A few years ago, I met with a SaaS startup who was looking for someone to lead their customer success team.  Interesting product, good funding, early traction, 50-70 clients - everything sounded great.  But as I dug into their customer success model, I saw a big problem - their customer success ratios. They were charging $30,000 yearly on average and their customer success managers (CSMs) were managing on average 7 accounts - meaning each CSM was managing $210,000 yearly and spending 18.5 hours per month per client.  

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When you are building your customer success team, you probably spend a lot of time trying to figure out how to segment accounts - do you want to divide up accounts by vertical?  By region?  By MRR?  Or by however sales does it?  And once you come up with the perfect division, you will probably spend a lot of time trying to figure out the right number of accounts per CSM, probably by the amount of ARR each CSM is carrying.  You are also coming up with a plan and strategy about how to use that time:  quarterly business reviews, product updates, adoption reporting, and so on.  

While you are making these choices, the most important thing to consider is how many hours your ratio will allow you to dedicate per client per month. 

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After proposing a Customer Success Manager (CSM) structure to a team of leaders at a previous company, the very next question was, "But what are other companies doing?"

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