Chapter 13: Houston, We Have a Problem

What do you do when the stakes get higher, and the strategy must shift? This chapter reveals Signavio’s bold pivot from engineering-driven decisions to Go-To-Market excellence.

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Transcript

In 2017, we launched the rocket ship, finally.

It started with Mark Holenstein joining our team on January 1.

Mark had worked for SAP until the very last day of December, closing out the year as the Chief Revenue Officer for SAP CX. Mark was a numbers-driven leader, a controller by training, and his focus was relentless. He absolutely wanted to finish the year with his team at SAP achieving over €100 million euros in new ARR. Once he met that goal, he was ready for his next challenge - replicating the success of Hybris with Signavio. For Mark, everything revolved around numbers: he aimed to take our company from €10 million to €50 million euros ARR.

Our investor Matthias had always emphasized the importance of reaching the €50 million euro milestone. Very few software companies ever achieved this point, and doing so meant that the market truly needed your product and that you had a scalable Go-To-Market engine in place. For our investors, it also carried significant weight - strategic acquirers often paid a premium for companies that crossed this milestone.

With David joining the year prior, I got a first taste of a scalable Go-To-Market approach. I always found it reassuring when people had more experience than I had. When they had a good plan, I believed in it and trusted that it would work.

What impressed me most about Mark was that he didn’t just come in and tell people what to do. Unlike other candidates who confidently declared they would fix things by doing A, B, and then C in quick succession, Mark took a more thoughtful approach. He spent time observing what Gerrit, David, and Daniel were doing with their teams in the U.S., Germany, and Singapore.

The first thing Mark realized was that we didn’t have a proper sales forecasting mechanism in place. Although we had been using a CRM since the beginning, the data in there was often unusable or plain misrepresenting the reality. He introduced a weekly forecast call and a standardized framework for opportunity qualification.

Mark was religious about CRM usage. If he found out that someone didn’t use the system properly, he threatened to withhold that person’s bonus payment until they did.

Sellers sometimes complained: “Do you want me to fill in the CRM system or rather close deals?” And Mark would respond: “You will not close deals if you can’t even use the CRM system properly. So you’d better get your act together.”

Another great colleague joined at the same time - Deepanker Dua. He had worked for Salesforce before and had helped them roll out their Go-To-Market approach in Asia. Now based in Berlin, he became Mark’s right-hand for sales operations and enablement. We introduced week-long bootcamps for new hires, pitch contests and account reviews. Once a quarter, Deep held a “celebrating success” session, discussing recent customer wins with sellers, presellers and customer success managers. He was a Thomas Gottschalk fan, and for the occasion of “celebrating success”, he wore a curly-haired wig and colorful clothes and brought Gummy Bears, imitating the famous “Wetten dass” TV show.

Signavio changed quite a bit in those days. Before, we had been an engineering-centric company. Our main focus had been on product development, building innovative solutions that addressed our users’ needs. But with the re-launch in the U.S. the year prior, everything shifted. For the first time in our company’s history, we were spending more on Go-To-Market efforts than on development. This marked a pivotal change. With the new momentum, we became a Go-To-Market-centric company, and soon, our sales and marketing budget outpaced our engineering budget by a significant factor. Only much later, after the SAP acquisition, the investment into development would outpace Go-To-Market again.

In one of our All Hands calls, Mark highlighted an area that needed attention: our low average deal size. At the time, the average order size across new customers and upsells was €9,000 euros. To illustrate how small this was, he quipped, “A fridge costs €9,000 euros.” The comment drew puzzled reactions from many of our younger employees, who were still students. 

They came to me afterward, asking, “What kind of fridge costs €9,000 euros? What world does Mark live in?” It was a moment that underscored the perception adjustments of an evolving culture - moving from our engineering roots to a business-focused approach where every euro counted in driving growth.

With this new emphasis on Go-To-Market and the addition of outbound lead generation, it was clear we needed to fine-tune our messaging and align our product strategy more closely with market demands. 

