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How Pavilion Creates Over $10M ARR Through Efficient Growth & Extreme GTM Alignment

Sam Jacobs · Pavilion

Published September 6, 2024
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What you’ll learn

Sam Jacobs explains Pavilion’s shift from growth at all costs to profitable, efficient growth. He connects retention, unit economics, payback periods, onboarding, and GTM alignment to sustainable recurring revenue.

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Retention drives recurring-revenue value

“you do differently in this modern world and none of this should be rocket science but I want to underscore a couple things that you can do to align your business around profitable efficient growth what we know is that uh again no no uh nothing revelatory here retention drives all valuation for recurring Revenue businesses right and that sounds obvious and yet if we go into a boardroom most of the time historically we've been talking about the sales funnel uh all the way up to the point of sale we've been talking”

Calculate CAC and lifetime value correctly

“spend more than uh okay oh it's good we're fixing it on the Fly there we go oh it's beautiful all right there we go there we go okay so the point is does your team understand how all of this works do you understand how to calculate customer acquisition cost many people say that they do but then they don't uh do the calculations properly or they leave critical things out do you understand how to calculate lifetime value it's gross margin contribution per customer it's not Revenue per customer”

Understand the cost of long payback periods

“over a longer period of time the first is it requ it ties up your capital in in that sales cycle right so it's bad for your balance sheet but it also requires a much higher predictability and point of view on what's going to happen in the future so imagine that you have a three a three-year payback period what that means is you put a dollar in at the top of the machine uh in 2021 and you don't get that full dollar back until 2024 well has the world changed from 21 to 24 I would think we would all rades changed a lot so the other problem with long”

Orient onboarding around high-value actions

“make sure that you're driving your onboarding experience towards activities that you understand our different differentiators for your product and that will lead to high engagement post onboarding which would be you know the period from really 30 days into the customer Journey all the way up to the first renewal all right almost done last thing I will tell you is uh if you are an outbound driven or a human driven sales and marketing engine and you want to think about you know how do I make more money how do I lower my customer”

Understand Pavilion community scale

“Pavilion Today 10,000+ Global Members 450+ Cities around the world that are home to Pavilion members 47% Sales 27% Marketing 13% CS 9% Operations 4% Emerging Functions Members by Function 55% SMB 30% Mid-Market 15% Enterprise Companies by Size The World’s Largest Private Community For Go-To-Market Leaders and Their Teams”

Move beyond growth at all costs

“Growth At All Cost Since the summer of 2021, the growth rate has been cut in half… Annual 36% 18% 40% 30% 20% 10% 2021 2022 2023 2024 Revenue Growth Rate”

Balance customer and investor value

“Customer Value Investor Value ? The harder route The easier route”

Start with customer delight

“Moments that Matter: Start with Delight Aware Discover Consider Buy Adopt Use Renew Expand Attract Engage Delight 1 2 3 4 5 6 7 8”

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About the speaker
Sam Jacobs

Sam Jacobs

CEO and Founder · Pavilion

Company revenue
$10M

Slide text

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19 passages

Efficient growth and GTM alignment

  1. SaaSOpen, September 2024 How Pavilion Creates Over $10M ARR Through Efficient Growth & Extreme GTM Alignment Sam Jacobs CEO & Founder, Pavilion

  2. How it started…

  3. …how it’s going

Pavilion today

  1. Pavilion Today 10,000+ Global Members 450+ Cities around the world that are home to Pavilion members 47% Sales 27% Marketing 13% CS 9% Operations 4% Emerging Functions Members by Function 55% SMB 30% Mid-Market 15% Enterprise Companies by Size The World’s Largest Private Community For Go-To-Market Leaders and Their Teams

  2. Our Growth

  3. Customer Value Investor Value The harder route The easier route ? ? ?

  4. Our Growth Investor Value

Moving beyond growth at all costs

  1. Growth At All Cost Since the summer of 2021, the growth rate has been cut in half… Annual 36% 18% 40% 30% 20% 10% 2021 2022 2023 2024 Revenue Growth Rate

  2. Growth At All Cost …and the cost of acquiring new ARR has nearly doubled. 150% 264% 300% 200% 100% 2021 2022 2023 2024 Client Acquisition Cost as a % of Net New ARR

  3. Growth At All Cost NRR is experiencing a sharp decline, which will ripple through the first half of 2024. 113% 130% 120% 110% 2021 2022 2023 2024 Net Revenue Retention 123% 100%

Customer and investor value

  1. Customer Value Investor Value ? The harder route The easier route

  2. Companies that prioritize customer value build durable businesses.

  3. What Do Successful Companies Do To Grow Efficiently? Time Total Scalable Sustainable Durable Customer-driven growth surpasses growth from acquisition. Growth from customers comes at a lower cost. $10M $100M $1B $10B Revenue [mUSD]

  4. ONBOARDING AWARENESS EDUCATION SELECTION MUTUAL COMMIT ADOPTION EXPANSION Recurring Revenue is the result of Recurring Impact I Nailing Customer-Driven Growth

Creating delight across moments

  1. Moments that Matter: Start with Delight Aware Discover Consider Buy Adopt Use Renew Expand Attract Engage Delight 1 2 3 4 5 6 7 8

  2. Our Growth Investor Value

  3. Our Growth Customer Value

  4. The end of growth at all cost Next: Growth based on customer value Drive customer value by implementing moments that matter Summary 1 2 3

  5. SaaSOpen, September 2024 Thank you! [redacted email] Sam Jacobs CEO & Founder, Pavilion