First Customers·Jonathan Festejo, Salesbricks

First Customers: Why Selling to Enterprise Almost Killed This SaaS

Introduction and favorite quote on failure

0:00Loading…

Listen on:

Like this episode?

Get real founder strategies for the AI era. Delivered weekly.

Free weekly newsletter · No spam

Jonathan Festejo spent two years building an enterprise product that nobody wanted to buy. Sales cycles dragged to three months, and buyers kept choosing to "do nothing" rather than switch.

Then he pivoted down-market to early-stage founders - and his first customers started closing in five days. In this episode, Jonathan reveals how Salesbricks hit $1M ARR by targeting founders doing $500K-$2M who were hacking Stripe and spreadsheets late at night, and why a simple "Powered By" button became their most effective growth channel.

Jonathan Festejo is the CEO and co-founder of Salesbricks, a deal-closing platform that handles quoting, billing, and subscriptions for SaaS companies.

Before Salesbricks, Jonathan ran RevOps for multiple unicorns. He knew the pain of "Quote-to-Cash" intimately. But when he started his own company, he made a classic mistake: he built for the Enterprise first.

He spent nearly two years over-engineering a robust platform designed to replace Salesforce CPQ. But when he tried to sell it, he hit a wall. Enterprise buyers had 3-month sales cycles, complex approval chains, and often decided to "do nothing" because switching was too risky.

The breakthrough came when he pivoted down-market. He realized that early-stage founders ($500K-$2M ARR) were the ones with the most urgent pain. They were hacking together Stripe and spreadsheets late at night and were desperate for a solution.

Jonathan used these 3 strategies to find his first customers and reach $1M ARR:

Targeted founders who were personally doing billing at night - they felt the pain and could make instant buying decisions
Built a "Powered By Salesbricks" button into every contract sent, turning each transaction into a high-intent lead channel
Leveraged founder-to-founder referrals from his network, converting warm intros into paying customers

By shifting his focus to founders, sales cycles dropped to 5 days. The product roadmap started writing itself based on real user feedback, and Salesbricks hit $1M ARR with over 100 customers.

This episode is part of our First Customers series.

Key Insight

Salesbricks spent nearly two years building for enterprise buyers who had 3-month sales cycles and kept choosing "do nothing." The breakthrough came when Jonathan pivoted to early-stage founders ($500K-$2M ARR) who were hacking Stripe at night - sales cycles dropped from 3 months to 5 days, and the product roadmap started writing itself from customer requests.

Key Ideas

Enterprise buyers with 3-month sales cycles and "do nothing" defaults were the wrong first customers for an early-stage startup
Founders doing $500K-$2M ARR felt the pain personally and could make buying decisions in 5 days with no committee approval
A "Powered By" button on every contract generated 4 clicks per 10 contracts sent, creating high-intent inbound from other founders
First 30 customers came from Jonathan's RevOps network; referrals from those customers became the primary growth channel
Customer feature requests validated the down-market pivot - founders were building the product roadmap, not the internal team

Key Lessons

🏢 Avoid the enterprise trap when finding first customers: Jonathan spent two years building for enterprise buyers who had 3-month sales cycles and kept choosing "do nothing" - early-stage startups need buyers who can say yes in days, not quarters.
🎯 Target buyers who feel the pain personally: Founders doing $500K-$2M ARR were hacking Stripe and spreadsheets at night - they showed up to sales calls with written problem lists and closed in 5 days because no committee stood between them and a decision.
🚀 Build viral loops into your product to find first customers: Salesbricks embedded a "Powered By" button on every contract sent, generating 4 clicks per 10 contracts and creating a steady stream of high-intent inbound leads from other founders.
📉 Watch for "polite interest" as a red flag in enterprise sales: Enterprise champions loved the product but couldn't get finance to approve the switch - Jonathan learned that enthusiasm without decision-making power is a dead end for early-stage startups.
🤝 Your first customers often come from your professional network: Jonathan's first 30 customers were former colleagues and their referrals - people who already understood the problem and trusted him to solve it.
💰 Let your first customers build your roadmap: After pivoting to founders, feature requests started aligning across the customer base - a signal Jonathan never saw with enterprise buyers, proving the ICP shift was right.
🧠 Hire A-players who are self-sufficient, not cheap juniors: Salesbricks hired junior engineers to save money, but the management overhead turned senior engineers into full-time trainers, resulting in negative productivity and a painful round of layoffs.

