Deconstructing the Three Great Myths of Revenue Operations
As the principal of a single-family office, I occupy a peculiar space in the investment world. We don’t have the rigid fund cycles of venture capital, nor the quarterly pressures of the public markets. Our capital is patient, our timeline is generational, and our involvement is deep. When we invest in a technology company, we aren't just buying a line on a spreadsheet, we’re building a partnership.
My alpha if you will, isn't derived from presciently timing market trends, but from identifying promising companies and then actively helping them build durable, scalable engines for growth.
Over the last decade, I’ve sat in hundreds of boardrooms and listened to countless pitches. I’ve seen brilliant products fail and mediocre ones succeed. The difference, more often than not, lies not in the code or the charisma of the founder, but in the operational chassis of the business. Specifically, it lies in the company's ability to systematically and predictably acquire, retain, and expand its customer revenue.
This is the domain of Revenue Operations. And after rolling up my sleeves and implementing its principles across our portfolio, I’ve come to believe it is the single most critical, yet most profoundly misunderstood, function in modern business. The market is saturated with buzzwords and half-truths that obscure its true power. Founders often treat it as a luxury, a cost, or a simple rebranding of an old department. This is a catastrophic error.
From my unique vantage point, as both investor and operator, I see the same destructive myths derailing promising companies time and again. It’s time to dispel them.
Here are the three biggest, and most dangerous, myths in Revenue Operations.
Myth #1: "Revenue Operations is Rebranded Sales Ops"
This is, by far, the most common and fundamental misconception. I see it constantly during due diligence. I’ll ask a CEO about their RevOps strategy, and they’ll enthusiastically point me to their "Head of RevOps," who turns out to be a classic sales operations manager. Their days are consumed with managing the CRM, creating sales compensation plans, and generating pipeline reports for the Chief Revenue Officer. While these tasks are essential, they represent a single, isolated gear in a much larger machine. To mistake this gear for the entire engine is to miss the point entirely.
Sales Operations, by its very nature, is a siloed function. Its mandate is to make the sales team more efficient and effective. It lives and breathes within the four walls of the sales department. Its primary concerns are quota attainment, territory planning, and sales process adherence.
Revenue Operations, in its true form, is the antithesis of a silo. Its mandate is to optimize the entire customer lifecycle, from the very first marketing touchpoint to the moment a customer churns or renews, and every step in between. RevOps isn't beholden to Sales, Marketing, or Customer Success. It is beholden to revenue, and it serves as the connective tissue that binds those three historically disconnected departments into a single, cohesive revenue engine.
Think of it like this: a company with traditional, siloed operations is like a track and field team running a relay race. Marketing generates a lead (the first runner) and sprints to hand the baton to Sales. Often, the handoff is clumsy. The lead isn't qualified, the context is lost, and the baton gets dropped. If Sales (the second runner) manages to close the deal, they sprint to the finish line and hand the baton to Customer Success (the third runner). Again, the handoff is fraught with friction. Promises made during the sales process are unknown to the onboarding team, leading to a poor customer experience from day one. Each runner is optimizing for their own leg of the race, not the overall time.
A company with a true RevOps function is more like a world-class rowing crew. Everyone is in the same boat, facing the same direction, pulling on their oars in perfect synchrony. RevOps is the coxswain, the one who isn't rowing but is steering the boat, setting the rhythm, and ensuring that the combined effort of every individual rower translates into maximum forward velocity.
Let me give you a concrete example from our portfolio. We invested in a B2B SaaS company with a fantastic product for data analytics. Their top-line growth looked impressive, but a look under the hood revealed a "leaky bucket." Their customer acquisition cost was high, and their net revenue retention was hovering around a worrying 95%, indicating a churn problem.
The departments were at war. Marketing was proud of the thousands of "marketing qualified leads" they were generating. Sales complained that the leads were garbage, forcing them to spend most of their time prospecting from scratch. Customer Success was constantly fighting fires, dealing with clients who had been over-promised features by AEs desperate to hit their quota.
Our first move wasn't to fire the VP of Sales or pour more money into marketing. It was to hire a seasoned Head of Revenue Operations. This person reported directly to the CEO, not to a departmental head, giving them the authority and neutrality to orchestrate change across the entire go-to-market team.
Their first 90 days were not spent building dashboards. They were spent on diagnosis and alignment.
Process Mapping: They mapped the entire customer journey, from anonymous website visitor to loyal advocate. They interviewed team members from every department to identify every point of friction and every broken handoff.
Data Unification: They established a single source of truth for all customer data. No more "marketing numbers" versus "sales numbers." All metrics were derived from the same core dataset in the CRM.
Shared Definitions: For the first time, the company had a universal, data-driven definition for a "qualified lead." It was no longer a subjective judgment call but a score based on firmographics, engagement, and buying intent. This immediately aligned Marketing and Sales.
