Sep 16, 2022 · 1h 12m · saastr
Live from SaaStr Annual 2022: AMA with SaaStr's CEO
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gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions
In an open AMA session at SaaStr Annual 2022, SaaStr founder Jason Lemkin shares practical insights on venture capital fund mechanics, go-to-market execution, executive hiring playbooks, and crisis leadership for growing software companies.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Jason holds 89.9% of the talking time here. How this is scored →
Jason as informed peer 8.3 Guest teaching 0.0 Guest disagreement 0.3 Jason pushing back 1.8
speaking balance: gold is Jason, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 33:20 Challenging focus on late-stage metrics
The attendee pushes back against Lemkin's high-level content, noting that frameworks for $100M ARR are unhelpful when early-stage founders are merely trying to survive.
Hardest push from Jason ▶ 16:24 Calling out fundraising excusesLemkin sharply rejects the premise that founders can excuse missed revenue targets due to time spent fundraising, labeling it an instant red flag for VCs.
Biggest teaching moment ▶ 1:05:05 Attendee reveals scaling with only two repsThe attendee reveals their startup reached $5M in revenue with only two sales reps, momentarily astonishing Lemkin with their lean efficiency.
Jason holds their own ▶ 12:35 VC fund return mathematicsLemkin illustrates the harsh mathematics of venture capital funds, demonstrating why standard exits fail to return a fund without extreme outlier performance.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Jason as informed peer | Guest teaching | Guest disagreement | Jason pushing back | Why |
|---|---|---|---|---|---|---|
| Welcome and Acknowledgments at SaaStr Annual 2022 | 8 | 0 | 0 | 0 | Lemkin opens the AMA by dissecting lessons from SaaS leaders like Ben Chestnut and Dharmesh Shah. He details specific metrics such as Net Revenue Retention (NRR) and multi-product expansion strategies with deep contextual knowledge. | |
| Frameworks for Startup Goal Setting and Quotas | 8 | 0 | 0 | 1 | Lemkin lays out his proprietary C-10, C-60, and C-90 confidence frameworks for financial modeling, burn rate management, and sales quota setting, referencing Sam Blonde's playbook at Brex. | |
| Characteristics of Elite Founders and VC Economics | 9 | 0 | 0 | 1 | Lemkin runs through the harsh power-law economics of venture capital fund math, calculating required returns on $500M funds and contrasting top-tier founder qualities across Veeva, Yammer, and Bill.com. | |
| Balancing Product Quality, Speed, and Investor Expectations | 9 | 0 | 1 | 7 | Lemkin forcefully rejects the founder excuse of missing monthly growth targets due to fundraising. He explains that venture investors only back extreme outliers who execute both operational goals and investor pitching simultaneously. | |
| Navigating Crises and Black Swan Events in Leadership | 8 | 0 | 0 | 0 | Lemkin recounts historical crisis management playbooks across black swan events, detailing the cancellation of SaaStr 2020, key executive departures, and navigating bank runs in the 2008 financial crisis. | |
| Evaluating Y Combinator Value Versus Seed Funding | 8 | 0 | 0 | 2 | Lemkin evaluates Y Combinator's dilution cost versus signaling value, giving concrete examples of portfolio companies like Front, Algolia, and Treasury Prime where elite technical founders needed network validation. | |
| Early-Stage Sales Hiring and Demand Generation Tactics | 8 | 0 | 1 | 1 | Lemkin responds to an audience question about early-stage sales tactics, giving granular advice on hiring the first two reps based on customer empathy, ACV alignment, and hiring demand gen marketers early. | |
| The Strategic Competitive Advantage of Phone Support | 9 | 0 | 0 | 1 | Lemkin delivers an impassioned case for live human phone support as a tactical moat in SaaS, comparing the cost of support personnel directly against software engineering overhead and retention impact. | |
| Fundraising Dynamics and Scaling for Bootstrapped Startups | 8 | 0 | 1 | 5 | Lemkin corrects the attendee's assumption that VCs disfavor bootstrapped startups, noting investors covet clean cap tables while explaining the historical trade-off of time-to-scale. | |
| Long-Term Vision and Growth Milestones for SaaStr | 7 | 0 | 0 | 0 | Lemkin outlines SaaStr's operational economics, explaining how the platform generates $27M in revenue while offering most educational content for free, targeting a $100M milestone. | |
| Networking and Strategic Capital for Expanding Startups | 8 | 0 | 1 | 2 | Lemkin advises European founder Anthony on US expansion networking tactics and gives a clear decision framework for when to accept non-essential venture capital to hire executive VPs in parallel. | |
| Hiring Playbooks for Sales and Customer Success Leaders | 9 | 0 | 0 | 2 | Lemkin outlines explicit hiring rubrics for first VP of Sales and VP of Customer Success hires, including the 30-day ringer test, fast termination protocols, and requiring hands-on product depth. |
Statements from this episode (24)
Lemkin: HubSpot survived 75% NRR up to $30M ARR
“They had low NRR all the way until 30. They were aware of it, but, you know, startups that I work with closely are invested in. If they got all the way to twenty-five million with 75% NRR, I would tell them to quit today, right?”
