage models. Scrase explains how upfront contract commit incentives inadvertently motivated sales reps to offer steep, unnecessary discounts. | |
| Extending Revenue Compensation to SDRs and Marketing | 8 | 4 | 0 | 0 | Sam shares a comprehensive breakdown of Brex's transition to compensating SDRs on closed revenue rather than merely scheduled demos. Scrase validates this approach, noting Checkr is testing similar closed-won compensation for outbound BDRs. | |
| Optimizing Technical Pre-Sales and Engineering Feedback Loops | 4 | 7 | 0 | 0 | Scrase explains how requiring solutions engineering sign-offs prevented overbooking and enabled cleaner onboarding. She also outlines their Adopt a Customer program to connect product and engineering teams directly to enterprise customer feedback. | |
| The Strategic Value of Onboarding and Executive Engagement | 8 | 3 | 0 | 0 | Sam shares a tactical lesson from Brex about dedicating specialized CSM teams strictly to the first 30 days of customer onboarding to maximize card spend and retention. He synthesizes the episode into clear operational rules around RevOps data, incentive alignment, and executive customer time. |
Statements from this episode (17)
Sam Blonde: Checkr was most recently valued at around $5 billion
“So just incredible experience at one of the sort of generational SaaS businesses of the last decade in Checker, most recently being valued around five billion dollars.”
Scrase: DoorDash was Checkr's very first customer
“Checker, we got our birth in the gig economy, so DoorDash was our very first customer, 10 years ago, and obviously has grown quite a bit since then, and grown with Checker.”
Scrase: Checkr captured over 95% of the gig economy market
“We started with DoorDash from there to ride sharing and other delivery companies and had 95% plus of the gig economy.”
Scrase: Checkr's earlier pivot to enterprise did not succeed
“In terms of the organization when I joined, we had then pivoted, I can talk about it later, to enterprise quite some time ago. Did not succeed.”
Scrase: Checkr embeds directly into Gusto, Rippling, Greenhouse, and Paylocity
“We also, though, at that, for that segment, we have a very large channel business as well. Think like Gusto. They're Payroll providers, Gusto, Paylocity, where we're embedded in that experience. Same for applicant tracking systems like Greenhouse or HRIS like …”
Scrase: Checkr mid-market sales average 30 days, enterprise up to a year
“The, in the mid-market, kind of commercial mid-market segment, thinking like, 30 days is the average cycle time, and deal sizes in the tens of thousands of dollars, typically, and then up into enterprise. With enterprise, it could be as long as a year sales cy…”
Scrase: Usage-based SaaS demands different management than typical seat-based subscriptions
“This is a transactional business and usage based, and that needs to be managed very differently than a typical subscription SaaS model. And we earn revenue when the customer is using the product. It's versus the license space where you're, as a seller, on the …”
Scrase: Checkr shifted SMB sales incentives from raw volume to realized revenue
“Their lowest or smallest, lowest segment sales team was focused on activating customers. No, no incentive on revenue whatsoever. It's just like a volume based incentive plan. And so completely changed that focus of that team, moved them to the revenue focus, b…”
Scrase: Checkr sales reps were overbooking deals to hit quota
“We saw a lot of reps were overbooking deals because there was this pressure to just hit this bookings quota. So we were way overbooking deals in many instances.”
Scrase: Checkr lifted month-two booking-to-revenue conversion from 4% to 12%
“We measure month two booking to revenue conversion. What was the expected revenue? And we had set the goal of 10%. So 10%, we should be seeing 10% of the bookings realized within, by month two. And it was at, like, four. And we pushed, and now it's at 12.”
Scrase: Checkr discounted unnecessarily despite strong win rates
“And I think we saw that we were discounting often unnecessarily given where our win rates were, which were quite strong.”
Scrase: Checkr maintains a gross revenue retention rate in the high nineties
“Our GRR is high nineties. The max you can get GRR is a hundred percent.”
Scrase: Checkr removed upfront commits, tying sales compensation to revenue realization
“So we took that specific component out, and we're sniffing on different things that we do want to see more of, and we're tying the actual bulk of the compensation more to revenue realization, which is better for the customer, it's aligned with Checkr.”
Blonde: Brex AE-sourced outbound generated exponentially higher ACVs than SDR-sourced pipeline
“The AE sourced opportunities converted at a significantly higher rate to customers, and they generated far more revenue. So the ACV of AE sourced outbound opportunities was significantly, almost exponentially higher than the SDR sourced opportunities.”
Scrase: Checkr shifted BDR compensation to include closed-won revenue
“We just shifted to the same thing for our SD. We call them BDRs for outbound SDRs to give a component of the comp based on closed, closed one as well.”
Scrase: Checkr mandates pre-sales solutions engineer sign-off to close enterprise deals
“And so we've really oriented that a deal, especially as we're investing heavily in enterprise, we have a big goal on new logos closed and on revenue, but also implement successful implementations and making sure that the pre-sales team and our solutions engine…”
Blonde: Brex predicted long-term renewals and revenue from 30-day card spend
“We could actually predict things like expansion renewals for Brex. It was card spend. So how much revenue a customer would generate? By their, the actions that they took very early on as a customer. And for us, it was like the first 30 days.”