A Lead Gen Go-To-Market Cheat Sheet
Some founders are able to launch a product and get a bit of early traction without sales or marketing. There are two common situations where this happens.
The first is if there is incredible product-market fit and some virality or network effect built into the product itself. A few users beget a few more users and so on and the company grows organically. You see this most often in a product-led company where the product is intended to be purchased in a self-service manner without interacting with a salesperson.
The second case where initial sales & marketing aren’t needed to launch a product is when a founder has a built-in network of ready buyers and lands initial customers through their own efforts. Even founders who aren't comfortable selling can usually land the first 10 customers themselves, if not the first 50, or have an early employee who is able to do some selling like this.
Regardless of how a company lands its first batch of customers, there comes an inflection point when it’s time to build a go-to-market machine in order to grow beyond what can happen organically or via a founder’s efforts. When that moment happens is unique to each company—it might be $2m or $20m or even $100m in ARR.
If you’ve grown thus far based on organic network effects or founder-led selling, how should you go about launching your sales & marketing efforts? Some founding teams just instinctively know how to get their go-to-market programs off the ground. And others recruit experienced team members who have done it before.
No matter how you go about launching your sales & marketing efforts, it’s important to understand a few fundamental concepts in order to successfully scale. Mastering the building blocks will help pave the way for success, and spot potential problems before they throw you too far off course.
If you’re product-led and growing organically, there are numerous ways to go about building a scalable GTM machine, including layering in some product-led sales motions. That’s an article for another day. But if you are sales-led, then the approach to building your scalable GTM machine is actually surprisingly straightforward.
Fundamentals of Building a Successful Sales-Led Machine
Everything about a sales-driven growth motion comes down to funnel math. If you are going to grow with a sales team, you’ll need to fill your funnel with leads.
There are two ways to fill your funnel—outbound lead gen and inbound lead gen.
Outbound Lead Generation
Outbound is the process of proactively reaching out to target accounts in order to gain their attention and interest in your product.
Outbound takes effort & patience to launch, and there are nuances for each industry you are targeting. But at the end of the day, outbound is outbound and the steps are the same:
Create highly targeted lists of prospects based on your ideal customer profile. There are lots of tools and websites to help create these lists at scale.
Conduct outreach to the list of prospects. This is normally called a cadence or sequence and might involve a series of 8-14 calls, emails, and social touches over a period of 4-8 weeks.
When you get a prospect interested take them through a process to bring them into your sales funnel. If they aren’t ready to actively explore or evaluate your product, continue to nurture them and keep them engaged over time so that when they are ready, they think of you and reach out.
Outbound is very quantitative. The qualitative part comes down to executing well—having an accurate list of prospects, great messaging in your cadence, and smart, buyer-centric team members conducting the outreach.
The quantitative outbound math might look something like:
Conduct outreach to 200 contacts running a cadence of 12 touches over 8 weeks to the contacts.
Book 10 meetings from the outreach.
If the prospects are qualified and the salesperson is skilled, perhaps 4 of the meetings move forward to qualified opportunities.
If you have a 25% win rate on qualified opportunities, your land 1 new customer from the initial outbound list of 200 contacts.
You can use this basic math to model out what it will take to land n new outbound customers. The math above is just an example, every company’s math might be slightly different depending on what they are selling and who they are selling it to.
There is no magic to it, it’s just math. There are also no halfway efforts and no real success without a significant, sustained volume of outreach. Trying to outbound to 200 contacts and saying it doesn’t work is short-sided. As is thinking you can outbound to 200 contacts and call it a day.
Outbound means building big, highly targeted lists of your ideal prospects. If something in your outbound funnel math isn’t working it’s usually pretty simple to diagnose and it’s likely one of four qualitative elements.
The quality of the prospecting lists.
The effectiveness of the messages and communication used in the cadence.
The skill of the sales reps.
Your offering (but if you have already been landing customers before outbound, it’s probably not your offering).
It can be one of these four things or a combination of them. So, if you are conducting high-volume outbound and you aren’t getting any traction, dig into those areas to determine what the cause is and execute corrective action.
In terms of what you can expect with an outbound approach, you’ll need to set some initial goals and be patient. If you don’t yet have your own benchmarks to use for goal setting, you can create some targets (use a more conservative version of my math above) and start tracking how your outbound program performs over time. Once you have results, you can create goals based on your own, actual benchmarks.
And, given the effort to launch and run a high-performing outbound program, is it even worth it?
Unless you have more than enough qualified inbound leads, yes. Even in cases where you have plenty of qualified inbound leads, an outbound program ensures your team isn’t only relying on marketing to toss leads over the fence. This makes for more predictable results if marketing ever does hit a road bump with lead generation.
Inbound Lead Generation
Inbound lead generation is the result of marketing programs designed to attract quality leads into your funnel. There are a wide variety of ways to generate inbound leads—categorizing them as indirect and direct is an easy way to think about them.
Indirect methods include initiatives that drive awareness for your brand, such as PR, podcasting, speaking at industry events, sponsorship of industry events or associations, social marketing, print ads, etc.
With indirect methods, you will attract people to your brand, and you may also help support outbound by making your brand better known to your prospective customers. You won’t always be able to know where the lead originated from (where the lead first heard about you). The concept is that if you expand your awareness with your target audience, you will naturally increase interest in your product and subsequently drive leads organically through that awareness.
Direct methods involve intentional initiatives designed to get in front of your target audience and bring that audience into your funnel through lead generation tactics.