My colleague Mark McGregor had a brilliant idea: we would position Signavio as a “Business Transformation Suite.” This framing emphasized the positive outcomes of business change rather than focusing narrowly on process management alone. It took some time for this new positioning to permeate the Go-To-Market organization, but it ultimately proved incredibly powerful and resonated with our customers over the years.

Part of building out this Suite concept meant reinventing our Collaboration Hub. We made it the central component linking our product offerings. Or as our product managers phrased it: “Hub first”. Our ambition was always to engage a large number of users within a company, and creating meaningful focus and encouraging user engagement within our products became a top priority. The journey to building a true Suite offering took years, requiring relentless focus, iteration, and investment.

As we scaled, we had to balance our evolving market goals with maintaining a strong team culture. Building a high-functioning team required trust at its core - trust between team members, trust in our leaders, and trust that everyone was aligned with the company’s values. This became especially important as we brought in new leaders who could uphold and build on what we had created. Mark’s data-driven approach marked a significant shift - from relying on gut-based decisions to trusting proven market mechanics and frameworks essential for scaling rapidly.

Mark’s influence on our sales strategy was transformative. He brought order to what had previously been a “jungle” of individual deals, implementing structured pipeline-building, projections, and capacity planning. This structure enabled us to move quickly but with clarity and purpose, ensuring every effort contributed to our overarching goals.

Over time, our sales philosophy matured significantly. We moved away from a purely transactional model and shifted towards value-based selling that focused on delivering transformative outcomes for our customers. It wasn’t just about getting deals in the door anymore; it was about showing customers how we could fundamentally change their business for the better. 

This evolution taught us a lot. We had to deeply understand what customers were willing to pay for and ensure that our product positioning aligned with the value they perceived. It was a learning curve, but one that forced us to be more intentional in how we approached deals. 

Mark played a critical role in this transition. His vast experience in sales was invaluable. He always stressed the importance of matching customer expectations with the right “price tag.” It wasn’t about squeezing out as much revenue as possible; it was about making sure customers saw and believed in the value we were bringing. That’s when real, lasting partnerships started to form.

In Q2, we launched EMEA as a new region. EMEA stands for Europe, Middle East, and Africa. The name was somewhat misleading because it would take many more years before we truly established a presence in the Middle East and Africa. In fact, not even all of Europe was included in our initial scope. The immediate focus was really on the UK and a small number of other countries, as the German-speaking markets were already covered by Gerrit’s MEE team. MEE stands for Middle and Eastern Europe, an abbreviation that we adopted from SAP, Mark’s previous employer.

To lead the EMEA region, Mark brought in Ian Pollard, a seasoned and highly effective leader. Ian was a real heavy hitter. In his previous jobs, he had remarkable success in launching and growing the European business for the cloud companies Box and Veeva. He, in turn, recruited an A list of colleagues from RightNow, Dropbox and other high profile cloud software companies in a few weeks.

As part of our EMEA expansion, we established legal entities in several countries. First was Signavio UK, followed by Signavio Netherlands, Signavio France, and Signavio Nordics. This rapid growth within the Go-To-Market team, combined with continued hiring in engineering, nearly doubled our team size in under six months.

At the same time, we began building our finance and admin team for the first time. Previously, we relied on simple accounting tools, often different ones in each country. Customer information was stored in our CRM system, and we used custom scripts to generate invoices. This made financial consolidation difficult and accurate reporting nearly impossible. With local service providers handling accounting, it typically took three to four weeks after the end of each month to receive our financial figures per country.

Honestly, I didn’t see the problem with that. In the end, all that mattered was that we built a great product and successfully brought it to market. However, my investors and also my CFO strongly disagreed and had demanded that we introduce proper monthly reporting and a proper ERP to manage all numbers.

Here we were in Q2 of 2017. In addition to opening operations in several new countries, rapidly expanding our team, and bringing the finance function in-house, we also went live with our new ERP system - all within the same quarter. Looking back, we should have seen the trouble brewing, but at the time, we didn’t.

It was a perfect storm and marked the beginning of what felt like the near-death of Signavio.