Watch the Episode

Chapters

00:00Introduction and favorite quote on failure

01:11What Salesbricks does and who it serves

02:27Revenue, customers, and the "Magic Hour"

03:15Origin story - the Halloween DocuSign nightmare

05:30Meeting co-founder John and quitting day jobs

06:51Raising $250K friends-and-family round without a product

09:01Why it took 18 months to build the first product

12:30Overbuilding for enterprise - the wrong first customers

15:35The enterprise trap - 3-month sales cycles and "do nothing"

17:42Pivoting down-market to founders doing $500K-$2M ARR

19:21Signals that founders were the right ICP

21:38How first customers shaped the product roadmap

24:24First 30 customers from the founder Rolodex

25:24Why outbound sales failed for Salesbricks

26:27The "Powered By" viral loop driving inbound leads

28:16Hiring junior engineers - the costly mistake

30:54The A-player hiring philosophy

32:14Lightning round and book recommendation

Episode Q&A

How did Jonathan Festejo get Salesbricks' first 30 customers?

Jonathan leveraged his network of sales leaders from previous RevOps roles at A16Z-backed companies. These contacts became his first customers because they already understood the Quote-to-Cash problem and trusted him to solve it.

Why did Salesbricks fail to close its first customers when targeting enterprise?

Enterprise buyers had 3-month sales cycles, complex approval chains, and consistently chose to "do nothing" because the risk of switching from their existing systems was too high - even when they acknowledged the pain.

How did Salesbricks cut sales cycles from 3 months to 5 days?

By pivoting from enterprise finance teams to early-stage founders ($500K-$2M ARR) who felt the billing pain personally, could make decisions without committees, and were desperate to stop hacking Stripe and spreadsheets at night.

What is Salesbricks' "Powered By" viral loop for acquiring first customers?

Every contract and invoice sent through Salesbricks includes a "Powered By Salesbricks" button. About 4 out of every 10 recipients click it, and because those recipients are founders in a buying mindset, they convert into high-intent inbound leads.

Why did Jonathan Festejo describe outbound sales as "dead" for Salesbricks?

Despite booking 10-15 outbound meetings per week, the conversion rate was extremely low because prospects were contacted at the wrong time and didn't yet feel the pain. Inbound from the "Powered By" loop and founder referrals converted far faster.

How did Salesbricks raise $250K before having a product?

Jonathan's former colleagues - including an early Andreessen Horowitz partner and the founding CRO of Okta - invested based on their personal experience with the Quote-to-Cash problem and their trust in Jonathan from years of working together.

What hiring mistake nearly derailed Salesbricks' growth?

Jonathan hired junior engineers to save costs, expecting three juniors to match one senior's productivity. Instead, senior engineers became full-time managers, overall velocity dropped, and Salesbricks had to let go of the junior hires about 18 months later.

How did Salesbricks know its first customers were the right ICP?

Founders started prepping problem lists before sales calls, feature requests aligned across the customer base, and customers began building the product roadmap themselves - signals Jonathan never saw when selling to enterprise.

What is the "Magic Hour" that drives Salesbricks' transaction volume?

The majority of Salesbricks transactions happen between 8-9 PM, when founders finish their day jobs and tackle back-office work like buying software and closing deals - confirming that founders, not enterprise teams, are the right first customers.