Aligned Incentives: They worked with finance and department heads to restructure incentives. The marketing team was no longer bonused solely on the volume of MQLs, but on the revenue generated from their leads. Sales commissions were clawed back if a new customer churned within the first six months due to misaligned expectations.
The results were transformative, but they didn't happen overnight. It took a year of hard, systemic work. But by breaking down the silos and treating the revenue process as a single, end-to-end system, we saw the CAC drop by 30% and the NRR climb to a healthy 115%.
That is the power of true RevOps. It’s not a new name for an old job. It’s a fundamental shift in organizational design and business philosophy. It’s the art and science of aligning people, processes, and data across the entire customer journey to drive predictable, scalable growth.
Myth #2: "The Answer is in the Tech Stack"
The second great myth is a direct byproduct of the SaaS explosion. Every go-to-market problem, it seems, can be solved by a new piece of software. Is your pipeline weak? There's a sales intelligence tool for that. Are your email campaigns underperforming? A marketing automation platform will fix it. Is customer data a mess? You need a Customer Data Platform.
Founders, often tech-centric themselves, are particularly susceptible to this myth. They believe that a perfectly curated tech stack, a constellation of Salesforce, Hubspot, Gainsight, and a dozen other acronyms will magically produce a high-functioning revenue engine.
From my investor’s chair, I see the wreckage of this thinking every day. I call it the "Frankenstack" a stitched-together monster of expensive, poorly integrated, and chronically underutilized software. Companies spend hundreds of thousands, sometimes millions, of dollars a year on licenses for tools that their teams barely understand. Data is duplicated across systems, creating multiple sources of "truth" and making reliable reporting impossible. The technology, which was supposed to provide clarity, instead creates chaos. It automates broken processes, amplifying their inefficiency.
The fundamental truth that RevOps champions is this: People, then Process, then Technology.
Technology is a powerful accelerator, but it cannot create a strategy that doesn't exist. It can enable a well-defined process, but it cannot fix a broken one. A world-class marathon runner in a $50 pair of sneakers will always beat an amateur in $500 carbon-plated super shoes. The gear helps, but only after the engine and the technique are sound.
One of our portfolio companies, a promising enterprise software firm, was drowning in technology. They had a top-tier CRM, a sophisticated marketing automation platform, and a best-in-class sales engagement tool. Yet, their sales cycle was nearly 12 months long, and their forecast accuracy was abysmal. The board was frustrated, and the CEO was convinced he needed to add yet another tool, a "predictive forecasting" AI platform, to solve the problem.
We intervened. We brought in a RevOps consultant to conduct an audit before they spent another dollar on software. The diagnosis was stark: the problem wasn't the technology; it was the complete lack of a defined process.
No Sales Methodology: The sales team was a collection of "lone wolves," each running their own process. There was no standardized way to qualify an opportunity, conduct discovery, or demonstrate value.
Undefined Stages: The CRM stages "Prospecting," "Qualification," "Proposal," "Negotiation" were meaningless. AEs moved deals between stages based on gut feel, not on the completion of verifiable exit criteria. A deal in the "Proposal" stage could mean anything from "we sent a boilerplate PDF" to "the customer has redlined our master services agreement."
Data Voids: Because the process was undefined, the data being entered into the multi-million dollar CRM was useless for forecasting. It was a collection of anecdotes, not structured data points.
The solution had nothing to do with buying new software. The RevOps team spent the next six months orchestrating a fundamental operational overhaul:
Process Definition: They worked with sales leadership to define and document a single, unified sales methodology. They broke down the sales cycle into clear, distinct stages.
Exit Criteria: For each stage, they established objective, verifiable exit criteria. A deal could not move from "Qualification" to "Discovery," for example, until the AE had confirmed budget, authority, need, and timeline (BANT) and logged that information in specific CRM fields.
Tool Configuration: Only after the process was defined did they touch the technology. They reconfigured their existing CRM to perfectly mirror the new sales process. They used automation to prompt reps for the right information at the right time and to prevent deals from moving forward without the required data. They integrated the sales engagement tool to track the specific activities required at each stage.
The "Frankenstack" was tamed. It became a powerful servant to the process, not its chaotic master. Within nine months, the sales cycle had shortened by 20%, and forecast accuracy improved from a coin-flip 50% to a reliable 85%. They achieved this not by adding technology, but by subtracting chaos and adding process.
RevOps understands that the tech stack is a means, not an end. The goal isn't to have the most impressive collection of logos on a slide. The goal is to build a seamless, data-driven process that technology can then scale and automate. Before you ask "What tool should we buy?", RevOps forces you to answer the more critical questions: "What are we trying to achieve? What is the ideal process to achieve it? And what are the minimum data requirements to measure it?"
Myth #3: "RevOps is a Cost Center for Dashboards"
This final myth is perhaps the most financially insidious. It relegates RevOps to the category of "overhead", a back-office function, like finance or HR, that is a necessary cost of doing business but doesn't directly contribute to the bottom line. In this view, the RevOps team are glorified report-builders, a small group of analysts who hound salespeople about CRM hygiene and generate pretty charts for board meetings.
