SaaStr 227: Why Deal Size In The Early Days Does Not Matter, Why TAM In The Traditional Sense Barely Matters & Why You Have To Invest In Customer Success Before You Think You Need It with Alexandr Wang, Founder & CEO @ Scale

Alexandr Wang is the Founder & CEO @ Scale, the startup providing high quality training and validation data for AI applications. To date, Alexandr has raised over $23m with Scale from some of the best in the business including Index, Accel, Y Combinator, Dropbox’s Drew Houston, Justin Kan, Thumbtack’s Jonathan Swanson and more. Prior to founding Scale, Alexandr was a Tech Lead at Quora, directly responsible for all speed projects and before that a software engineer at Addepar responsible for building and maintaining financial models.

In Today’s Episode We Discuss:

• How did Alex make his way into the world of SaaS and come to found Scale? What were some of his biggest takeaways from seeing the first hand scaling of Quora and Addepar?
• Why does Alex take the contrarian view that “TAM in the traditional sense barely matter”? What two characteristics of the market should founders really look to examine? How does Alex approach the element of market sizing? Does he prefer top down or bottoms up and why?
• Why does Alex believe that you must invest in customer success before you think you need it? What were the benefits for Alex of investing early in customer success? Why does CS over sales ultimately drive the growth of your company? How does one know when is the right time to hire their first in customer success? What is the ideal profile of this candidate?
• How does Alex think about the integration of customer success and product teams? Why is it crucial from the product perspective that founders pick their first customers well? How can your customers drive your product decisions? How can one ensure to be customer informed and not customer driven?     
• Why does Alex believe that in the early days it is not important to focus on the size of the deals you are signing? What should founders be focusing on with these early customers instead? When is the right time to flip the switch and opt for value extraction as a more primary objective? How does Alex respond to the fact that VCs often look at these first customer deals as an indication of the size of the pain point you are solving?  

60 Second SaaStr:

1. What does Alex know now that he wishes he had known in the beginning?
2. What does Alex believe is the hardest role to hire for today?
3. Who does Alex think is crushing it in the world of SaaS today?

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Jason Lemkin

Harry Stebbings

SaaStr

Alexandr Wang