By Caroline Brand and Chris Hubbell | September 23, 2021
SaaS company with an IPO in sight? The right marketing head can get you there.
Strong leadership is key at every stage of a company’s growth – but having the right leader becomes imperative as your company prepares to enter the public markets. Knowing which operational requirements to optimize for when considering a new leader can be challenging. Which qualifications and prior career experiences should you prioritize during the hiring process? In search of a data-driven answer to this question, ICONIQ Growth studied how dozens of public software companies built their executive teams between founding and IPO. We are excited to share insights from our first analysis, which focuses on heads of marketing.
We studied 49 venture-funded SaaS companies that IPO’d between 2016-2020. Using LinkedIn, public filings, press releases, and internet archives, we identified every head of marketing (or equivalent position) at each company between founding and IPO. We collected over 60 data points on each marketing leader, including both explicit information (such as their title and prior work experience) and inferred information (such as their area of marketing expertise). This article will focus specifically on the cohort of heads of marketing who were in this leadership role at the time of IPO.
Companies included in this analysis:
While there are myriad important qualitative factors to assess when evaluating potential executive hires, our analysis focuses solely on leaders’ prior career experiences and operational backgrounds.
The time to think about hiring the marketing leader who will guide your company through IPO is at least two years prior to your desired public offering timeframe.
We found that companies hired, on average, three heads of marketing between founding and IPO. While some organizations hired the marketing leader who took them through IPO over a decade before that milestone, the average across all companies was 28 months in advance of their public market debut. In terms of scale instead of absolute time, 40% of companies hired their marketing leader for IPO after reaching ~$100M in annual recurring revenue (ARR) while an additional 32% hired this leader after reaching $50M ARR but before reaching $100M ARR.
Once you decide who to hire, what’s the right title to offer? At the time of IPO, marketing leaders at 78% of companies held the title “chief marketing officer”. Other companies opted for SVP/EVP-level titles (9%) or VP-level titles (11%), whereas only one company used the title “head of marketing”.
Prior head of marketing experience is not necessarily critical, but those without it typically were promoted internally or spent several years honing their craft at a large public tech company.
While prior experience running a marketing function may seem like a “must-have” for the marketing leader who will take your company through IPO, almost half (46%) of the companies we studied hired a “rookie” head of marketing.
However, this is not to say that the first-time heads of marketing were unqualified. In fact, we observed two common paths to landing this leadership role for the first time, each with significant operational merits. Those who had not run a marketing function before typically came from one of two backgrounds:
- Company veterans: In some cases, deep knowledge of the organization can substitute for prior experience running a marketing function. What these marketers lacked in prior head of marketing experience they made up for with experience garnered within the walls of the company that they later led through IPO. For example, one company in our dataset was shepherded through their IPO by a marketing leader who had not run a marketing function previously (i.e., before joining this organization). However, they led marketing at this organization for more than six years before the IPO, first as a director and then as a VP, and they remain the chief marketing officer today.
- Industry veterans: In other cases, companies hired externally for their head of marketing, choosing someone who had not held the role before. However, in lieu of experience heading the marketing function, these leaders were typically at a VP+ level with a decade-long tenure at a large public technology company like Salesforce or Microsoft. Their tenure at these organizations ranged from six to 16 years with an average of 11 years.
Of the leaders who had run a marketing function before, more than two-thirds had done so at either a public company or a late-stage private company that had raised more than $100M in venture funding.
Together, those with prior head of marketing experience, “company veterans,” and “industry veterans” accounted for over 85% of marketing leaders at the time of IPO at the companies we studied.
Prior IPO experience is not a prerequisite for success.
In addition to prior head of marketing experience, we often hear CEOs and founders express a preference for marketing leadership candidates with prior IPO experience. At the 49 companies we analyzed, we were surprised to find that only 15% of marketing leaders at the time of IPO had previously taken another company public as a head of marketing. As discussed at our recent ICONIQ Ideas Growth event on “CMOs Talk IPOs,” Snowflake was led through IPO by a CMO who had previously guided two separate organizations through their IPOs. However, Snowflake is unique in this regard, as more than 80% of organizations in this study did not have a chief marketer with this career milestone on their resume.
Consider the specific type of marketing skill set each candidate possesses. Product marketing was the most common background among the leaders in our study.
While evaluating candidates’ past leadership experience is important, we also recommend thinking about whether their area of expertise within marketing is the right one for your organization. Generally speaking, there are three primary “sub-functions” within marketing:
- Corporate marketing: Positions the company, controls the brand narrative and appeals to customers. Communications, PR, content marketing, advertising, and brand strategy fall under this purview.