When founders embrace this myth, they chronically underinvest in the function. They might hire a junior analyst to pull reports but will balk at the idea of hiring a senior, six-figure RevOps leader.
They see it as a non-quota-carrying expense, a luxury they can't afford until they are much larger.
They are wrong.
From an investor's perspective, this is like trying to build a skyscraper without investing in a strong foundation. It is a profoundly backward-looking view of value creation. A world-class RevOps function is not a cost center… it is the highest-leverage investment a company can make in its own scalable growth. It is the command center for the entire revenue engine, and its ROI is immense, albeit not always immediately obvious on a P&L statement.
The value of RevOps is best understood through the lens of the most critical metrics in any subscription business. Let’s consider the fundamental equation for a healthy SaaS company: the ratio of Customer Lifetime Value to Customer Acquisition Cost
A healthy business needs this ratio to be greater than 3. That is, for every dollar you spend to acquire a customer, you should expect to get at least three dollars back over the lifetime of that customer. A great business is pushing 5 or higher.
Traditional thinking holds that the way to improve this ratio is to hire more salespeople (to increase LTV by closing more deals) or to spend more on marketing (to lower CAC through scale). RevOps provides a more powerful, more efficient lever. A strategic RevOps function systematically improves this ratio by attacking its component parts with data and process.
How RevOps Increases LTV:
Reduces Churn: By ensuring a smooth handoff from Sales to Customer Success and standardizing the onboarding process, RevOps creates a better initial customer experience, which is a leading indicator of retention.
Drives Expansion Revenue: RevOps instruments the customer journey to identify upsell and cross-sell opportunities. They analyze product usage data and customer health scores to arm the Customer Success team with the insights they need to expand accounts proactively, not reactively. This is the single biggest driver of Net Revenue Retention, a metric I weigh more heavily than new logo acquisition.
How RevOps Decreases CAC:
Improves Funnel Conversion: By optimizing the lead lifecycle from MQL to closed-won, RevOps ensures that expensive marketing dollars aren't wasted on leads that leak out of the funnel due to slow follow-up or poor qualification.
Increases Sales Velocity: RevOps analyzes the sales cycle to identify bottlenecks. Where are deals getting stuck? They then implement process or enablement changes to accelerate deals through the pipeline. Shortening the sales cycle means each sales rep can handle more opportunities per year, making the entire team more productive and lowering the effective cost of acquisition.
Optimizes Territory and Comp Plans: RevOps uses data to design equitable sales territories and create compensation plans that motivate the right behaviors, ensuring that the company's single largest expense—its sales team—is deployed with maximum efficiency.
A few years ago, we had a portfolio company that was struggling to scale. They had product-market fit and a talented sales team, but their growth had plateaued. The CEO was convinced he needed to raise a large new round of funding to hire ten more AEs. We convinced him to first invest in a Director of Revenue Operations.
That new director came in and, by analyzing the data, discovered that over 40% of their "qualified" product demos were ending in a "no decision" because the prospect wasn't a good fit to begin with. The AEs were wasting nearly half their time on demos destined to go nowhere.
The RevOps director worked with Marketing to refine the lead scoring model and with the junior sales team (SDRs) to implement a more rigorous qualification checklist. The result? The number of demos fell by 30%, which initially panicked the VP of Sales. But the close rate on the remaining, higher-quality demos doubled. The sales team closed 40% more new business that quarter with the exact same headcount.
The ROI on that single RevOps hire was astronomical. He didn't just build a report, he re-architected the company's growth engine.
The Final View
As an investor, I’m in the business of buying future cash flows.
The predictability, scalability, and efficiency of those cash flows are paramount. A great product and a big addressable market are table stakes. The real differentiator—the factor that separates the good from the enduringly great—is a commitment to operational excellence.
Revenue Operations is not a buzzword, a department, or a piece of software. It is the operating system for revenue. It’s the discipline of instrumenting the entire customer lifecycle, aligning all go-to-market functions around a common set of processes and data, and continuously optimizing that system for growth.
When I look at a potential investment, I no longer just look at the product, the team, and the financials.
I look for evidence of a RevOps mindset. I look for a leader who understands that Sales, Marketing, and Customer Success are not separate kingdoms, but interconnected components of a single engine. I look for a culture that values process and data over heroics and intuition. And when I don't see it, I know that if we do invest, our first and most important job will be to build it.
Because in the long game of value creation, a superior revenue engine always wins.
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I started this in November 2023 because revenue technology and revenue operations methodologies started evolving so rapidly I needed a focal point to coalesce ideas, outline revenue system blueprints, discuss go-to-market strategy amplified by operational alignment and logistical support, and all topics related to revenue operations.
Mastering Revenue Operations is a central hub for the intersection of strategy, technology and revenue operations. Our audience includes Fortune 500 Executives, RevOps Leaders, Venture Capitalists and Entrepreneurs.