Chapter 8: Return on Investment
What’s the ROI?
ROI, return on investment, financial discipline, investment, entrepreneur finance
At some point in your B2B sales career, someone is going to lean back in their chair, cross their arms, and ask you: “What’s the ROI?”
Get ready. Because if you’re not ready, you’re going to fumble it — and you’re going to lose the deal not because your product doesn’t deliver, but because you couldn’t make the case in a language the person in front of you could understand.
I learned this the hard way.
The Question You Will Get
Let me be clear about when this matters: if you’re selling business to consumer, you probably won’t hear this question. People don’t ask for the ROI on a new pair of running shoes or a streaming subscription. They just decide.
But in B2B — business to business — you are going to get this question. Every time. It is a standard part of the conversation, and there is no way to avoid it. So don’t try to avoid it. Prepare for it.
Here’s the thing that took me an embarrassingly long time to figure out: many of the people asking “what’s your ROI?” don’t fully understand what they’re asking. And they definitely don’t always understand the answer when you give it.
That’s not an insult to them. It’s just reality. “ROI” has become a business buzzword, a reflex question that gets asked in every boardroom and every procurement meeting. People know they’re supposed to ask it. That doesn’t mean they’ve got a finance background or that they know what net present value means.
So you have to be ready with two answers. One for the CFO. One for everyone else.
Two Versions of the Same Truth
I have a finance and accounting background. I’m comfortable with NPV — net present value — and with internal rate of return. When I first started doing ROI analyses for customers, I’d say, “Give me a few numbers I can’t get from the outside, and I’ll build you something.” Then I’d sit down and walk them through a proper model. Discount rate, cash flows, IRR. The works.
The CFO loved it. The CFO always loved it.
But the CFO isn’t always the only person you’re presenting to. Often you’re in a room with a vice president of operations, a marketing director, a procurement officer, somebody from IT. And these are smart, capable people who are very good at their jobs — jobs that don’t involve discounting cash flows.
I had to learn to translate.
The version that works for everyone: “You spend X with me, and I save you three X.”
That’s it. That’s the whole thing. Not NPV, not IRR — just a simple ratio that any person in any room can immediately grasp. You spend a dollar, you get three dollars back. The math is right there. No assumptions about discount rates, no multi-year horizon to keep track of, no finance jargon standing between your customer and the idea that this is a good investment.
Both versions are saying the same true thing. The NPV model is just a more rigorous expression of the same underlying reality. Your CFO is going to want it, and the CFO you’re selling to will likely want it too — so yes, build the model. Have it ready. Share it when appropriate. But don’t walk into a general business meeting leading with IRR and expect that to close the deal.
Lead with “you spend one, you get three back.” Then prove it.
The Proof Problem — and Why Beta Customers Are Gold
“Prove it” is the hard part.
You can build an ROI model from first principles — estimate the time your product saves, multiply by average hourly cost, apply some productivity factor, and arrive at a number. It’s defensible if you do it carefully. But a smart customer can pick holes in assumptions. They can push back on your estimates. They can say, “That’s your model. What does it look like with our numbers?”
The much stronger position is walking in with real data.
If you have beta customers — early adopters who are genuinely engaged with your product — go ask them for their before-and-after numbers. What did the process cost before? What does it cost now? How many hours per week did this take before your product existed, and how many does it take today? Not every customer will share this, but many will, especially early customers who believe in what you’re building. They want you to succeed too.
Real data from real users beats any model you build from assumptions. It has names attached to it, and names mean credibility. “Our customer at [Company X] reduced their processing time by 40% in the first quarter” lands very differently than “our model suggests productivity improvements of approximately 30–45%.”
This is another reason to treat your early customers well and to stay close to them. They’re not just your first revenue. They’re building the evidentiary foundation that makes every future sales conversation easier.
The Discipline You Apply to Yourself
Here’s where I want to push this beyond just a selling tool, because ROI thinking should run through everything you do as an entrepreneur — not just the pitch deck.
Every significant decision you make is an investment. You’re investing time, money, attention, people. And before you commit, the question you should be asking is: what’s the return on this?
Hiring a salesperson before you’ve figured out your pitch is an investment with a very uncertain return. Spending six months perfecting a feature that no customer has asked for — same problem. Taking on a big tradeshow booth because your competitor does it — what’s the expected return, and how does it compare to three months of targeted outreach?
I’m not saying you have to build a spreadsheet for every decision. But you should have the habit of asking the question. What do I expect to get back from this, and is that return worth what I’m putting in?
Finance people think this way automatically. If you don’t have a finance background, you have to develop it deliberately. Make it a practice. When someone on your team proposes an initiative, ask: what’s the expected return? How will we know if it worked? What does success look like in measurable terms?
This is what separates entrepreneurs who make principled decisions from the ones who run around reacting to everything. The ones who ask “what’s the return on this?” before they spend — time or money — are the ones who learn faster, waste less, and build more durable businesses.
Know Both Versions
I’ll say the same thing about ROI that I said about value propositions: this is real work, and it’s worth doing. Not fun work, necessarily. Not the exciting part of building a company. But when you’re standing in front of a customer and they ask the question — and they will ask the question — you want to have done this work already.
Know your CFO version. Know your “you spend one, you save three” version. Have your beta customer data if you can get it. And don’t walk in assuming that the person asking “what’s your ROI?” understands the answer any better than you did the first time you heard the question.
They just want to know if the math works in their favor. Your job is to show them that it does — clearly, simply, and with evidence they can take back to their boss.
That’s not dumbing it down. That’s doing the job right.
There’s one more thing I want to talk to you about before we’re done with the tactical material — and it has nothing to do with spreadsheets. It’s the life you’re signing up for. Because the business is only part of it.