5 Things I’ve Learned About Hiring Customer Success Leaders for $1-$10 Million ARR Businesses
By Alan Fecamp. Alan is a Director at Zeren, and leads our Customer Success hiring vertical from the UK.
Despite the well-publicised market headwinds in Technology and SaaS, the demand for Customer Success leadership remains strong.
It’s higher than ever!
CS leadership hiring growth is far outstripping CSM hiring globally, in terms of percentage. This is particularly apparent in earlier stage companies, where the appetite has grown considerably in recent years.
According to the recent Customer Success Index report from Gainsight and RevOps Squared, companies at $1-10 Million ARR have the lowest defined CS organisation, but 70% are either planning to have or already have newly-formed organisations.
They will naturally require a talented leader at some stage.
I’ve been fortunate to have helped many $1-$10 Million ARR companies build their Customer Success functions over the last six years, and there is no doubt that the attitude shift towards CS from Founders and Senior Management teams has been huge.
CS now has a seat at the table. Its role in a company achieving financial milestones is being recognised.
This is great to see, having felt the frustration from so many in my network about the attitude towards CS from their current employer – this is a major reason for a CS leader wishing to change roles.
It’s clear that businesses are now looking to hire this expertise earlier, and there are a few learnings I can share when setting out to get your first VP of Customer Success on board.
1. Hire a VP of Customer Success who has owned the business and not just borrowed the keys for a day.
If you are sure you are ready to hire a VP of Customer Success, aim to find one who has created and executed the playbook rather than delivered someone else’s plan.
There is value in knowing how to execute; however, being responsible for developing and delivering the whole strategy whilst likely reporting to the Founders, CEO and Board requires a different skillset.
Depending on the organisation’s stage of growth and maturity of the current CS structure, they are likely going to be met with a good dose of ambiguity to navigate and you’ll mitigate risk if they have been on a start-up journey before.
I’d caveat this. There are Directors and Heads of CS who are ready to take the step up. If they have seen multiple iterations of what good looks like and have worked with great leaders in the past as mentors, this would be the next best and great option to open the potential pool of candidates that is otherwise very limited.
2. Domain expertise isn’t a priority – the GTM motion of your company is.
Direct market knowledge should be trumped by experience with similar customer journeys and GTM motions.
If your organisation is product led, your CS approach will likely differ from a sales led business with a premium product.
If you’re in eCommerce for example, you can widen your criteria to include other B2B2C channels or even discount that completely in favour of someone who has experience with your customer size and type – high touch/high value vs mid-market – and similar revenue model.
If you have a consumption driven model, it’s likely the behaviours of the CS team will differ vs. straight, monthly SaaS license.
For me, matching on the GTM and CS motion is critical vs. your leader knowing the specific nuances of an industry, as this will likely impact the CS methodology they apply. For example, if you have high numbers of lower value customers and plan to continue with a volume driven expansion, you’ll likely need a profile with experience in building out tech touch and self-serve solutions.
If you are super high touch with your CSMs acting as strategic advisors with 3-5 customers with $ Multi-Million ARR responsibility, that should be your focus.
The domain expertise can come from their first few CSM hires if it’s needed or may already exist in abundance elsewhere in the business.
3. Evidence of team collaboration is crucial.
The right candidate will also have worked closely with Product, Sales, Marketing, and Support as all of these will impact on improving customer experience.
If it’s a particularly early-stage business still searching for product fit, then experience working closely with the Product Team should be prioritised.
Also, the Interaction with Sales as eyes and ears provides rich insights on what problems they are trying to solve with customers, pain points, and why they buy from your brand.
Customer Support can feed-back common problems that occur, that all help to build towards an amazing customer experience.
Your leader with early-stage experience will likely have the battle scars to know how best to collaborate, what levers to pull, and when.
4. Hire for your company’s anticipated pace and place of growth.
Remote or hybrid working is now the norm for many, and has thrown up a new set of challenges for leaders.
Understanding your growth plan, expected hiring numbers and locations will mitigate risk if your leader has dealt with similar management dynamics.
The ability to onboard new team members and foster a great team environment when working remotely is a relatively new skill for many. However, if you find a leader with experience in running multi-geographical teams, they will likely understand what it takes. You’ll just need to assess if they were great at it!
The anticipated pace of growth and likely team numbers should also be considered. If you’re expecting to grow quickly to a team of 20 with an additional management layer, this is a very different challenge to managing 5+ hires directly. With the former, you’ll need to assess whether someone can build and up-skill a middle management team and provide ongoing support and coaching that drives exceptional performance through the team.
5. Be sure it’s a VP of Customer Success you need.
It’s common to get a request from a client to help with a VP, Customer Success, when in fact what they need is a Head of or Director-level candidate to get the CS engine going. The VP title can be offered up too easily in my opinion.
If there is likely to be a considerable amount of IC work and direct client management as the first CS hire, I’d pay particular attention to this, as you’ll run the risk of recruiting at the wrong level and finding a candidate who is a strategic operator and too removed from the day-to-day of running a book of business.
Many VPs will be happy to run clients for a period whilst building out a team; however, if plans change or the pace of hiring unexpectedly slows, you run the risk of having a CS leader who is too senior for what you need.
You can’t predict every eventually.
I would suggest giving considerable thought to hiring a candidate who is stepping up and ready to take on the challenge vs. a proven VP.
These are a few of the many nuances of getting your first CS leadership hiring right. There are many more!
You must scope the role correctly and settle on the right level of compensation vs. market rate before you begin your hiring process. This will most likely include some level of Equity if you’re at an early stage. You’ll also need to create a compelling role description to make sure you stand out in a competitive market.
If you would like to discuss how to set yourself up to hire a CS leader, I would welcome the opportunity to connect. Reach out to me at: firstname.lastname@example.org.
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