I never cared about finance. When Torben was with us, he took care of it. The episode where he left abruptly a couple of years earlier - and then returned - had been a wake-up call, briefly pulling me into the world of financial oversight. But once stability returned, I became complacent again, assuming everything was fine. We had successfully navigated the challenges of fundraising in 2015, brought on excellent investors, and had an experienced CFO managing our finances for over a year. What could possibly go wrong?

From a sales perspective, Q2 was another standout quarter. Mark proudly reported that we had exceeded our highly ambitious targets by 10%, delivering almost three times the new ARR compared to the same quarter of the previous year. The results were extraordinary. We celebrated, high-fived, and looked forward to taking a much-needed break over the summer.

For the end of July, my wife and I planned a big celebration. Karolina and I had been married for five years, but up until then, we had only done the civil wedding. Back then, we only had a very small celebration with our closest family members.

I always wanted a big, Polish wedding with a massive party and tons of friends. Finally, we set July 22 as the date for our church wedding in a small Polish village just outside the town where Karolina grew up. We spared no detail. We rented an entire hotel, an old palace with beautiful gardens, all within walking distance of the church. The plan was for a 48-hour celebration, starting on Friday afternoon with a barbecue and party, continuing on Saturday morning with various activities, followed by the wedding in the afternoon and then a massive celebration in the evening and well into the night. We wanted to make it worth the trip for our friends, many of whom would be driving long hours to reach the Polish countryside.

One week before the wedding, my CFO presented the latest cash flow report. Steffan from Summit Partners was the first to review it, and then it landed on my desk. I hated dealing with these kinds of documents and often just ignored them.

The numbers were a total disaster. In just one quarter, our cash levels had taken a significant hit. If the trend continued, our bank account would be empty within months.

What had gone wrong? It wasn’t due to higher-than-expected costs. Nor did we have any issues with customer sales or churn. In fact, we had just come off a phenomenal quarter.

The problem: We simply hadn’t sent out any invoices for several weeks!

Before moving to the new ERP system, our CRM script had handled producing and issuing invoices for our subscription customers. For other cases, like consulting services, we manually created invoices using Microsoft Word. It wasn’t perfect, but it worked.

With the move to ERP, the goal was that this new system would generate and issue all new invoices. But things didn’t go as planned. The system was still not properly set up, and the data migration had been a disaster.

I was unaware of how bad things were. I had checked in with my CFO occasionally, and he usually reassured me that while the process was bumpy, things were under control.

In reality, nothing was under control. We had stopped issuing invoices through the old methods but were unable to issue them through the new system either. For more than two months!

To make matters worse, our newly hired finance lead wasn’t working out, and my CFO was completely overwhelmed by the chaos. But the worst part? He hadn’t said a word about the mess all these weeks.

While we focused on building and selling our software, our cash reserves were quietly draining away.

Looking back, I see now how much trust I had implicitly transferred from Torben to the new CFO. Torben had been with us from the start; he knew the ins and outs of the company and had earned my trust through countless challenges. But as we grew beyond the tight-knit environment of a small company into an international operation, I mistakenly assumed that the same level of trust and hands-off management would carry over to new leaders. This was a crucial learning moment. 

As we scaled, the need for transparent communication, accountability, and closer oversight became painfully clear. I had to evolve as a leader, ensuring that our expanding team could handle growth while maintaining the trust, and alignment that had made Signavio successful.

What a nightmare this was! Torben was long gone, and just one week before my wedding, I had completely lost trust in my CFO.

Matthias Allgaier and Leo were in town for the board meeting. Traditionally, we would meet for dinner the evening before, but given the urgency, we met at their hotel beforehand to discuss the crisis.

It was a warm summer afternoon, with a gentle breeze blowing through the rooftop bar of the Hotel de Rome. I was nervous like hell. 

My last day as CEO of Signavio would at least be a beautiful day, I thought to myself. While I waited for Matthias and Leo, I finished a whole bowl of cashew nuts.

