How to grow your startup in the midst of a recession?

The intention of this article is to help entrepreneurs who are focused on growing their company’s sales, and this is for companies that have already established product/market fit, already have paying customers, and are now ready to scale up through digital marketing, inbound sales, and outbound sales.

If you want to grow, implementing all three of these disciplines properly is absolutely essential. And I know you want your business to win:

Step 1: Scalable Advertising - Growing Rapidly By Investing in Profitable Ad Spend

Growth is a function of = Scalable Advertising + Inbound Sales + Outbound Sales

Regardless of whether you’re a B2B company (selling to businesses) or B2C company (selling to consumers), the foundational element to growth is scalable advertising. Without it, your lead volume will never be high enough to get past $5M in annual sales -- a common place that many companies plateau at.

I call it “Scalable Advertising” because it is profitable advertising that is done with rigor, clear tracking, and an analytical mind. When you advertise with rigor and tracking set up properly, you can know immediately if a campaign is profitable or not.

Many CEOs I talk to don’t understand how to scale their advertising. They either don’t advertise their products and services at all, or if they do, they throw money at Facebook ads or agencies without clarity first on what they can afford to acquire a customer.

So here’s how you figure out how much you can spend to acquire a customer.
There are two key elements you must know to set the foundation for scientific advertising:

  1. Lifetime Value (LTV) = How much a customer spends with you during the lifetime of them being a customer.

  2. Maximum Customer Acquisition Cost (Max CAC) = How much you’re willing to spend to acquire an incremental customer up front. This should be a percentage of your lifetime value, roughly between 5% and 33% of your total lifetime revenue from the client, depending on how fast you want to grow and your profit margins.

How to Calculate Your Company’s Lifetime Value (LTV)

Here are three examples so you can learn how to calculate your own company’s lifetime value (LTV):

Example 1: Subscription Business ($50/Mo.)

For example, if you run a subscription business in which customers pay you $50 per month and on average stay around for 12 months before cancelling, then you have a Lifetime Value (LTV) of $600. Knowing that you make $600 in sales from an average customer -- you can then decide how much of that amount you’d be willing to spend to acquire a customer up front. Depending on your margins and how fast you want to grow, you may choose to spend as much as $200 up front in advertising costs to acquire a new customer.

Example 2: B2B With Large Contract Sizes ($75,000)

As another example, if you sell to businesses and your average Annual Contract Value (ACV) is $75,000 and your customers stay 2 years on average before cancelling, then you have a Lifetime Value (LTV) of $150,000. Depending on your margins and how fast you want to grow, you may choose to spend as much as $50,000 up front in advertising costs to acquire a new customer.

Example 3: Consumer Retail ($65/order)

As a last example, if you sell retail products to consumers and the average order is $65 and an average customer purchases 3 times in a year, then you know you will make $195 in sales from a single customer in a year. Depending on your margins and how fast you want to grow, you may choose to spend as much as $65 up front in advertising costs to acquire a new customer.

What To Do As a Venture Backed Company?

Venture-backed companies, or those with lots of cash in the bank, who want to grow at 100%+ per year often will spend 25-35% of the lifetime value of their customers up front in customer acquisition costs across channels like Facebook, Instagram, LinkedIn, Google Adwords, Google Display Network, YouTube, affiliate marketing, radio, television, and direct mail. They will either hire an in-house team or an external agency (We can Help you doing this)

What To Do As a Non-Venture Backed Company?

If your company isn’t venture-backed (99% of companies aren’t) and you’re managing cash closely and don’t have a huge buffer to fall back on, start by setting your Maximum Customer Acquisition Cost (Max CAC) at around 10%of the lifetime value of an average customer, and then building up as you go.

● If for example you get an average of $150 per month for 30 months from your customers before they cancel, then you have a lifetime value of $4500 and you can spend around $450 in upfront advertising costs to get an incremental new customer -- while still maintaining a healthy cash balance.

● If for example you get an average of $100,000 per year for two years from your customers before they cancel, then you have a lifetime value of $200,000 and you can spend around $20,000 in upfront advertising costs to get an incremental new customer - while still maintaining a healthy cash balance.

Step 2: Inbound Sales - Building an Automated Inbound Sales System That Turns Your Leads Into Paying Customers

The Steps to Automating Inbound Sales

    1. Get your leads coming into a CRM system like HubSpot, Salesforce, or Ontraport

    2. Create an automated 180 day follow-up sequence to build rapport and credibility with your leads, sending high-quality content automatically every 5-10 days. Include information about your business and your products and services with each message.

    3. Turn on an omnipresence retargeting campaign. Use retargeting on Facebook and Google Display Network to show ads to your web site visitors and to your leads to create the impression that your brand is everywhere online and to re-engage them in the sales cycle with additional reports, downloads, lead magnets, and more.

    4. Have your Sales Development Reps (SDRs) follow-up immediately (ideally within 1 hour) for every lead that comes in. The companies that grow are the companies that follow-up with every single lead within 60 minutes of it coming in (during business hours). The companies that don’t are the ones that take 3 days to reply. Speed wins. Create the rule that any leads that come in that day must be followed-up with before the day is over.

    5. Use SMS and WhatsApp when possible. When a lead comes in, if you’ve collected the mobile phone number of the lead, have your Sales Development Rep (SDR) immediately send a personal 1:1 text message to the lead to engage them immediately. If what you’re selling usually requires a phone call, have the SDR offer to get on the phone with them right then. Speed and personal connection wins.

Step 3: Outbound Sales - Creating a Growing Pipeline of Vetted Leads for $10K+ Deals

Let’s say you sell accounting audit services with an Average Contract Value (ACV) of $50k per year to companies with $10M to $200M per year in sales in the United States and that the decision maker you are selling to is the CFO and Controller.

With this example, your Sales Development Representatives (or your outsourced agency like RevenueAccelerator) would:

  1. Go on ZoomInfo, Uplead, or Seamless, all sources of contact information for B2B sales leads.

  2. Create a list of the prospects who fit the criteria of the people you are targeting. For example, all the CFOs and Controllers in the USA at companies with $10M to $200M in sales yields 43,267 results on Uplead.

  3. Download this list of leads (or a smaller portion of the list you want to start with). The cost per lead usually ranges from $0.05 to $0.50 per lead depending on how many you buy at once. Seamless also offers an unlimited plan. Only download the leads you actually plan to reach out to within 72 hours. Never let lead data go stale.

  4. Use a tool like YAMM,, Outreach, or Hubspot(or your email inbox for slower speed) to send a customized 1:1 email to each prospect, demonstrating that they have spent time to research the person (via LinkedIn) and the company (via the web site).

  5. Using the above tools, one Sales Development Rep (SDR) can send out around 100 of these customized 1:1 emails per day (or as many as 200 if they are partnered with a data research associate who writes the custom text that goes out to each lead). You can also follow the same strategy using LinkedIn InMail and Linkedin Sales Navigator. Be sure that you have entry-level SDRs sending out these messages (at $50k or so compensation packages) and not $150k per year sales executives -- or the economics won’t work.

  6. The goal of these 1:1 messages should to be to demonstrate you’ve done real research on the company and get the person to reply. Then, your SDR can build a relationship and set up a Zoom Meeting or Demo with for your Sales Executive.

  7. If you don’t want to do this in-house, we recommend using a sales development agency like Revenue Acceleratorout of Vancouver, Canada to do this for your company on a retainer + per meeting cost.


- By Ryan Allis.


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