Thread by @jasonlk

There's a moment in time in every SaaS company where money doesn't really matter anymore. You have enough to hit your goals.

And there's a much earlier moment in time where every single dollar matters.

Between the two is the art of investing your balance sheet as a SaaS CEO

Invest too little in this phase, and you waste time. Sometimes a lot of it.

You don't hire real VPs. You don't build that integration.

You'll look back and deeply regret wasting this time.

Invest too much in this phase, and you probably don't go bankrupt, but you overspend and have to painfully hit the brakes

This is equally brutal and can set you back a year or more

A few simple thoughts:

1/ Find a way to make every accretive hire after $2m ARR. Just find a way.

After $2m ARR, every great engineer, every great AE, every great CSM will pay for themselves

Just not in a day

2/ Remember the Balance Sheet Rule

You want to have at least 50% of your ARR on your balance sheet. If you don't, you will underinvest. Always.

So at $4m ARR, you need at least $2m inbank to invest

At $10m ARR, you need at least $5m in bank to invest

As CEO, get it done

3/ Don't underhire in this phase ($2m-$10m ARR, usually)

This also subtly sets you back months and often even a year

After $2m ARR, it's OK to make a stretch hire

But a stretch hire that is a real VP. Not a manager.

This doesn't save money. It costs money.

A related post here:

saastr.com/from-initial-t…