Direct methods of lead generation can include organic search engine optimization, paid search, paid advertising, account-based marketing, cost-per-lead marketing, exhibiting at trade shows, etc. As people interact with your brand you optimize your website or landing pages in order to increase the chances a prospect will convert to a lead by completing a form, interacting with a website chat feature, or calling your sales phone number (or letting their badge be scanned in the case of a trade show). When this happens the unknown prospect becomes known and can now be considered a marketing-generated lead.
There are different types of marketing-generated inbound leads. With outbound sales, the outreach is specifically designed to get in front of high-quality, targeted customers so there is just one type of sales-generated lead. But with marketing-generated leads, all of them won’t be equally qualified, so there is usually a manual or automated assessment that is done in order to ascertain the quality of the lead. For example:
Hot inbound leads are those who request a demo, or pricing, or reach out to talk to a salesperson. Hot inbound leads are the most likely to convert to new customers as they are expressing an interest to engage in a sales process.
Marketing-qualified leads (MQLs) are a subset of marketing-generated leads, and they are typically the leads that best fit your ideal customer profile. This might be because of their title, their industry, company size, or region.
Many companies score or grade their leads in order to assess quality in addition to tracking hot inbounds and/or MQLs.
Because not all leads are of the same quality or sales readiness, a big part of marketing lead generation is nurturing the leads in order to get them more interested in your product over time. This is done via tactics like sending newsletters, holding webinars for your audience, developing whitepapers and tools that support the lead’s evaluation or consideration of your product, etc.
The more value you bring to your lead nurturing, the more effective it will be and the faster you will get a cold marketing-generated lead to be a hot, inbound lead. Lead nurturing shouldn’t just be telling your leads about your brand. Rather, it should be designed to provide your leads with valuable information that helps them in their profession, or that is educational in nature.
There are a wide variety of strategies and tactics that support the success of both indirect and direct methods of lead generation. These include content marketing, positioning and messaging, public relations, analyst relations, paid strategy, sales enablement, etc.
Like outbound, there is funnel math that applies to marketing-generated leads, and the math may be different for different types of leads.
The quantitative inbound math for a hot inbound lead might look something like:
20 hot inbound marketing leads delivered to sales.
10 of the leads are qualified and become sales opportunities.
If you have a 25% win rate on qualified opportunities, your land 2.5 new customers (on average) from the initial 20 hot inbound leads.
The math is probably similar for an MQL and will be a bit less effective if you do outreach to all marketing-generated leads. Doing sales outreach to marketing-generated leads is similar to doing outbound to cold leads. The sales team can reach out to leads who come into your marketing-generated funnel via assets like whitepapers or other campaigns and do a light follow-up cadence to get the lead engaged and hopefully create interest in evaluating your product.
Sales Process
So, all sales-driven go-to-market strategies are based on filling the funnel with outbound and inbound leads. Beyond that, there are a few other elements that can impact overall success and growth rate. The biggest one is probably the sales process.
Driving all the leads in the world won’t help if there isn’t a skilled team to bring your prospects through the funnel and land them as new customers.
While we could write a book on sales process best practices, there are a few things to keep in mind as you develop your scalable go-to-market to drive growth. These include:
Make sure everyone on your team is following the same sales process. This includes using the same approach to qualifying prospects, the same definitions for sales stages in your CRM, the same approach to demoing and conducting discovery. Without unity across your sales team, it will be hard to measure what’s working and what isn’t. And it will be equally difficult to create your own funnel math benchmarks as your sales team matures. Having your own benchmarks makes predictable, forecastable growth much easier.
Design all the interactions your team has with your prospects to be buyer-centric. It should be easy and valuable to interact with sales in order to get pricing, a demo, or do a deeper evaluation of your product. There is no need to make prospects jump through hoops in order to talk to a sales rep or get the information they need in order to evaluate you.
Avoid spending too much sales time on unqualified leads, but also don’t overly keep leads away from sales. It’s a delicate balance. An unqualified lead today can be a qualified one tomorrow. Ensure you are making it a smooth, easy road for prospects to get product information they need and can get to your sales team for questions.
Create the sales enablement pieces your buyers need to evaluate you. This might mean recorded demos or videos, one-pagers, sales presentations, deep-dive product white papers, case studies, etc. The best sales process with the highest quality leads is made infinitely more difficult without strong sales enablement.
When You Are Lost, Come Back to Your Funnel Math
I can’t say this enough, and it’s a fundamental simple truth: If you have product-market fit (a great product that a large enough audience needs), and your primary way to land new customers will be via a sales team, then hitting your growth targets starts and ends with funnel math. And it’s not more complicated than that.
Yes, of course, there are many qualitative aspects of growth (pricing, positioning, messaging, targeting, product, competitive landscape, etc), and those are only lightly touched on here. But the qualitative aspects only matter when you think in terms of creating a funnel and driving more leads into, and through, the funnel. It bears repeating—sales success starts, and ends, with the funnel. All the qualitative elements won’t get you anywhere without a funnel filled with leads.
You can use the funnel math to set your bottom’s up growth targets, then set sales and marketing goals to hit the numbers indicated in your funnel math. When you do this, everything you do to from a sales and marketing perspective should be done in service of hitting the funnel targets.
If you miss a growth target, it’s because something in the funnel isn’t working as planned. If you have a GTM Operating Cadence then you will quickly spot what’s not working and be able to rectify it before you really get behind your targets.
If you are an Arthur Ventures portfolio company and would like to see examples of funnel math models, please reach out to us.