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I've been working with several private equity firms lately, helping their portfolio companies clarify their messaging. What I keep hearing in strategy sessions is not “let’s improve our copy or fix our CRO” anymore.

It's a big shift in how these companies need to position themselves.

The trigger? Something called the Rule of 40.

If you're not familiar, the Rule of 40 is a simple financial benchmark that's become gospel in SaaS. Take your annual revenue growth rate and add your profit margin. If the sum hits 40% or higher, you're in good shape.

So a company growing 30% annually with 15% profit margins scores 45% would be solid. A company growing 50% while losing 10% hits 40%, acceptable. A company growing 60% while burning 25% scores 35%, problematic.

The math isn't complicated. But the implications run deep.

Why this matters beyond spreadsheets

History lesson time.

For most of the 2010s, SaaS companies lived by one rule: grow fast, figure out profits later. Venture capital was cheap. Markets were hungry for scale. "Blitzscaling" was a strategy, not a cautionary tale.

Companies burned millions to acquire customers, expand into new markets, and build massive teams. Boards celebrated triple-digit growth rates even when unit economics looked shaky. The assumption was simple: if you could grow fast enough, profitability would eventually follow.

Then 2022 happened. Interest rates climbed. Capital markets tightened. Suddenly, investors started asking different questions. Not just "how big can you get?" but "how efficiently can you get there?"

The Rule of 40 became the new north star because it balanced both sides of the equation.

Growth matters, but so does sustainability.

What I'm seeing in messaging

Working with PE-backed SaaS companies has given me a front-row seat to this transition. These are strategic pivots happening in real time.

I recently worked with a portfolio company on repositioning their platform. The leadership team was convinced their differentiation came from their AI capabilities and automation features, the typical tech-forward positioning you'd expect.

But when we dug into their customer data and interviewed their most profitable accounts, a different story emerged. Their best customers weren't choosing them for the AI. They were choosing them because the platform helped them consolidate three separate tools, reduce operational overhead, and improve team coordination.

The features they thought were differentiators, were actually table stakes. What actually drove profitable growth was operational efficiency, or helping customers do more with less.

This realization forced a complete repositioning. Instead of leading with AI and automation, we repositioned around operational consolidation and measurable efficiency gains. The new messaging spoke directly to Rule of 40 pressures: helping customers grow smarter, not just faster.

To get to that point, we needed to understand what actually created sustainable value for both the company and its customers.

The ripple effect across buyer psychology

Here's what makes this shift so important for messaging: your buyers are going through the same transformation.

The CMO evaluating your platform? She's under pressure to prove marketing ROI, not just generate leads. Her budget is tighter. Her metrics are more sophisticated. Her board is asking harder questions about every dollar spent.

The founder considering your solution? He's moved from "how can we scale fastest?" to "how can we scale smartest?" He's thinking about runway, unit economics, and sustainable competitive advantages.

The head of growth? She's optimizing for efficiency over velocity. The days of throwing budget at every experiment are over. She needs tools that demonstrate clear value, not just exciting possibilities.

When your entire audience is operating under Rule of 40 thinking, balancing growth with profitability, your messaging needs to reflect that reality.

How messaging must evolve

Context is everything.

In the growth-at-all-costs era, effective messaging emphasized scale potential, market disruption, and unlimited possibilities. Those weren't wrong messages, they simply matched the buyer's mindset.

But Rule of 40 thinking requires a different approach. Your audience is optimizing for sustainable value creation, not just rapid expansion.

This shows up in subtle but important ways:

• Instead of leading with total addressable market size, lead with problem-solution fit and measurable outcomes.
• Instead of emphasizing "revolutionary" change, emphasize intelligent optimization and compound improvements.
• Instead of promising unlimited scale, demonstrate how scale becomes sustainable and profitable.

The deeper lesson

The Rule of 40 represents something bigger than a financial metric. It's a mental model that balances ambition with sustainability.

Great messaging has always been contextual, it reflects not just what you do, but the world your audience operates in. Their constraints. Their pressures. Their definition of success.

When the market celebrated blitzscaling, messaging about speed and disruption felt authentic. When the market started rewarding discipline and efficiency, those same messages began to feel tone-deaf.

Your messaging strategy should evolve with your audience's evolving reality.

Your positioning should reflect this shift, too

When your market is thinking Rule of 40, your message should demonstrate that you understand the game they're actually playing.

The Rule of 40 is teaching SaaS companies that sustainable growth requires balancing expansion with profitability. The messaging lesson is similar: sustainable positioning requires balancing ambition with operational reality.

Your audience isn't just buying your product. They're buying your understanding of the world they operate in.

Make sure your message reflects it.

DISCOVERY

🎙️ New podcast: AI won’t fix your copy, until you fix your positioning.

In this episode, I sat down with Mikael Dia on the Funnel Vision Show to unpack the truth behind AI and B2B copywriting.

We talked:

• Why most AI-generated copy falls flat (and how to fix it)
• The real order of operations: Positioning → Messaging → Writing
• How to use Claude to structure better writing projects—not just generate words
• The future of conversion copywriting (hint: it's not prompt engineering)

If you want practical insight on using AI without skipping the strategy, this one's for you.

​

RESONANCE

Ryan Holiday, Discipline Is Destiny

Have a great weekend!

Cheers,

Chris

Chris Silvestri Founder & conversion alchemist

🙌🏻 Let’s be friends (unless you’re a stalker)​

When you're ready, here's a few ways I can help

Not sure where to start? Take our free message-market fit scorecard.​