In this episode of SaaS Half Full, Lindsey Groepper chats with Nikki Parker, SVP at Insight Partners, about funding milestones throughout the scale-up journey and the role of a CMO throughout.
Insight Partners has invested in over 400 software companies, and Nikki has seen the highs and lows of milestones and funding announcements. What is essential to the VC vs. the portfolio CEO? What are the realistic expectations? Find out more about Nikki’s perspective on goal setting and leveraging marketing to reach business outcomes throughout the SaaS growth journey.
Why should SaaS companies announce funding?
Funding announcements serve two significant functions — its role in overall corporate communications (the story your brand tells over time) and the media relations output (the press coverage achieved from pitching).
Corporate communications enables companies to control their brand messaging. Releasing funding announcements through press releases or corporate statements, according to Nikki, “allows you to put the stories in your voice as your point of truth.” Additionally, releasing funding announcement press releases allows companies to build a digital track record of their progress, making the data easily accessible to review and reflect on over time.
Secondly, Nikki supports strategic media relations around funding announcements, realizing the magic comes from the pitch, interviews and press coverage that follows…not from issuing a press release alone.
“By separating corporate communications and media relations, you’re able to, in my opinion, build a far more robust and in-depth narrative that will resonate with as many audiences as possible,” said Nikki.
What is the business goal behind the funding announcement?
Nikki’s seasoned expertise has found that the business goal drives the most successful funding announcements. There are several different business goals for the founder and it’s essential to define what it is before writing the release.
You need to decide if the goal is to announce as quickly as possible, close more business or attract new talent (or a combination of goals). The desired business goal will determine what you can expect as an outcome. If you want to get the announcement out as soon as possible, then press coverage will be low due to time constraints on pitching, reducing the overall visibility of the announcement. If your goal is to gain visibility to prospects and potential employees, you’ll need time to seed the release and tell different stories to target the press.
“The most important thing [with your current announcement] is your next announcement,” said Nikki. “What am I seeding within this to make my next announcement or my next public launch or statement a proof point? It shows that I deliver on what I said I was going to do; being that thoughtful every time you go out to the media or create a corporate communication statement is critical to building long-term success.”
Funding Announcement Expectations for VCs and CEOs
Knowing what matters to the VC vs. the CEO can help manage funding announcement expectations.
The VC wants the portfolio company to be the star, putting the company in the spotlight. It’s more important to the VC that the main message in the release extends beyond the fact they invested into why they invested. CEOs, however, do want their company as the focus to drive as much visibility for the company as possible, define how the funds will be used and seed messaging about what’s next for the brand. The CMO? Well, she is trying to balance the needs of both.
The Role of the CMO in a scaling SaaS Company
Depending on investor size and company stage, not all VCs will have an in-house communications specialist and not all portfolio companies will have a CMO to lead funding PR initiatives. At what stage do SaaS companies hire a CMO? Companies often fall into two categories: the more product-led and technical founders tend to hire marketing leaders later in their lifecycle, while more visionary, sales-first founders tend to engage marketing leaders earlier.
When looking for your first marketing leader, Nikki believes it’s crucial to hire someone who can unite brand and performance marketing. “Companies that are doing this earlier, more thoughtfully and doing it well, they’re the ones that are going to be category creators and category kings going forward,” said Nikki.
“The CMO is simply a business leader with a propensity for marketing,” she continued. “You must have someone who can understand the business goals, use marketing to help reach those goals and figure out the tactics that will get you there.”
For more of Nikki’s insights, listen to Episode 315 of SaaS Half Full.