I fully expected them to tear me apart. I had miserably failed as the leader of the company. I hadn’t seen the problems coming, hadn’t tracked even essential numbers, hadn’t put any controls in place during this critical phase. I was obviously not fit for my role as CEO. I was a loser who had let such a formidable company crash into the wall. I wanted to offer my resignation.

Matthias and Leo arrived. I told them that I was extremely sorry and that I had failed the company. They looked at me, puzzled, and said I had actually done a great job and congratulated me on the successful quarter. “We just need to fix the finance function as fast as possible,” Leo said. 

Unfortunately, we didn’t have anyone on the team who could step into the CFO role immediately. The finance leader we had recently hired didn’t work out, and we had to let him go after just a few weeks. My CFO was too deeply involved in operational details, and removing him without a plan would create even more chaos.

The conclusion was to bring “professional supervision” on board - an interim CFO who would oversee critical functions, especially invoicing and cash collection, while my current CFO remained involved in day-to-day operations. We even brought Torben back again to help with the financial firefighting. We would then trigger the search for a new CFO as fast as possible and transition over the earliest possible.

We also had to consider a cash injection to protect against the worst-case scenario. Matthias raised the possibility of investing more money, but warned that the terms might not be favorable, especially if we didn’t see quick improvements in finance operations.

For the dinner, Matthias and Leo chose particular seats at the table. Normally, most attention went to Mark and Go-To-Market topics. This time, Matthias and Leo set my CFO in their middle and expressed their frustration very clearly. 

That evening, it became obvious to everyone: My CFO needed to go.

A couple of days later, I left for Poland ahead of the wedding. My CFO had been invited too but chose not to come. We hadn’t spoken much since the tense board dinner. I’ve never been good at facing conflict.

The wedding was a blast, a wonderful weekend from start to finish. I completely forgot about the issues at Signavio, at least for a couple of days.

On Sunday afternoon, once all guests had departed, the clouds all came back. Karolina and I had planned to fly to Rome for our honeymoon. We decided to stay in Poland instead. That way, I could also focus on triggering the next steps regarding our finance issue.

I launched the search for an interim CFO immediately and started interviewing the first candidates over Zoom while still in Poland.

The coming months were dominated by the damn invoice issue. The situation was far worse than I initially believed. The data quality was terrible, and despite our best efforts, we still struggled to get invoices out accurately and on time. Migrating contracts from our homegrown solution to the new ERP system turned into a nightmare. The process was fraught with complications, and our customers were anything but quiet about it. 

Complaints poured in about faulty invoices. 

“How can you call yourself a process management company if you can’t even issue correct invoices?” was one of the more cutting remarks we heard - and it stung.

To make matters worse, many customers simply didn’t respond when they received an invoice containing errors. They simply didn’t pay and ignored the reminder emails that we sent them.

The situation deteriorated to the point that we had to involve our sales team in chasing down payments. We started holding back commission payments until customers had actually paid the corresponding invoice. It was a painful move and created a massive distraction, especially for our top performers - the people who had brought in so much business. Now, instead of focusing on new sales, they were dragged into resolving our invoicing crisis.

The issue became a major focus during our weekly check-ins with investors, as we monitored cash levels and accounts receivable status. Progress was slow and painful; even as things gradually improved, we continued to lag behind for months.

Some of the worst cases took ages to resolve. I vividly remember the ordeal with ALDI, one of our larger customers. Despite sending countless payment reminders, emails, and making phone calls, we couldn’t get them to pay. We even considered shutting down their cloud access to force their hand. It was deeply frustrating.

Then we discovered our embarrassing mistake: during the data migration to the new ERP system, we had used a data enrichment service to fill in missing account information. In doing so, the service had incorrectly filled in details for ALDI Nord, a completely separate company from ALDI Süd - our actual customer. We had been chasing the wrong entity for months. The realization was as mortifying as it was infuriating. Once we corrected the error and properly invoiced the right company, ALDI Süd paid promptly.

