The Upstream Test

From: Chris Piper
Former COO and CMO - $165M in managed revenue - Scaled 4 companies to 8 figures

Earlier this year, a prospect emailed one of my clients to say there was no way to book a call. He'd filled out their entire application, gone to the calendar, and found nothing open. That same week, the company was sure its problem was a shortage of leads.

The leads were coming in. They were hitting a wall at the calendar.

You might think this is a simple RevOps oversight, and it is on the surface. I’m not writing to talk about that, it’s something much deeper that I can almost guarantee is happening somewhere in your company, right now.

Most founders who come to me are sure they have a Momentum problem: not enough leads, not enough growth. Dig one layer down and it's usually Structural. Dig another and there's often an Identity problem under that. The symptoms show up at the bottom of the funnel, where you can see them, so that's where the money goes.

There's a line I use with almost every client: you can't fill a leaky bucket by pouring more water in.

Everyone agrees with that until it's their bucket. From the inside, a leak doesn't look like a leak. It looks like you need more water. I call it reading the label from inside the bottle. You can't do it, and neither can anyone who lives in the business every day. It’s why experts hire other outside experts.

If growth has stalled and the plan is to spend your way out, give it an afternoon first. You can run most of this check yourself in four steps, without spending a dollar.

One sentence. "We need more leads," or "Sales isn't closing." Don't defend it and don't fix it yet. You'll check it against Step 4.

Go through your funnel exactly the way a prospect would, on your phone. When I review a client's landing page, that's the first thing I do, because most of the traffic is mobile. At this client it was 80%.

Click the ad, fill out the form, and try to book. Then pull last week's form fills and compare them to the number of people who actually landed on a calendar. If that gap surprises you, you've found something.

Averages hide the problem. A sales team closing 25% on average can be one rep at 70% and another at 5%.

Pull close rate by rep and conversion by channel. Wherever the spread is widest, money is leaking.

This is where the Three Gaps come in . Every growth problem I see traces back to at least one of them. The simplest way I can put it: the Identity Gap gets the foundation wrong, the Structural Gap gets the machine wrong, and the Momentum Gap means the machine isn't moving.

Most of your are trying to scale by doing more mere activities (and pushing hard to stay afloat). Resolving these gaps creates true momentum, and growth.

The Identity Gap is the gap between what you are and how the market sees you. You feel it when you can't say what makes you different without hedging, or when your best clients describe you better than your website does. Ask yourself what those clients say when they refer you, and whether your homepage says the same thing.

The Structural Gap is the gap between the business you're running and one that can scale. You feel it when revenue grows and margin doesn't, and when you're still the highest-paid person in the company doing execution work. If you disappeared for 30 days, what would break first? You start there.

The Momentum Gap is the one everyone thinks they have: the growth you're capable of versus the growth you're getting. Pipeline runs feast or famine, and marketing happens when someone has time. What have you been saying "we just need to execute better" about for more than a quarter?

Start at the top, because Identity sits upstream of everything. The first answer that makes you wince is where the work starts. Then go back to your sentence from Step 1. For most founders, it names a different gap.

Back to the company with the “full” sales calendar.

Leadership wanted costs down and results faster, and the read from sales was that leads had dropped after a rough stretch on Meta. Their head of marketing went and looked anyway. She had every form submission flowing into a sheet, and the leads were still coming in. They just couldn't book.

Sales had been testing call caps in their scheduling software, and the test had blocked the calendar. It said they were full. There were only 27 calls on it.

On a call with her that week, we kept pulling on it. The best closers were capped at five 45-minute calls a day. I ran the math twice because it seemed too low, but it held: under four hours of selling a day from the people who close the most. (I've always run uncapped sales teams. You want to take ten calls a day? I'll send a case of Red Bull to your house.)

Close rates across the team ran from single digits to around 70%. Moving about 170 leads from a 10% closer to a 55% closer was worth a little over $500,000, without another dollar in ads.

That's a Structural Gap that looked like a Momentum Gap, because the symptoms showed up in the pipeline. The fix started with something I told her that afternoon: you can't have a blocked calendar.

They fixed the routing. Leads went to the closers most likely to close them, and the money that had been stuck behind the calendar came in. Revenue and profit both went way up. That quarter, they hit their goal for the first time in a year.

In my engagements, this is where we start. It’s the first two weeks. I don't build or hire anything until I know which gap is upstream. Spending before you've diagnosed is putting the cart before the horse, and it's an expensive cart. A client once described it as “throwing good money at bad, lighting it on fire, then taking the ashes and blowing them into the wind.” She nailed it.

Once you know where the work starts, the next question is how to close one gap in 90 days without trying to fix everything at once.

That's where we'll pick up next time.

If you run a founder-led business doing at least $3M and want a second set of eyes on your upstream test, reply to this email or book a 30-minute call with me. I'll tell you which gap I think is upstream and roughly what it's costing you.

If you know a founder who's about to spend their way out of a problem, forward this along.

—Chris Piper

P.S. If a call feels like too much right now, reply with your Step 1 sentence and your answers to the three questions. I'll tell you whether I think you're looking in the right place.