The Ultimate Scaling Playbook That Helped CutShort Transition into the $1M ARR Club

Published on June 15th, 2022

7 min read


It is tough to start a business.

But what’s more challenging is to scale it beyond a specific benchmark.

The obstacles you face in the third year of your startup are different from those you face in your first year.

To throw some light on the growth issues startups face we brought in the co-founder of the famous AI recruitment platform. In this podcast, we are in conversation with Nikunj Verma, the co-founder of CutShort, a marketplace for hiring high-competence tech talent. This platform has seen exponential growth over the past couple of years as it has played a significant role in boosting the hiring process making it “the new HR favorite”.

 We connected with him to understand his playbook for dealing with obstacles they faced while scaling CutShort into a $1M ARR business.

He also shared his insights on their plan to reach the next significant milestone, which is to scale CutShort’s revenue from $1M to $10M in ARR.

Listen to the complete conversation here

Here are the top 5 highlights from our conversation with Nikunj:

  • Inception-story of Cut short
  • Strategy to get first 50k signups
  • Three things are essential to scale your SaaS to $1M ARR
  • The open leadership management structure
  • Three levels of thinking in business

Inception Story of CutShort

When Nikunj came back to India from Boston, he wanted to start his own business. He was already a seasoned product manager and had significant experience in marketing as well.

So one day, he just sat down and noted where the market is moving and the major pain points of the software industry.

He realized that hiring was a challenge for both sides of the market – for the engineers looking for jobs and the companies that want to hire them. With this insight, he talked to several industries and laid down the foundation of CutShort.

Strategy to get first 50k signups

As you know, CutShort is a marketplace that connects job-seekers and companies looking to hire talent. So in the initial days, they needed a substantial amount of job applicants to attract businesses to their platform.

In our conversation, Nikunj highlighted the key tactics they used to get the first 50k job-seekers to sign up on their platform.

Watch the podcast here:

They used LinkedIn outreach quite actively and hosted many recruitment events. The latter turned out to be the most significant growth driver.

The three most important things to get right

Scaling a startup from scratch to a million dollars ARR is quite a journey. It’s a very complex journey, and it is almost impossible to encapsulate all of it in the three pieces of advice. However, if you get these things right, the chances of your startup’s success increase by triple folds.

1. Choose the right market

If you want to create a successful startup, you need to pick your market carefully. The best businesses are the ones that fulfill a demand where the existing solutions fail to satisfy the customers. So choose a market that is: 

  1. Large; and 
  2. Has low NPS (Net Promoter Score)

The large market size indicates sufficient demand, and the business is scalable, while low NPS means that the customers are not satisfied with the existing solutions.

2. Problem-Oriented Approach

As you start to build a product for a market, it’s easy to define your startup by your category. However, the entire point of figuring out your PMF is to be problem-centric and find the right market for your product.

It’s difficult for your clients to buy different products from all the categories. That’s why they keep looking for holistic solutions. Being need-focused helps you become the holistic solution your clients are hunting for.

3. Invest in your brand image

Nobody wants to do business with a company they don’t trust.

Establish yourself as a genuine brand. If you have to sacrifice your revenue for the sake of it, do it without any hesitation.

The Open Management Leadership Structure

When it comes to hierarchies in the internal culture, CutShort is a very unconventional company. They have a very open culture and still don’t have managers in many crucial domains. 

They only have functional leaders working with people and have no authority. It’s a distributed leadership. For instance, their sales leader also handles hiring, onboarding, and metrics.

Their leadership structure is very open, where they value and support generalists in their team.

Three Levels of Thinking in Business

Whenever you make any change in your product or offerings, you can follow three different types of mindsets to take the right action.

To illustrate that, Nikunj gave a perfect example of a hypothetical situation.

Suppose you have to send an email today to customers about a new feature. Now you could write an email saying: 

Level 1 Thinking – This is a new great feature we have launched

Level 2 Thinking – What else I can do on top of it? What customers might be going through? Should we add a customer testimonial who uses this feature to create more awareness or more interest in that? 

Level 3 Thinking – Can this be a referral feature? Can customers, when they see this feature, ask them to share it with a network that might like this idea.

Final Notes

Scaling a SaaS to $1M ARR is a tough grind. But with an experimental approach and customer obsession in the right market, things get a little easy. 

Experimental approach because half of what it takes to scale startups successfully is figuring out the right systems. There are no absolutes in the world of business, especially when it comes to processes. The only way to figure out the right systems is to experiment with them ruthlessly.

Customer obsession because if your customers love your product, they will become your biggest marketing asset. And if you have the right insights into their problems, you will be able to create a product that solves their pain points.

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