Book Recommendations

Amp It Up

by Frank Slootman

More on First Customers

Nate Baker, Qualia

How to Find Your First Customers by Living in Their Basement

Nate Baker is the co-founder and CEO of Qualia, a software platform for title companies that helps coordinate the complex process of buying a home. Today, Qualia generates over $100 million in ARR with a team of 600 and has raised more than $200 million. In 2015, Nate was 21 years old and decided to build software for the real estate industry. He had no experience in that space. He didn't talk to any customers. He just did some research and decided that was the thing he was going to do. Then he started building. Still without talking to anyone. Nate admits this was a mistake. He and his co-founders got key things wrong about how the business would work. They wasted months building things they eventually threw away. It wasn't until they found their first customer that they started making real progress. Their first customer was Barry Feingold, a state senator in Massachusetts who also ran a real estate law firm. Barry believed in the vision, taught them the industry, made introductions, and helped them understand what actually mattered. The relationship was unconventional: Nate and the first 25 employees rotated through living in Barry's basement. New hires would get a call Sunday night: "Your onboarding is in Andover. You're going to live in Barry's basement for two weeks. He's going to teach you title. You have to tutor his kids in math." But then Barry's existing software vendor found out he was working with Qualia and shut off his access overnight. Nate and his team didn't even have the core features built yet. They had to figure it out fast. It became the most productive month in company history. Barry didn't just become a customer—he introduced Qualia to his competitors. Those network-based relationships became the foundation for the first 10 customers. Nate learned that your first customers must come from your network, not cold outreach. In this episode, you'll learn: 1. How to find your first customers through network-based selling instead of cold outreach 2. The multi-year upfront contract strategy that brings cash forward and locks in commitment 3. Why geographic focus beats national expansion in the early days 4. How to embed yourself with customers to truly understand the problem 5. When to hire your first sales leader and how fast to scale

Richard Hollingsworth, Fyxer

Agency to AI SaaS: Scaling from $1M to $18M ARR in 9 Months

Richard Hollingsworth is the Co-founder and CEO of Fyxer, an AI-powered email assistant that predicts and drafts emails for busy professionals. Richard and his brother Archie grew up on a farm, but they knew the slow pace of agricultural life wasn't for them. They saw tech as the opposite environment—fast feedback loops, results within your control. They started by building the UK's largest executive assistant agency, bootstrapping it to $5M in revenue. But from day one, they had a bigger vision: turning the service into software. For years, they tried to build "tech-enabled" solutions, but nothing worked to pull the price down enough for the mass market. Then GPT-3 launched. It was the breakthrough they'd been waiting for. Unlike other AI SaaS startups starting from scratch, Fyxer had a secret weapon: six years of detailed logs from human assistants. They knew exactly how an EA organizes an inbox because they had thousands of hours of data on it. They used this proprietary data to train their AI models, ensuring their product was more accurate than a generic LLM wrapper. The growth was explosive. They started the year with $1M ARR and a team of four. Within 9 months, they hit $18M ARR. They moved to San Francisco, joined an AI residency, and shifted their focus from "Tech Bros" to "Professional Services"—real estate brokers, consultants, recruiters—people who actually drown in email. One of their biggest wins came from a single signup via a Facebook ad. That user turned out to be the CEO of a massive real estate brokerage. Within 7 days, Richard's brother Archie flew to Seattle, met the CEO at his lake house, and closed a $1.2M deal to roll Fyxer out to 5,000 employees.

Stefan Bader, Cello

First Customers From a Notion Page and Python Scripts

Stefan Bader is the co-founder and CEO of Cello, an all-in-one referral platform that helps SaaS companies reward their users for bringing in new customers. Back when Stefan was Chief Revenue Officer at a payment processing company, he noticed something odd. His users were bringing in tons of new customers, but there was no way to reward them. Every tool out there was for affiliates and influencers. Stefan saw the opportunity. And in 2022, he quit his job and started Cello. But building it turned out to be way harder than he'd imagined. Paying individual users meant navigating compliance laws in dozens of countries, international banking regulations, and tax requirements that no one had mapped out before. And his MVP was embarrassingly basic. Customers got their analytics through shared Notion pages. No login portal. No dashboard. Just Stefan's team running Python scripts and configuring everything manually behind the scenes. "This is not a product," one early customer told him. But Stefan stayed focused on what mattered - could it actually generate referrals? The answer was yes. He also made pricing dead simple - pay nothing until you make money from referrals. However, most SaaS companies didn't even know they needed this product. Stefan had to educate every prospect about why user referrals were different from affiliate programs, and why they were leaving money on the table. As early customers started seeing results, word spread. But the real breakthrough came from something tiny - a "powered by Cello" link in their widget. As customers grew, millions of their users saw it. That little link became their biggest growth driver. Today, Cello generates $2.5M in ARR, powers referral programs for companies like Miro and Typeform, and reaches over 7 million users each month.

←All Episodes