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Ken Ross recently wrote on the Expert CEO blog about the future of
Software as a Service in today’s economy. Although he discusses software in particular, I think his arguments
apply to any company that needs to grow without using significant
amount of capital.

Historically, SaaS companies needed a significant amount of
funding to get to cash flow breakeven. This was because it takes time for the recurring
revenues to build up enough to cover the fixed and semi-fixed costs of
development, marketing and sales. For example, Ken points out that both salesforce.com
and Netsuite took over $100M in venture capital before going public.

Today, however, those types of valuations and funding levels
are not available, and companies need to find ways to grow their business
without using up as much capital. Ken gives a few suggestions for accomplishing
this goal, including building up services revenue and getting payments up front
where possible.

Perhaps mostly important, Ken writes that capital-efficient growth
can only come from streamlined customer acquisition processes that takes
advantage of the latest internet-era tools, such as salesforce.com; WebEx, GoToMeeting,
or ReadyTalk; and Marketo. Together, tools like these create an ecosystem for capital-efficient
growth: CRM to manage accounts, contacts, and opportunities; online meetings to
improve productivity and reduce travel cost; and lead
management to create a steady stream of qualified sales leads and to help the
sales team prioritize their time onto the best leads and opportunities. The
result of this infrastructure is a streamlined revenue cycle

that can drive 40% better sales effectiveness (or more), allowing each sales rep
to carry higher quota and to drive more revenue at the same fixed cost.

Manage your complexity

At Marketo, we use these tools to drive our own high-volume revenue
cycle, so I know it works.

However, one trap that companies run into is investing in marketing
automation that is not as fast, nimble or flexible as tools like salesforce.com
or WebEx. Even if delivered over the web, these older marketing automation
tools are still from the old era of expensive and rigid enterprise software. As
a result, they tend to force you to do things “The Hard Way”.

To truly accomplish streamlined customer acquisition, your
marketing automation tool needs to let you work “The Easy Way”, e.g.:

• Up and running fast, without significant costs for integration to CRM
• Easy to learn and use without needing to hire specialists or to pay for training courses
• Flexibile to let you adapt marketing programs to changing market conditions

At Marketo, we’ve recently published The Big Easy
Guidebook to Marketing Automation to help our prospects understand some of
the differences between “The Hard Way” and “The Easy Way”. Enjoy!

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About the Author: Jon has over 11 years of experience helping marketers with innovative technology solutions. He is current VP Marketing and co-founder of Marketo, a provider of easy to use on-demand marketing automation solutions that help B2B marketers drive and track revenue. Before co-founding Marketo, Jon was a vice president at Epiphany, where since 1999 he led overall product strategy and direction for Epiphany's industry leading marketing automation applications. He has also worked as a CRM strategist at Exchange Partners and as a strategic consultant for Gemini Consulting. Jon graduated Magna Cum Laude in Physics from Harvard College and has an MBA from Stanford Graduate School of Business.