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Does the advice to always say no to sponsored features would also apply to a SaaS startup selling to mid-market (ACV 20k to 50k+) and has relatively few clients?
No. This is not wise advice, it is bad advice in many cases. As long as the deal size is big enough. At least, in the earlier days.
If a potential deal, is > $20k-$50k-$100k+ in the early days, you should consider one-off features if:
- the paid feature would also benefit other similar customers, now or in the future;
- the feature is or should be on your roadmap for the next 24–30 months or so; and
- your gut and experience as CEO tells you it’s a good, high-value feature that adds to the value of the company and worth building.
If all 3 criteria are met and a customer is willing to pay up to push out a feature early, I would suggest at least strongly considering it.
Because in that case, it’s no longer a custom feature. Instead, it’s getting paid to learn about the future of your company. Early.
Having said that, do NOT build an “early”/”custom” feature if:
- The customer won’t pay up. It’s not important enough for them, or just as importantly, you, if they won’t.
- If the customer won’t be one of your largest customers. It is too distracting otherwise.
- You don’t think other similar customers will also pay up for the feature down the road.
- Your gut says it is just too distracting. Any “one off” feature is a distraction. But your job as CEO is to know when it crosses the line.
A bit more here: One Simple Rule on When to Build a “Custom” Feature | SaaStr
Having said all this, certainly some disagree. A great deep dive here with Loren Padelford, ex-head of Shopify Plus, their more enterprise offering:
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