- Product marketing: Brings products to market by refining the competitive positioning and messaging, launching the product, and driving product usage by ensuring customers understand how the product can benefit them.
- Revenue marketing: Finds, converts, and nurtures customers through data-driven strategies and programs that generate revenue for the business. This primarily includes demand generation, although we’ve bucketed partner marketing and field marketing in this group as well.
In order to make our analysis of marketing backgrounds as actionable and relevant as possible, we cut this data by company sales motion. As a refresher, companies with a bottom-up go-to-market (GTM) motion drive widespread adoption across multiple employees at an organization and often sell their products without an executive sponsor. Examples include Asana, Datadog, and DocuSign. Companies with a top-down GTM motion rely on an executive sponsor to champion a larger deal, after which employees begin using the product. Examples of this include CrowdStrike, Coupa, and Medallia. We categorized each company in our dataset by their primary GTM motion: bottom-up or top-down.
Companies with a bottom-up GTM motion were taken public by marketing leaders with a predominantly product marketing background 46% of the time. Revenue marketing was the second most-common background (42% of marketers at IPO), followed by corporate marketing (8% of marketers), and non-marketers and/or companies with no marketer at IPO (4%). The proportion of leaders with a product marketing background was nearly the same at top-down companies (48%), though we saw an even split between revenue and corporate marketers (17% each); non-marketers and/or companies with no marketer at IPO comprised the remaining 18%.
Prior go-to-market motion is another key factor to assess, while prior experience within the same sector as your company is less salient.
We also categorized each marketing leader as a top-down or bottom-up marketer, based on the types of organizations at which they had previously spent time. Additionally, some marketers were labeled as “consumer” if they did not have an enterprise background. We found that top-down GTM companies hired top-down marketers to lead them through IPO 67% of the time. Bottom-up GTM companies hired top-down marketers to lead them through IPO 52% of the time.
More than half of the top-down marketing leaders at bottom-up GTM companies joined after the company reached ~$100M ARR. We hypothesize that because bottom-up companies often need to hybridize their sales motion in preparation for IPO, these organizations may have hired a top-down marketer to guide their transition to larger enterprise lands.
One factor that appeared to matter less was sector background. Our research showed that only 35% of heads of marketing came from roles in the same sector as the company they guided through IPO. 65% of marketing leaders primarily spent time in a different sector prior to joining the company they led through IPO. While we would not discourage hiring from within the same sector as your company, historically there did not appear to be a discernible trend around companies optimizing for this trait.
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ICONIQ Growth endeavors to help founders and CEOs make data-driven executive hiring decisions. Beginning with the marketing function, we are studying quantifiable traits and qualifications shared by marketing leaders hired at now-public companies between founding and IPO. (Not yet ready to IPO? Reach out to us for insights specific to pre-IPO growth stages). We hope this series is helpful to you as you build out your executive leadership team and evolve your hiring strategy.
 We use the term “head of marketing” as a generic term to refer to the head of the marketing function, regardless of their actual title.
 While this article will focus on Heads of Marketing at the time of IPO, we also created a dataset with each company’s entire marketing leadership history, from inception to IPO. Additionally, we created a proprietary model to approximate when each company reached certain key business milestones (e.g., $20M ARR, $50M ARR…) to help contextualize marketing leadership trends by company growth stage. If you’d like access to this information on pre-IPO marketing leaders across various stages of company growth, please reach out to us.
 These figures are largely based on approximations. Many companies do not make ARR figures publicly available, and thus in many cases we relied on proxy metrics (e.g., headcount) to estimate when a given company may have reached a certain ARR scale.
 While there are multiple sub-functions within the marketing discipline, we will be referring to these three backgrounds throughout this section for simplicity. We believe the core marketing skill sets can be captured within one of these three groups. Several leaders in this analysis had experience in multiple marketing sub functions, either directly or as a leader who oversaw multiple domains. Each person is categorized according to their dominant/primary background.
 Each leader was labeled according to their dominant/primary sector background, as defined as the sector in which they spent the greatest number of years in a marketing leadership position prior to joining the organizations in our dataset. Thus, because we looked only at their “primary” sector, it is possible that these leaders spent some amount of time in other sectors as well, including the same sector as the company they guided through IPO. This portion of the analysis looks only at whether each leader’s primary sector background matched up with the company they took through IPO.