This has a huge impact on unit economics and begins to explain why winning companies place such a large focus on upsells as they mature. The bigger your customer base, the bigger the opportunity to move the needle through upsells.
Upsells aren’t always easy, and depending on the dynamics of your business model they may not even seem like an option. I believe the average company focuses so much on growth through new accounts because that path seems larger, more obvious, and, frankly, easier. But, as we all know, oftentimes the hard thing to do and the right thing to do are one in the same.
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Because of the losses in the early days, which get bigger the more successful the company is at acquiring customers, it is much harder for management and investors to figure out whether a SaaS business is financially viable.