How To Create a Successful Scorecard For Your SaaS Startup | Dan Martell

What was the most impactful thing you ever deployed to your business? In this video, I want to talk about creating a killer scorecard for you to hold your team accountable and crushing goals.

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“How’s your company doing?”

It’s a simple question.

Yet one that freezes so many SaaS founders in their tracks.

Why? They have no freakin’ clue how to answer it.

Do you mean churn?
Do you mean new leads?
Do you mean expansion revenue?

Without a clear scorecard, you don’t know what game you’re playing -- and if you don’t know the game you’re playing, not only is it impossible to “win”, but you’ll burn out trying to play every game all at once.

Before I had a clear scorecard at Spheric Technologies, we were up to 16 employees and a million plus in revenue -- yet I was a total wreck.

I was accountable for EVERYONE -- double checking the most basic things like invoicing at 2 am… on top of my core role as CEO.

And it was all because I failed to implement a scorecard system, and delegate ownership to the right team members.

Simply put, unless you implement a Precision Scorecard™ in your company (and assign ownership to the right team members)... your growth will be severely stunted and you’ll be flirting nonstop with burnout.

In this week’s video, I give you the simplest (yet most powerful) scorecard that you can print out and implement as soon as your next team meeting.

At a high level, here are the 5 key ingredients of a killer scorecard:

1. Funnel Metrics
2. Weekly Measurement
3. Net New Numbers
4. Targets and Actuals
5. Assign Ownership

If personal (or team) motivation has ever been an issue in your company, you’ll want to pay special attention to implementing #3 on the list.

By tracking net new numbers, you literally “engineer” motivation into your scorecard, and defend against complacency.

It’s a small step (literally a few clicks on a spreadsheet) that can make a massive impact over the weeks and months.

Check out the full episode here, and let me know in the comments what changes to your scorecard you plan to make in time for your next weekly meeting.

Dan “The Mentor Whisperer” Martell

Don't forget to share this entrepreneurial advice with your friends, so they can learn too: https://youtu.be/tNHM97e43lY

=====================
ABOUT DAN MARTELL
=====================

“You can only keep what you give away.” That’s the mantra that’s shaped Dan Martell from a struggling 20-something business owner in the Canadian Maritimes (which is waaay out east) to a successful startup founder who’s raised more than $3 million in venture funding and exited not one... not two... but three tech businesses: Clarity.fm, Spheric and Flowtown.

You can only keep what you give away. That philosophy has led Dan to invest in 33+ early stage startups such as Udemy, Intercom, Unbounce and Foodspotting. It’s also helped him shape the future of Hootsuite as an advisor to the social media tour de force.

An activator, a tech geek, an adrenaline junkie and, yes, a romantic (ask his wife Renee), Dan has recently turned his attention to teaching startups a fundamental, little-discussed lesson that directly impacts their growth: how to scale. You’ll find not only incredible insights in every moment of every talk Dan gives - but also highly actionable takeaways that will propel your business forward. Because Dan gives freely of all that he knows. After all, you can only keep what you give away.

Get free training videos, invites to private events, and cutting edge business strategies:
http://bit.ly/2wJAKEJ

- What's up?
Dan Martell here.

Serial entrepreneur, investor
and creator of SaaS Academy and

in this video I want to
talk about creating a killer

scorecard for you to
hold your team accountable

and crushing goals.
It's way easier than you think.

This is going to be the most
impactful thing you've ever

deployed to your business.

It's gonna give you clarity.

It's gonna feel awesome and then
be sure to stay to the end where

I share my Weekly
Sync strategy, a download,

a framework, process,
a checklist for you to run your

weekly meetings to keep
everybody on the same page.

And what's cool is in
there is the scorecard that

I'm gonna teach you today.

So be sure to stay to the end
and I'm gonna tell you how to

get a copy of that.

(upbeat music)

So when I was growing my
company Spheric we were about

16 employees, almost a
couple million in revenue and

I realized that I was running
this company ass backwards.

I mean the truth was that
everybody reported to me which

meant that their to-do
list was my to-do list.

I spent most of my time
trying to grow the business.

Hiring people,
closing new deals,

on boarding, training people
and at the same time trying to

ensure that everybody's work was
done at a quality level to not

embarrass me as the owner.

I remember waking up in the
middle of the night trying to

remember did I ever send that
invoice or did that person ever

pay me or did I ever get that
employment contract signed

and I just felt
ridiculously overwhelmed.

I mean the truth was I had to
imagine at that point other

companies at scale did not
run their business that way.

Like it was very ad hoc
reactive to the situation

and I did like most
challenges that came up in

my life is I turned to books
and I started reading things

like The Four Disciplines
of Execution

and Balanced Scorecards
and many other

incredible business
leaders in their strategies.

