Salesforce Cuts Back Growth Rate

Jun 02, 2024
Salesforce Cuts Back Growth Rate

Salesforce lowered their revenue growth rate target below 10%.

They shifted their quarterly pipeline coverage from 2x to 3x.

They reduced their anticipated operating margin for 2025.

  • They’re expecting slower growth
  • They’re expecting reduced spend
  • They’re expecting price sensitivity
  • They’re expecting higher CAC

This is the moment we’ve been waiting for.

It’s the first of many dominoes to fall that will inevitably lead to a reassessment of the entire industry’s economics.

40% quota attainment couldn’t sustain itself forever, but first-movers are always BigCo’s.

The problem is, startups can’t navigate these waters the same way Salesforce can.

Startups can’t afford to go from 2x to 3x pipeline coverage.

Which is nearly the same as reducing quota.

That level of spend increase could bankrupt a startup in a year.

But Salesforce can afford it.

Startups can’t lower their growth rates and maintain investor excitement.

But Salesforce can.

Startups can’t do mergers and acquisitions to buy customer growth for pennies on the dollar.

But Salesforce can and will do just that.

These are the reasons it’s important to follow and get ahead of industry trends.

Because once the big whales make their moves, the rest are forced to compete, die, or get swallowed up below prior valuation.

Consolidation starts with financial strain.

That strain gets more challenging when the big players reduce their expectations.

Now everyone’s forced to follow suit.

Just wait until they drop their prices.

Things are about to get interesting.

Don’t fall asleep behind the wheel.

Plan for less.

Expect less.

Retain your people.

It’ll matter more in the long run.

T2D3 growth model is about to come under question.

Is it still feasible to expect triple revenue for 2 years and double revenue for 3 years in these market conditions?

Is it feasible to gamble everything only to make that your number one priority?

Probably not for long.

It’s about to get hyper competitive.

Growth will become more costly for a while.

BigCo’s will set the pace.

Be prepared to follow.

Or get squashed by those who do.

You’ve been warned.

If you need help building and scaling your sales and revenue organization book a coaching session and let's get started.

Happy Selling,

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