Lemkin: Startups should set C-10, C-60, and C-90 operational plans
“The 60 is probably where your core plan should be. We have a 60% chance thinking we can do it. More likely than not, but barely. That's how you build your core model. Your core model's for sales, for marketing spend, for hiring and engineering and product. And…”
Lemkin: VCs now expect 100% YoY growth at $100M ARR
“Investors are hoping for a hundred percent growth at a hundred million ARR. That's what you can back into. Today, and it's crazy, investors want a hundred percent growth at a hundred ARR.”
Lemkin: Blaming slow growth on fundraising makes founders look like losers
“The loser-ist thing as a founder you can say to a VC, right, they make you sound like a loser, and I literally never use the word loser, right, it's terrible, but it's true, is we didn't grow that fast last month because we were fundraising.”
Lemkin: Y Combinator combines prestige of Harvard, Stanford, and MIT
“YC is Stanford, Harvard, MIT, and Caltech all rolled into one. And even if you don't learn a goddamn thing from the program, It, all things being equal, you might as well go to Harvard or Stanford or MIT, right?”
Lemkin: Undecided founders should always join Y Combinator for institutional signaling
“If you're not sure, I always tell founders, just do it. Even if you have the revenue, even if you have, if there's a missing slice, like, just go to Harvard, MIT, and Stanford, get it done, and it's worth it, right?”
Lemkin: Startups cannot scale software revenue until two sales reps hit quota
“Do whatever it takes to get two reps hitting quota. Whatever it takes to get two reps to hit quota. You'll never scale revenue if you can't get two people to hit quota.”
Lemkin: First software sales hires must have sold at comparable ACVs
“When you hire your first couple reps, they do need to have sold a software product And I vaguely similar, something, at least at vaguely close to your ACV, like they can't have sold pool equipment or plastic. I sometimes people hire that. I all, it can work ou…”
Lemkin: Hiring a sales leader before two reps hit quota is risky
“Like it's hyper risky to hire a head of sales, even a stretch one before you have two reps that hit quota because a head of sales job is to hire reps three through 300, not to create product market fit, not to create the playbook, but to take a really rough pl…”
Lemkin: Hire a senior demand gen marketer once you reach 10 to 20 customers
“As soon as you have even a hand, 10, 20 customers, you can hire a great senior growth marketer demand gen to get you more leads. So hire that person as early as you can find her or him.”
Lemkin: SaaS giants like Zendesk and Intercom offer shitty phone support
“Even support companies do shitty support, and I go on, and I play, I go on to all the leaders, the, I, okay, does, do all the leaders in SaaS, do the Zendesk and the intercoms, and do they answer their phone and say, none of them do either, right?”
Lemkin: Upgrading support drives sales without shipping new features
“Even if you don't ship another feature this year, you can go back, and you can upgrade your support next week, and you can do some of it next week, and you can do over four to six weeks, and your MPS will go up, your sales will go up a little bit, Your NRR wil…”
Lemkin: SaaStr pays Marketo $100k annually but gets no phone support
“We pay Marketo, like, a 100,000 dollars a year. I can't get anybody on the phone, right?”
Lemkin: VCs actually prefer investing in bootstrapped companies
“Investors prefer, actually, if anyone thinks investors don't prefer bootstrap companies, you're wrong.”
Lemkin: Bootstrapping a startup typically takes three to four years longer
“It typically takes three to four years longer being bootstrapped.”
Lemkin: Bootstrapped and VC-backed SaaS companies converge at $10M ARR
“By ten million or so in ARR, you have convergent evolution. These paths converge. By ten million ARR, you have, if you bootstrap to ten million ARR, you're generating enough cash to hire all the VPs you want, ok?”
Lemkin: SaaStr lost $10 million in 2021
“Sastr itself, you know, basically has broke barely, well, it lost money. It lost ten million last year, broke even.”
Lemkin: SaaStr will generate $27 million in revenue in 2022
“So SAS took a long time, but we'll do twenty seven million this year.”
Lemkin raised $8M on a $2M pre-money valuation for his first startup
“The first time I got the world worth deal, I raised eight on two.”
Lemkin: Beyond $1M revenue, scaling becomes entirely about recruiting executives
“What, because this is all about, once you hit even a million in revenue, it's all about who you can recruit, right? Before that, it's your founding team.”
Lemkin: New sales leaders fail if they cannot bring reps with them
“Even if they're a stretch VP, even if they're, this might be their first VP role, if they don't have one or two queued up, zero approaching zero percent chance they make it.”
Lemkin: Replace new sales leaders by day 60 if hiring stalls
“If they don't have anyone good in 30 days, realize by day 60 you may need to move them out, as painful as it is, right?”