Seasoned VPs Cost 10x a Stretch VP Now. Is It Worth It? - The Entrepreneurial Way with A.I.


Saturday, October 1, 2022

Seasoned VPs Cost 10x a Stretch VP Now. Is It Worth It?


So That VP That Has Done it Before always cost more than the stretch VP.  They ask for more salary, and a bigger team.  As they should.

But in the past few years, the gap has grown and grown.  Recently I talked with a founder who had hired a seasoned VP of Marketing at $3m that had an 8 person content marketing team.  Not an 8 person team at $3m ARR, but just 8 on content alone!

Now of course some of this is a function of the boom times of late 2020 to early 2022, when lucky started were flooded with capital.

But there’s a larger point — top VPs are getting tired, they’ve done it before, and they don’t want to do it all again themselves.  This has always been true, but 15+ years into this SaaS 2.0 wave, the market is now flooded with these amazing candidates.  VPs of Marketing, Success, Product, Sales and more that really have done it.

Those Prove VPs, even when they join an early-stage startup, all seem to need a team of at least 8-10 folks to start, though.  Even the ones not quite that proven.  They often aren’t willing to run a campaign, or carry a quota, or even talk to customers themselves.  They’re done with that.  I see so many VPs of Sales and Customer Success who don’t really want to talk to customers themselves anymore.  Not really.  They’ve moved on to team building and process.

Again, while not new, it’s spread.  Almost everyone who has been a VP somewhere, even for just a week at a tiny startup, now seems to need a team of 10 on Day 1 just to get anything done.  They’ll insist on it, in fact.

The bottom line is, right or wrong, most of you can’t afford that until you are at at least $20m ARR or so.  Not anymore.

So you’ll have to go with a Stretch VP for most roles at least until $10m ARR in many cases.  Someone at a Director (or similar) role right now.   That has its own risks.  They often don’t know how to build a team at all.  And they may not have owned as much as they claim they do.  But still, it’s the risk you probably have to take.

Dear SaaStr: What Differentiates a “Real” VP?

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Jason Lemkin, Khareem Sudlow