In a Venture Capital world that is obsessed with growth, recurring revenue and software as a service, after you validate that you have a solution that people are willing to pay for, there is an entire new world ahead of you in scaling that venture. For many, this involves an entirely new language and set of metrics to manage the business. For the startup that wants to make the leap to scale up and fast growth this should serve as a starting point for key insights and metrics for that journey.
Describes the steps required to build a Sales and Marketing Machine that is predictable, scalable, automated, well instrumented, and cost efficient.
This was a presentation that I gave at the Lean Startup Circle in Boston on March 24th, 2011.
Slides David Shoenberger recently used in his discussion w/ mentees of The Product Mentor.
The Product Mentor is a program designed to pair Product Mentors and Mentees from around the World, across all industries, from start-up to enterprise, guided by the fundamental goals…Better Decisions. Better Products. Better Product People.
Throughout the program, each mentor leads a conversation in an area of their expertise that is live streamed and available to both mentee and the broader product community.
9 Steps to Repeatable, Scalable, & Profitable Growth - older version
In this slide deck, David Skok talks through his 9 step process for B2B startups to get through product/market fit, and to then find a repeatable, scalable, and profitable growth process.
In David's experience some of the most fatal and expensive mistakes founders make is trying to skip steps. Understanding this roadmap will save you countless hours and potentially millions of wasted dollars.
Launching a startup isn't easy. At each stage of scaling - from founding to product-market fit, from product-market fit to hyper growth, and from hyper growth to maturity - entrepreneurs face unique challenges. Greylock Partners hosted an event, called Greyscale, focused on these challenges at each stage. In the opening keynote, Jerry Chen of Greylock Partners discusses the state of enterprise software after the first quarter of 2016. He summarizes the private and public markets, M&A activity, and explains how this climate affects the startup environment.
Deep dive into Pricing Strategy. Learn the axes available to pull pricing lever for SaaS growth in subscription economy. Understand the influence ASP has on the options available and how to align it strategically across the 3 key SaaS sales model.
Latest Lean Analytics workshop from the Lean Startup Week in San Francisco. Focusing on what metrics matter to both startups and big corporations. Incorporates elements of corporate innovation into the Lean Analytics framework to help bigger companies think through the data that really matters.
David Skok and Stephanie Friedman host the Zero to 100 podcast focused on helping B2B startups find predictable, repeatable, and profitable growth. The podcast covers topics like building a repeatable sales process, funnel design, sales operations, and turning theory into practice. The event agenda includes sessions on founder-led selling, building a sales organization, forecasting, and the role of the CEO in scaling a business. Attendees can ask questions using the Sli.do question system.
The document provides an overview of key metrics, terms, and growth strategies for building a billion dollar SaaS unicorn company. It discusses 11 important SaaS metrics including MRR, ARR, CAC, LTV, NPS, churn, cohort analysis, and revenue per employee. It also outlines typical growth phases like the "T2D3" model of tripling revenue twice and doubling revenue three times to hit benchmarks like $2M, $6M, $18M, and $72M in ARR. Finally, the document emphasizes the importance of product-market fit and conducting customer interviews in the early "lean startup" phase.
The SaaS Founder’s Journey: What Matters at Each Stage
The document discusses the three phases of a SaaS startup's lifecycle: searching for product-market fit, scaling the business, and searching for a repeatable and profitable growth model. It emphasizes the importance of recognizing what phase a startup is in and taking the appropriate actions, such as not jumping ahead or expanding sales too quickly before completing the current phase. Cash conservation is also stressed until reaching the scaling phase. Aligning sales, marketing, and other functions is highlighted as important for predictable growth. The phases and lessons provided serve as a guide for SaaS founders to strategically navigate their company's development.
I gave this presentation about the Lean Analytics book at the Lean Startup Meetup in Karlsruhe.
Follow my blog for updates: http://jan-koenig.com/blog/
Or Twitter: https://twitter.com/einkoenig
Something important has changed in the recruiting process: the best people are almost never on the market, and you have to develop recruiting processes to find and sell passive candidates. In many cases, it will take months or years of relationship building with these candidates to find the right moment when they are open to considering a change. Closing them takes greater selling efforts than in the past due to the intense competition over the good candidates. This leads me to believe that there is now a third crucial startup skill that needs to be developed: recruiting.
Optimize Your Funnel By Getting Inside Your Buyer's Head
Part of finding product/market fit is turning early wins into repeatable, scalable, and profitable sales. In this talk given as part of the Heavybit speaker series, I discuss how to shorten the time to customer conversion from trials, freemium and open source products.
Outbound prospecting for highly targeted lead flow
This presentation described how and when outbound prospecting (Cold Calling 2.0) can work to provide a predictable flow of leads from highly targeted prospects.
