Is the main growth bottleneck for startups demand generation or conversion?

Sam Blond · Apr 12, 2024

Roughly four out of five startups misdiagnose their growth bottleneck as conversion rates when the real bottleneck is demand generation and opportunity creation.

When founders miss a target they blame a couple of deals that pushed, and doubling opportunity volume is far more achievable than doubling conversion rates.

Scope: assumes everything else remains constant

35:12 20Sales: The Biggest Sales Lessons Scaling Brex to $400M ARR, Why Startups are Doing Outbound Wrong and How to Fix It & Why Demand Gen is the Bottleneck for all Startups and How to Solve it with Sam Blond, Former CRO @ Brex

Sam Blond · Apr 12, 2024

Demand masks most other problems, and startups misallocate resources by staffing more salespeople than people focused on opportunity creation.

Resources get mapped to the misdiagnosed bottleneck — the middle of the funnel — instead of to top-of-funnel demand generation.

Scope: applies to almost all startups

37:25 20Sales: The Biggest Sales Lessons Scaling Brex to $400M ARR, Why Startups are Doing Outbound Wrong and How to Fix It & Why Demand Gen is the Bottleneck for all Startups and How to Solve it with Sam Blond, Former CRO @ Brex

Patrick Forquer · May 11, 2026

Legora's binding constraint was never conversion but simply being in the room — brand awareness is therefore everything.

They convert pilots into closed-won 78% of the time, but outside the legal tech in-crowd nobody knew them, so they were late to a lot of deals.

17:07 20VC: Inside Legora: $100M ARR in 18 Months | Jude Law Generated $50M in Sales Pipeline: The Economics Broken Down | Competing Against Harvey, the 800 Pound Gorilla | Why Legora is Undervalued at $5.5BN with Patrick Forquer, CRO @ Legora

Hila Qu · Jan 18, 2023

Activation and conversion are the best first growth levers because they are the easiest places to find quick wins

Wins change people's perception of you, unlock resources and make everything else easier; new-user funnel audits reliably surface low-hanging fruit in marketing, signup, onboarding and purchase flows

39:33 20Growth: When To Make Your First Growth Hire? How To Structure the Hiring Process for Growth? Five Core Things the Best Growth Hires Do in the First Week? What to Expect New Growth Hires to Achieve in the First 30 and 90 Days with Hila Qu, Growth Advisor

Harry Stebbings · Apr 12, 2024 · hedged

Increasing conversion is preferable to generating more leads, because high-quality leads are hard to come by and a lead burned once is even harder to win back.

Founders can build a more structured sales process and get personally involved to lift conversion, whereas doubling quality leads may not be easier and wastes scarce leads.

Scope: pushing back respectfully; uncertain whether 2x leads is truly easier

36:55 20Sales: The Biggest Sales Lessons Scaling Brex to $400M ARR, Why Startups are Doing Outbound Wrong and How to Fix It & Why Demand Gen is the Bottleneck for all Startups and How to Solve it with Sam Blond, Former CRO @ Brex