And what I came up with was
what I believe to be the most

simplified scorecarding
system for companies at scale.

There's five core principles
that I want to share with you

that are present in this
scorecard format that will help

you get clear,
hold people accountable,

and honestly build momentum
and growth in your business.

Number one, funnel metrics.

If you think about the
things you're gonna measure,

okay, this could be everything
from website visitors to contact

form completions to sales calls
to eventually deals closed to

customer satisfaction to all
kind of the different numbers

that you'd want to
know about your business.

Think about it this way.

If I went away on a desert
island and I could only get a

one page report
about my business's health,

what would I want
to see on that report?

Well, the way I think
about that is I look

at the funnel of numbers.

'Cause it's always, you know if
you think about it like top of

funnel is kind of the
activity like social marketing,

inbound marketing,
traffic to your website.

You know maybe events that
you attend if you're a speaker,

whatever it is.

There's stuff you do to
get awareness in the market.

Then there's the conversion tool
or the sales strategy that you

just take from that awareness or
opportunities that show up and

convert them into customers.

'Cause that's kind of like
another step in the funnel.

Then after that there's well,
I got the contract then I got to

do the work and how
happy is the customer

and monitoring that process.

And then finally, you
know at the end of it,

how much revenue did I generate?

How much did it cost me to
generate that revenue and

did I make any profit?

So if you think about that
it's the bottom of the funnel.

Most entrepreneurs when I ask
them if they have a scorecard

and they say yes and I say,
"Show me the numbers,"

it's all over the place.

There's like 50, either there's
like two or there's 50 and

they're not in any
specific order so the big idea,

number one is funnel
metrics meaning lay out

your metrics in a spreadsheet.

So always put the numbers on
the left side and then the date

ranges as columns so that you
can kind of see how the activity

at the top slowly impacts the
middle and at the bottom and

are you making any money?

So those are the funnel metrics.

It's different for every
business but at a high level

just want you to order them in
that strategy so you can get

clarity of how they
all kind of roll down to

the bottom of profit.

Number two, weekly measurement.

Every week we sit down and we
review our scorecard as a team.

That means that not matter
what datapoint we're measuring,

we want to get the
current number for

that week and that date.

So we want to see it,
we plot it on the spreadsheet.

This is not fancy
scorecards on a TV screen.

This is literally a spreadsheet
and we update it and that way we

have a cadence of every week
of measuring our progress.

Too often entrepreneurs wait.
I mean most of them, 98%,

they wait to the
end of the year,

They get a report from
their accountant and

they decide to go have a drink.

They're either gonna drink
'cause they had an incredible

year or they're gonna drink
because they had a crappy year.

But what I want you
to do is get in the habit

of taking 52 shots on goal.

That means that every week for
every data point that you're

measuring your funnel metrics,

you're looking if
you made progress.

And what's great is if
you have crazy aspirations,

and I don't know how
you're gonna hit your numbers.

If you want to, you know,
5X, 10X your growth in

the next 12 months, you need
to measure weekly to know

if you're on track.

And that to me is a discipline.

As a team we sit down and we
review it so we can make sure we

can realign in strategies
or tactics that may not be

supporting the outcomes
that we want to achieve.

So weekly measurement is a must.

Number three,
net new numbers or ratios.

Essentially what it is is the
numbers you measure on a weekly

basis isn't the total volume
or the cumulative number.

It's the net new created
in that seven-day window.

Meaning how many people visited
our site in the last seven days?

How many new leads did we add to

our marketing funnel
in the last seven days?

How many deals have we
close in the last seven days?

How much revenue did we
invoice in the last seven days?

It's always the net new number
and it's not a total because

what happens is it's kind of the
psychological effect where we

have a thermostat in our mind
and if we look at numbers and

they're going up,
as they would every week,

you should be doing something,
if they feel good we actually

slow down our focus
and aggressiveness

on fixing the number.

But, check this out, if you're
a sales guy and you're just

looking at total sales for the
quarter then at a certain level

you're gonna feel
pretty good at yourself.

But if you actually looked at
the effort or the outcome the

last seven days and
it's a big goose egg,

a doughnut, a zero,
you're gonna go,

"Well shit, I did a bunch of
stuff last week and it didn't

"show up in anything
for my sales number."

So as a team you don't want to
measure the total number for a

month or a quarter or a year,
you want to track the net new

activity or you want to create a
ratio which might take a couple

other data points and looked
at that ratio as a data point

and how does
that look over time.

So that is a huge opportunity
to clear up the numbers

and focus on the right things.

Is only track the net new
outcomes of the activity

in the previous seven
days in your scorecard.

Number four,
targets and actuals.

If you're tracking every week
and you don't have a target for

the month then you're missing
a incredible opportunity

to keep the team accountable.

