EP45: The founder’s guide to onboarding and activation

by | Jul 15, 2025 | Marketing, Podcast, SaaS | 0 comments

At DemandMaven, we’re passionate about helping founders unlock revenue they’re leaving on the table. In this week’s episode of the In Demand Podcast, Asia and Kim dive deep into one of the most overlooked growth levers in SaaS: onboarding and activation. If you’re not paying attention to activation, you’re missing out on significant revenue and better customer experiences.

Why activation feels like magic (but shouldn’t)

Activation is one of those mysterious aspects of growth that many founders treat as if it doesn’t have a “figure-outable” process. But here’s the truth: there absolutely is a systematic approach to solving activation challenges.

As Asia explains, “Anything that you don’t understand kind of seems like magic. The more that you understand activation, the less and less it feels and seems like magic.” The problem is that activation has many different inputs and factors, making it seem more complex than it actually is.

The reality: Most organizations either don’t have activation properly defined, or they’ve picked a metric out of thin air without understanding if it actually correlates with revenue.

Two schools of thought on activation

There are two main ways to think about activation:

Traditional Approach: Trial to conversion rate or new user to paying customer conversion rate

Leading Indicator Approach: The percentage of new signups who hit specific behaviors or milestones that indicate they’ve achieved value and are likely to become paying customers

The ideal activation metric comes before payment—it’s a leading indicator that someone will convert, not just the moment of conversion itself.

The secret to discovering your real activation metric

Stop trying to define your activation metric in a conference room. Instead, you need to discover it through data.

The New User Retention Report Method

This is the game-changing report Asia uses to identify real activation moments:

  1. Build the baseline: Track what percentage of new users return to your product day-over-day (day 0, day 1, day 2, etc.) and take any action
  2. Test different behaviors: Create variations of this report filtering for specific product actions (building reports, uploading documents, etc.)
  3. Look for the winners: Find behaviors that have high volume AND significantly better retention than your baseline

What to look for:

  • High sample size (not just 5 people)
  • Strong day 1, 2, 3 retention (anything above 50% is excellent)
  • Even a 2-3x improvement over baseline is worth pursuing

As Asia notes: “Even if you’re not seeing super crazy retention numbers, anything that’s better than your baseline, especially if it’s a multiple of X, go in that direction.”

The UX Interview: Your secret weapon

Here’s where most teams go wrong: they rely on session recordings or analytics without understanding what users are actually thinking and feeling.

How to Run Activation UX Interviews

You only need 3-5 interviews to uncover the major issues. Here’s the process:

  1. Find qualified prospects using UserInterviews.com or Respondent.io (95% of companies will find their audience here)
  2. Give them missions, not instructions: Don’t tell them what to click—ask them how they would accomplish a goal
  3. Watch them struggle: The magic happens when you observe where they pause, get confused, or make frustrated expressions
  4. Take notes on barriers: Look for cognitive overload, limited attention, and unclear next steps

Critical insight: Don’t just listen to what they say—watch what they do. People often say “it was so easy” while you literally watched them struggle for their lives.

The three most common activation barriers

From hundreds of UX interviews, these are the patterns Asia sees repeatedly:

  1. Cognitive overload: Too much happening on screen, users don’t know what to focus on
  2. Limited attention: Users are distracted and can’t focus on what matters
  3. Unclear next steps: Users simply don’t know what to do next

Your customers are survivors (and that’s the problem)

Here’s the mindset shift every founder needs: Your paying customers are survivors, not proof that your onboarding is perfect.

As Asia explains: “Just because you have customers doesn’t mean that your activation is amazing and perfect. Your customers are survivors and everyone else who does not become a customer was not a survivor, even if they were qualified.”

This is survivor bias in action. You’re looking at the people who made it through your confusing onboarding and assuming everything is fine, while ignoring all the qualified prospects who said “this is too hard” and left.

Product-Led vs. Sales-Led: Activation still matters

Product-Led Growth: Your product experience has to do the selling since there’s no salesperson walking users through it. The first touchpoint with your brand is likely your product itself.

Sales-Led: Even with manual onboarding, you still have an onboarding experience. When customers log in for the first time, what do they see? That impression impacts their perception of ease-of-use and their ability to activate successfully.

Whether you’re selling annual deals or monthly subscriptions, poor activation will show up in your churn metrics—it just might take longer to surface in sales-led models.

Avoiding “Compromise Land”

One of the biggest threats to successful activation improvements is what Asia calls “compromise land”—when your research-backed improvements get watered down by various team opinions.

The solution: Establish clear ownership of activation improvements and give that person or team the power to make decisions based on data, not politics. The more enterprise you go, the more likely you are to end up in compromise land, which leads to mediocre results and teams thinking “activation doesn’t work.”

Essential resources for mastering activation

Getting started: Your activation action plan

  1. Run the new user retention report to establish your baseline and discover high-impact behaviors
  2. Conduct 3-5 UX interviews with qualified prospects using missions, not instructions
  3. Map out every screen in your onboarding flow and identify friction points
  4. Prioritize improvements based on data, not opinions
  5. Establish clear ownership to avoid compromise land

Remember: Even small improvements in activation can have massive impacts on revenue. If your baseline retention is 5% and you can get it to 10%, that’s a 2x improvement that directly translates to more customers and revenue.

The bottom line

Activation isn’t magic—it’s a systematic process that can be figured out and improved. Your customers are survivors who fought through confusion and friction to find value. But imagine how many more customers you could have if you removed those barriers for everyone else.

The question isn’t whether you can afford to work on activation—it’s whether you can afford not to.

Ready to uncover the hidden revenue in your SaaS business? Book a free 45-minute growth audit with DemandMaven today and start turning more signups into satisfied, long-term customers.

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