It's not all about bottoms-up

This post was originally published on August 23, 2021 for the Angular Ventures newsletter. Subscribe here to receive all new Angular blog posts, data reports, and newsletters directly to your inbox.

For the past few years, almost every founder I met would pitch their business as “product-led,” whether or not bottoms-up adoption made sense for their product or target market.

I don’t blame the founders for this, mind you. They were responding to the market. Public markets loved a bottoms-up story. And investors were pouring dollars into product-led darlings like Figma, Airtable, Notion, countless open source projects, and many others.

The presumed implication of all this was that bottoms-up growth was the only “fundable” business model in startup land. Of course, the reality was much different. Airtable had enterprise sales early in the game, as did Figma. We may not have talked about it. But the ability to marry the two models was critical to our growth and our “fundability.”

Mercifully, two trends from the past year make me think that we may finally be past this mistaken belief that bottoms-up is the only “fundable” business model in town.

First, bottoms-up and top-down are no longer binary. In fact, the layering of top-down over bottoms-up is becoming the de facto playbook. I’ve lost count of the number of “product-led” companies that had stagnated, but bit the bullet, built an enterprise sales organization, and have since found their second wind. (By the way, my take: by publicly eschewing the need for sales reps, Atlassian and Slack really messed with the heads of a generation of entrepreneurs.)

And over the past 18 months or so, an explosion of so-called “product-led sales” companies have been founded to help PLG companies do just this. These products generally fit into two categories: PLG CRMs (Pocus, Endgame, Calixa) and lead/PQL scoring platforms (too many to count). But from my conversations, even horizontal products like internal tool builders Retool, Budibase and Superblocks, predictive analytics platforms like Forwrd, and messaging platforms like Intercom are being pulled into the “product-led sales” game, powering homegrown product-qualified lead systems and upsell campaigns.

Second, direct sales is sexy again. Wiz announced last week that they’d reached $100M ARR just 18 months after launch, making them the fastest growing software company of all time. Yes, faster than Slack. Faster than Twilio. Faster than all their product-led compatriots. Wiz is a prime example (and a good reminder to us all) of how enterprise sales, when executed to perfection, can lead to explosive growth.

So I’m going to call it. We’re no longer living in a world where bottoms-up growth is the only “fundable” go-to-market strategy. Let’s hope investors (and public markets) respond to these trends in kind.

Of course, Angular has been investing in businesses with complex, top-down sales motions since the very beginning. Because what’s important isn’t that you execute on any one particular go-to-market strategy, but that you find go-to-market-product fit. And we don’t care whether it’s top-down, bottoms-up or a flavor of the two (maybe even the PLG mullet!), as long as you’ve solved a problem that customers are willing to pay for.