Look, if you do this,
if you negotiated,

"Hey, what are we gonna do in
the next quarter," with your

team and they set the targets
and then every month you track

the target for the
month in the actual.

So this is the number you said.

Every metric,
every funnel metric,

lead gen, website traffic,
sales volume,

revenue, profitability,
net promoter score,

I mean you can Google the
metrics that you want to monitor

for your business.

But if you have the targets
and then you have the actual,

'kay, which is how
are we doing average?

It might be an average,
it might be a total,

whatever for the month then you
know if you're two weeks into

the month and you only have two
weeks left that you should be at

50% of that number so you can
see the difference side by side.

It's like if the number's
supposed to be 100 for the month

and you're at 20 and you're
halfway through the month,

there's no way unless you change
something and you focus on it

and you invest in it and you sit
down as a CEO with your team and

say, "Hey, this is not on track.

"What are we
going to do to fix it?"

Because here's
the big idea, 'kay?

If you miss a number on one week
and you still want to hit your

target for the month, you
gotta make it up the next week.

If you miss it for the month,

you gotta make
it up the next month.

Most entrepreneurs set such
aggressive goals that if they

start to slip there's no
way they're gonna catch up.

So you can not take your eye off
of the target or the actual for

that period and I'm
recommending weekly.

Number five, assign
ownership to the funnel metrics.

The reason why we want
to do this is if you're the CEO

like I was when
I was building Spheric

and you feel
accountable for everything.

Nobody cares about my business
and I always have to check on

people and all this stuff, it's
'cause you haven't given them

the accountability to update
the number and own the numbers.

You might've said,
"Hey, I want you to do this."

And they're like, "That's great,
I know what you want but I may

"not be able to do that." Right?

'Cause a lot of people are like,
"Well how do I compensate?"

Or, "How do I encourage people
in sales or customer success

"when there's no quota
or commission structure?"

Look, humans are simple.

We want to know
how the game is played,

how do we score a goal and
how are we doing in that game?

So if you give them the
score and you monitor their

performance,
they will self-adjust.

If they said, "Look, I'm gonna
do 100 sales this month," and

halfway through the
month they're at 30,

they will fix their activities
to adjust and make sure they

make up the missing
numbers to hit the

numbers at the end the month.

'Cause here's the cool part,
is everybody on the team knows.

And what I do is I assign
those numbers to the person

responsible for updating it.

So before our weekly meeting,
our Weekly Sync which I'll share

with you in a second,
everybody goes and updates,

grabs the numbers from these
different systems and updates

the spreadsheet so
that they know their number.

So most people don't even know
their numbers and then they're

accountable to it 'cause they
updated it and then in team

Weekly Sync you review them
as a group so you create this

beautiful thing called
positive peer pressure.

Where the peers,
their leadership team,

their other folks on their team
are holding them accountable to

their numbers because they
reported and if they losing or

missing or slipping then the
rest of the team will be like,

"Hey, that's not cool because
you not hitting your marketing

"targets is affecting
my sales opportunities

"and we need to adjust that."

So make sure you assign
ownership of the metrics to

individuals that should own
those within your company and

ideally per category,
not individual numbers.

Somebody should
own customer success.

Somebody should own sales.

Somebody should own marketing.

So quick recap on
creating a killer scorecard.

Number one, funnel metrics.

Make sure you list the
metrics on the left side of your

spreadsheet
sorted by top of funnel,

mid funnel, bottom of the funnel

and then operational
or finance numbers.

Number two, weekly measurement.

Every week your team
should update those numbers.

Three, net new or ratios.

Don't put totals
or cumulative numbers.

Put the new
activity for that week.

Four, targets and actuals.

Know where you're going, how are
we measuring on our way there on

a monthly and quarterly
basis and adjust accordingly.

And five, assign ownership.

Everybody on your team that's
responsible for a project or an

outcome should own
the number associated to it

and that is how you keep
accountability, clarity,

and a high
performing team executing.

So as I mentioned at
the beginning of this video,

I want to share with you the
Weekly Sync agenda structure

that I use to run my
team meetings every week.

I mean it is the most
comprehensive focused

and high output team structure.

Every week I have
things like customer headlines.

We talk about issues,
we talk about our scorecard.

Hence why I wanted to
share this framework with you.

We talk about the big rocks that
we need to execute but we do it

in a very structured
way that gets us in and out.

Everybody synced up
and executing for the week.

So you can click the link below
to download your copy today and

if you liked this video, I'd
encourage you to click the like

button, subscribe to my channel
and be sure to share this video

with a friend and
also leave a comment.

Let me know out of
these strategies I mentioned,

what one thing out of the
scorecard strategy were you not

doing that you're gonna change
in the way you measure today.

I'd love to hear
below in the comments.

As per usual, I want to
challenge you to live a bigger

life and a bigger business
and I'll see you next Monday.

Perfect, cool.