Apr 6, 2020 · 24m · top-founders
1717 3 Genius Ways To Conserve SaaS Cash To Survive Virus From Eloqua Founder Who Survived 9/11
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Host Nathan Latka interviews Eloqua and Influitive founder Mark Organ to discuss tactical crisis management frameworks, aggressive cost-cutting methods, and employee equity swaps designed to help SaaS companies survive macroeconomic downturns.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Nathan holds 39.9% of the talking time here. How this is scored →
Nathan as informed peer 5.4 Guest teaching 4.1 Guest disagreement 1.5 Nathan pushing back 2.1
speaking balance: gold is Nathan, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 5:18 Organ dismisses concern over restaurant workers in favor of tech survival
Organ rejects Latka's moral framing regarding government stimulus distribution, unapologetically arguing that venture-backed software firms create sustainable, high-value jobs that are more important to protect than food-service roles.
Hardest push from Nathan ▶ 4:18 Latka challenges the ethics and optics of VC-backed bailoutsLatka calculates exact PPP payouts for venture firms and pushes Organ on how an average laid-off worker would perceive a multi-million-dollar VC-backed startup taking taxpayer relief.
Biggest teaching moment ▶ 22:02 Organ delivers crisis downsizing framework for engineering versus salesOrgan educates the audience and host with a sharp operational model, outlining strict six-month payback thresholds and the necessity of pausing long-term Horizon 2 and 3 product development.
Nathan holds their own ▶ 16:10 Latka synthesizes complex equity dilution model into clear mathLatka demonstrates sharp financial modeling acumen by flawlessly distilling Organ's multi-step equity compensation restructuring into an exact, easy-to-understand two-percent cap table summary.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Nathan as informed peer | Guest teaching | Guest disagreement | Nathan pushing back | Why |
|---|---|---|---|---|---|---|
| Podcast Scheduling Changes and iTunes Review Callout | 5 | 1 | 1 | 1 | Latka opens with an extended monologue about podcast scheduling and iTunes reviews before introducing Mark Organ. Latka establishes high macro context around the newly launched PPP stimulus program and the affiliate rule controversy. | |
| Justifying Government Relief for Venture-Backed Software Companies | 6 | 3 | 5 | 6 | Latka pushes Organ on the optics and ethics of VC-backed firms taking taxpayer stimulus checks away from laid-off restaurant workers. Organ responds bluntly, stating software creation is ultimately more valuable to the economy than serving food. | |
| Tactical Cost-Cutting: Rotating Furloughs and Bottom-Up Layoffs | 4 | 6 | 1 | 2 | Organ shares tactical playbooks from his coaching clients, including rotating four-day furlough schedules and bottom-up headcount rebuilding. Latka probes for operational specifics on salary reductions and reduction-in-force methodologies. | |
| Swapping Cash for Equity: The Eloqua Post-9/11 Playbook | 6 | 6 | 1 | 2 | Organ explains his post-9/11 Eloqua playbook of letting employees purchase stock at 10 cents a share with their compensation to extend cash runway from 4 to 9 months. Latka works through the corporate valuation mechanics and cash conservation math in real time. | |
| HostGator Platform Sponsorship and Promotional Offer | 7 | 4 | 1 | 3 | Following a brief mid-roll ad read, Latka quizzes Organ on common stock versus option pool dilution and investor sign-offs. Latka cleanly articulates a two-sentence mathematical summary of the equity swap framework, earning Organ's full endorsement. | |
| Runway Targets and Unlocking High-Margin Professional Services | 6 | 6 | 1 | 2 | Organ argues companies need a minimum nine-month runway and should pivot into high-margin in-house professional services to achieve profitability. Latka contributes domain framing on product-enabled services and charging for upfront needs analysis. | |
| Downsizing Frameworks: Engineering vs. Sales Headcount Decisions | 4 | 7 | 2 | 1 | Latka asks whether a cash-strapped founder should cut engineering or sales headcount. Organ provides a comprehensive ROI framework, advocating cutting unramped sales reps and eliminating long-horizon product investments in favor of immediate churn reduction. | |
| Interview Conclusion and Core Strategy Recap | 5 | 0 | 0 | 0 | Latka concludes the interview with an efficient solo summary of the three main cash-conservation takeaways discussed before signing off. |
Statements from this episode (12)
Organ: Founders should take available government stimulus cash
“I would say that as a founder, if you have an opportunity to get cash from the government at this point, like I try to do it. And you're certainly going to pay enough in taxes over your lifetime. So if this is your one opportunity to get a little bit, then sur…”
Organ: Venture-backed software jobs are more important than serving food
“You know, the restaurant business is not actually one that is sustainable. That doesn't sustainably create lots of, you know, lots of, you know, high tech Innovative jobs. Whereas I think what I'm doing does. So I know that might sound selfish, but I don't thi…”
Organ: Founders planning layoffs should build headcount up from employee one
“What I encouraged was to start from literally employee one. So I'm employee one, the CEO. I'm the first employee. Who else do I absolutely need? Okay. I need someone in finance. Okay. I need one person in marketing, whatever. So build up from the bottom instea…”
Organ: Post-9/11 equity swap extended Eloqua's runway from 4 to 9 months
“That extended our life from, we had four months of cash remaining, and it went extended from four months to nine months.”
Organ: Junior Eloqua employees made $10M+ when Eloqua went public
“And so we gave a lot of stock, and as a result, there's, you know, a number of you know, there are some pretty junior folks at Eloqua that are, you know, made ten million dollars plus when Eloqua went public.”
Organ: Employee equity swaps are one of the best crisis moves
“And actually, I think that's one of the best things that you could do at this time. Again, you strengthen the company, you raise more cash. The employees are super motivated. So it's a good move.”
Organ: Nine months is the minimum runway required to reach profitability
“So I think in nine months most good founders, founders and CEOs can figure out how to get their company a profit. And so nine months to me is the absolute minimum of time that you need.”
Organ: SaaS customer churn will rise by 10 percentage points during downturn
“So typically what I'd say is that churn is going to go up by 10 points. So if you're used to, 20% churn. I might go up to 30% churn. And your new sales growth is going to be, you know, pretty, pretty anemic in terms of ARR.”
Organ: SaaS companies can charge $10,000 for upfront needs analysis proposals
“If you're the expert, you can actually charge someone 10,000 dollars to understand their needs in great detail and give them a proposal that they can then use to, they can hire you and your software, or they can go to your competitor. But most likely they're g…”
Organ: Founders should cut ramping sales reps first during a crisis
“In a time of crisis, your cost of capital is enormous, which means that you need to get payback very quickly with a high level of certainty. So a new sales rep is going to be a very uncertain investment. It's going to take too long. So if you've got four reps …”
Organ: Fire or reallocate engineers lacking a six-month payback during crises
“If the engineers aren't working on stuff that is going to generate a payback within six months, then they need to be reallocated or they're gone. So that's what it's all about. It's all about how do I get payback within six months, and I want to get at least a…”