SaaStr · 2012-10-16 · 4978d

Scaling in SaaS: Why People Scale Harder Than Product

Jason Lemkin argues that while scaling SaaS product infrastructure is 10x easier than consumer internet due to lower computational demands, scaling the organization is significantly harder. SaaS companies require diverse functional teams (marketing, sales, support, business development) much earlier than consumer companies, and founders must commit 50% of their time to recruiting leaders across unfamiliar areas or risk failure.

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Metrics in this report

Annual Recurring Revenue Target

1,000,000$

baseline

minimum ARR milestone requiring full functional team

Founder Time Allocation to Recruiting

50%

recommended minimum

for successful scaling of SaaS company

Infrastructure Capacity per Server Cluster

1,000,000users

median

EchoSign historical performance