topic Re: Recurring Revenue & Renewals in 💬 RevOps Discussions

Recurring Revenue & Renewals

Lanny-Heiz — Thu, 13 Apr 2023 13:05:19 GMT

Hi all,

RevOps from a B2B SaaS here and looking for some best practices and how to accurately track up, cross, downsells and churn.

Here's our setup:

We have the full ENT suite.

One pipeline for new sales & one for renewals (Stages are Upcoming renewal, t-180, closed won and closed lost)

Once a new sales deal is won, a workflow creates a new deal in the renewal pipeline with the same parameters (basically duplicating it)

To track ARR etc. in HubSpot correctly you need to use the RR properties (see more here).

I.e. you need to set a RR inactive date and a reason (Churned, Renewal, Upgrade, and Downgrade).

Now my question is what values do I set for these properties in the original (new sales) deal?

For the RR inactive date I set the end of the contract?
For the RR inactive reason I set what?

If I get HubSpot logic correctly, I'd set that inactive reason once my renewal deal closes?

This seems very impractical as my CSM would have to find the right original deal and update that?

How are other B2B SaaS companies doing this?

Re: Recurring Revenue & Renewals

kvlschaefer — Fri, 14 Apr 2023 07:38:14 GMT

Hi @Lanny-Heiz,

Thanks for reaching out to the Community and for the detailed information!

Let's invite our community members to this conversation.

Hi @jolle, @chris_remotish, @DougS, @Jnix284, @danmoyle - Do you have any insight for @Lanny-Heiz?

Thank you!

Best,

Kristen

Re: Recurring Revenue & Renewals

danmoyle — Fri, 14 Apr 2023 18:10:39 GMT

Thanks for thinking of me @kvlschaefer - unforstunately I don't have experience with this specific use case, so I have no insight to offer. I'll ask my colleagues though and if I learn anything, I'll share here with you @Lanny-Heiz.

Re: Recurring Revenue & Renewals

DougS — Sat, 15 Apr 2023 08:26:07 GMT

So the friction comes from your CSM having to find the right original deal and update it at the right time? And you'd like to HubSpot to automate this step accurately. Correct?

From a RevOps perspective and at the risk of making a mountain out of a molehill, please indulge my comments.

For the date question, have you asked someone in finance if they are running the accounting on an accural or cash basis? Although bookings fall into CRM, billings and cash flow live in their General Ledger or ERP system and revenue is too often tracked in a series of complex spreadsheets. They might tell you to set 'end of contract' or the 'date of last payment', or 'when the receipt of money was recognized' as the RR inactive date, or they might have another suggestion.

I see the deal properties with datetimes that include create date and close date. Can you set up automation email that goes to the CSM when a new deal closes on the same account with the last deal that closed or the latest two created deals dates?

For the inactive reason question, what about asking the Chief Sales Officer, or Customer Service Leader what the categories of reasons they already use for changed subscription status? Add those pre-selects to the properties.

Re: Recurring Revenue & Renewals

Jnix284 — Sat, 15 Apr 2023 13:53:30 GMT

@kvlschaefer ditto what @danmoyle said, but hopefully the others will be able to help!

Re: Recurring Revenue & Renewals

Lanny-Heiz — Fri, 21 Apr 2023 09:56:48 GMT

Hi @DougS for the detailed answer.

You've understood the problem correctly.

1. The RR inactive date I can solve with a contract duration property. That is fine.

2. The inactive reasons are predefined by HubSpot and cannot be changed. The goal is to automate the process of setting the RR inactive reason.

Context: most deals (70%) have no active sales/CSM involvement, as they are renewed automatically (self-service). So setting it manually in the original deal is not really an option as the manual workload is not manageable.

Re: Recurring Revenue & Renewals

AudreyM — Wed, 19 Jul 2023 16:55:00 GMT

I am piloting this - so take this as a very BETA set of options but here's what I'm doing [Note at present it requires Zapier to get it fully automated so if that's not in your stack, this might not help but the first bit might help your CSMs find the deal]:

We keep the contract effective dates on our deals and have a separate date field for “Contract Start” and “Contract End”
We use a workflow to create the renewal deal at the time that the original source deal closed - on this workflow

Copy the Record ID of the ORIGINAL deal to the Renewal Deal in a field called "Deal ID that Spawn Renewal".
Copy the original deal amount to a field called "Previous Deal RR", and then I have a calculated field that is called "RR Delta" - it subtracts the "Amount" from the "Previous Deal RR" for the next bit.

For subsequent renewals, when the renewal deal closes, it spawns the next renewal using a similar renewal workflow

At the point of the RENEWAL closure, you can use a workflow to copy the inactive date from the contract end date.
Use some branching logic = “RR Delta = Zero” then you can set the inactive reason to “renewal”, if RR Delta > 0, set the inactive reason to upgrade, etc.

For the FIRST deal - ie the new deal that closes, we spawn the renewal when that deal CLOSES, which means it’s created as much as 12/24/36 months in advance, and so we don’t know if that’s an upgrade or a downgrade or a renewal and the workflow no long has both deals automatically in it. That’s where I’m deploying Zapier:

When deal stage on the first RENEWAL is closed-won, then it triggers Zapier.
Filter to make sure that the next fields aren’t already set (so you don’t overwrite your workflow logic and cost yourself Zapier tasks)
Use Paths to reproduce the RR delta logic above, and have it “update a deal” where the “object ID’ is the “Deal that spawned the renewal” field.

Re: Recurring Revenue & Renewals

kvlschaefer — Wed, 19 Jul 2023 17:26:30 GMT

Hi @AudreyM,

Thanks for taking the time to share your work with us!

This looks great 😄

Cheers,

Kristen

Re: Recurring Revenue & Renewals

louischausse — Tue, 05 Mar 2024 18:47:41 GMT

We've built a Recipe to handle Renewals. A Recipe is a small process that you can install in your HubSpot portal. This doesn't require any third-party tool.

Here's a video of how it works:

Watch the video!

Renewal deals are created automatically for each closed-won deals with a known contract end date. Then, a task is generated with a reminder date XX days before that contract end date to notify the deal owner (or another user of your choice) that the renewal is coming soon.

Other settings and configurations are also available to suit your use case.

If you are interested, we can have a chat to setup this recipe on your HubSpot portal.

Learn more here

Re: Recurring Revenue & Renewals

Jnix284 — Tue, 05 Mar 2024 22:46:18 GMT

Thanks for sharing this @louischausse, it's very cool you've packaged this together to have a prebuilt option for contract renewals, this is something our team builds out manually quite often!