The invoicing mess dragged on for months, with new mistakes in the data becoming evident only when invoices were issued and became due. Each billing cycle brought fresh complications. By the end of 2017, things were finally starting to stabilize. One last batch of invoices was sent out in early January, covering those crucial Q4 deals from the previous year. With that, we hoped to finally put the crisis behind us.

Throughout the challenges and milestones of Signavio’s journey, one thing has always remained clear to me: true success is a collective effort. While I’ve often been described as “lucky” or fortunate in the path that unfolded, any positive outcome we achieved was built on the strength, resilience, and dedication of the entire Signavio team. Emphasizing team success over individual credit has always felt far more authentic. This mindset - of working as one cohesive unit - carried us through difficult times.

Reflecting on some of the more high-stress moments, like our invoicing crisis, I now see them with a mix of pride and humility. At the time, the stress was suffocating, the stakes were enormous. But looking back, I see how our team’s grit and collaboration pulled us through. Every setback was a test of our focus and our ability to function as a unit. We learned that struggling together and thriving together as a team was far more rewarding - and far more meaningful - than any personal victory. We would all rather fail as a team than win alone. 

Signavio’s journey stands out not just within our industry but beyond it. In a crowded market filled with innovation and fierce competition, our story has become a testament to what is possible when a group of people believe in a vision and work relentlessly to make it real. 

Overcoming crises like the invoicing disaster taught me invaluable lessons about leadership, trust, and humility. We didn’t just survive those moments; we grew from them. We learned that facing adversity head-on, together, was the only way to emerge stronger. Our ability to come together, to share the burden of tough decisions and celebrate our wins collectively, became our greatest strength. The power of “we” far outweighed any notion of “I.”

So, when I revisit these memories - sometimes painful, often chaotic - I remember not just the stress but the pride of seeing how we rallied. These were more than just learning experiences; they were moments that shaped who we are as a company and who I became as a leader.

As December drew to a close, cash levels started to run low again. With year-end approaching and the risk of a cash crunch looming, we knew we needed an immediate cash injection. Bank loans were not an option for a company like ours, and raising capital from outside investors would have taken too long given the urgency of the situation.

So, I decided to accept Matthias’ offer for additional investment through Summit Partners that we had discussed earlier. We agreed on a modest increase in valuation compared to our previous fundraising round. At that point, my primary focus was sheer survival; there was little room for negotiation, and I was grateful for every euro Summit put in.

Given our rapid growth over the past two years, I knew the investment was a bargain from the investors’ perspective. To mitigate the dilution of our shares, I proposed that the founders reinvest some of the money we had taken off the table during our Series A fundraise. Torben welcomed the opportunity and invested a significant amount.

I also took this impromptu Series B fundraising as a chance to offer some of our key employees a chance to invest as well. This included three of our Go-To-Market leaders and one key contributor from the development team. Since some of them didn’t have enough funds to invest on their own, we, the founders, extended them a low-interest loan to make it possible.

Just like buying back shares from Mathias Weske, and handing out options upon the Series A fundraise to every employee, I felt that equity could be distributed even fairer to correctly reflect the contributions to our success. We had moved far beyond a state where only the founders were at the center. Our key employees had become just as important, and this was a first great opportunity to honor that.

Our core belief has always been that Signavio’s strength came from its people. By giving them an additional stake, we not only strengthened our culture of shared ownership, trust, and commitment, we embodied the idea that our success was truly a collective effort. 

Over Christmas, it was hard to chase all of the required signatures for the investment and we urgently needed cash for the December payroll. We, as founders, put in a bridge loan to be able to pay all salaries.

Finally, the Series B investment was secured, bringing in €15 million euros of fresh capital - €11 million euros from investors and €4 million from us founders and employees. It was a lifeline that kept the company afloat. With the immediate crisis behind us, we could once again focus on growing the business.

And the business didn’t just recover - it boomed. Under Mark’s leadership, we saw over 70% ARR growth in his first year. It was a truly remarkable achievement. 

And most importantly, we were still alive.

We closed out the year with €16 million euros in ARR and a team of 200 employees.