There is a common problem where startups have an unbalanced business model with too high of customer acquisition costs compared to lifetime customer value. This document discusses the importance of having a well-balanced business model with consideration for cost to acquire customers, monetization and lifetime customer value. It also covers how the internet has shifted power to customers and changed buying behavior, requiring sellers to have an intimate understanding of customers to be successful.
Founding vs Professional CEO Performance Analysis in SaaS
This document summarizes an analysis of founding CEO versus professional CEO performance in the software as a service industry. It analyzes data from 48 SaaS companies that had exits from 1998-2009, comparing metrics like total investment, time to exit, and exit valuation between companies led by founding CEOs versus those led by professional CEOs hired later. It finds that companies led by founding CEOs generally had better performance on these metrics, even when accounting for biases. Possible reasons discussed include higher equity stakes and ownership mentality among founding CEOs.
The Ultimate How-To CRM Guide is the document that you need to make your decision between cloud-computing technology and on-premises. We call it "Ultimate" because it is the Ultimate How-To CRM Guide, the "Must-have" Guide :)
Oracle and cVidya Cloud webinar with the first part by Oracle covering SaaS market and opportunities in the cloud and Oracle's SaaS partnering strategy and second part by cVidya's covering cVidya's Journey into the Cloud with cVidyaCloud.
The document discusses key metrics and strategies for Software as a Service (SaaS) businesses. It outlines important metrics to track such as acquisition, activation, retention, churn rate, customer lifetime value, and cost of customer acquisition. Pricing strategies like freemium models are examined through case studies. Valuation approaches change from qualitative factors like team quality in early stages to quantitative metrics like revenue multiples in later stages. The presentation emphasizes the importance of measuring business performance, focusing on a single customer benefit, engaging with users, and providing excellent customer service.
This document analyzes valuation multiples and growth trends across different technology sectors including software as a service, marketplaces, consumer internet, and e-commerce from 1999-2015. It finds that while consumer internet multiples have remained steady in the past 5-10 years, SaaS valuations have increased 30-100% making it harder to generate high returns. Marketplace models command higher multiples than traditional e-commerce. Growth rates below 30% often lead to multiple compression. The document concludes that while valuations have increased, the sectors are not in a bubble and remain attractive compared to legacy sectors.
Sales Segmentation & Qualification for B2B SaaS Companies
This document provides guidance on selecting target customer segments and generating qualified leads for B2B SaaS companies. It emphasizes that most founders initially think their product can appeal to everyone, but targeting a specific segment is important. Selecting the right segment determines strategic choices. Generating leads requires inbound and outbound marketing to find potential customers experiencing problems the product solves. Qualifying leads confirms a fit between the product and customers' needs. The document offers tips on segmentation, marketing, sales approaches, and qualifying leads for the target segment.
Building a Repeatable, Scalable & Profitable Growth ProcessDavid Skok
The document discusses optimizing the sales funnel for SaaS startups. It emphasizes the importance of understanding the buyer's perspective and journey. The key points covered are:
1) The sales funnel should be designed around the buyer's process, not the vendor's solutions. It is important to understand buyer personas and map the funnel steps to their evaluation process.
2) Friction points in the funnel like long delays or steps requiring other people can drastically reduce conversion. These points should be identified and removed or simplified when possible.
3) The goal is to create a "wow moment" or motivation for the buyer to continue engaging as early as possible. This may require redesigning trial experiences to quickly
The document discusses buyer-centric funnel design. It emphasizes the importance of understanding where buyers are in their journey - awareness, consideration, or purchase. It recommends designing different experiences for each stage, with content that addresses buyer questions and concerns rather than just selling. The document also discusses identifying buyer personas, mapping their purchase process to the vendor's funnel, analyzing friction points, and optimizing the funnel based on buyer motivations and decision criteria. It provides examples from companies like Salsify and Apollo that redesigned their trials based on this approach, removing steps and addressing buyer pain points, which increased conversion rates.
Time to Wow! and Buyer-centric Funnel DesignDavid Skok
The document provides guidance on optimizing a company's sales funnel by taking a buyer-centric approach. It recommends mapping the buyer's decision process and addressing all their decision criteria and concerns at each step. Key strategies include removing friction points, adding motivators, and testing for problems through the lens of the buyer's experience. The goal is to design a funnel that delights buyers and keeps them motivated to continue engaging with the sales process.
Describes the steps required to build a Sales and Marketing Machine that is predictable, scalable, automated, well instrumented, and cost efficient.
This was a presentation that I gave at the Lean Startup Circle in Boston on March 24th, 2011.
Slides David Shoenberger recently used in his discussion w/ mentees of The Product Mentor.
The Product Mentor is a program designed to pair Product Mentors and Mentees from around the World, across all industries, from start-up to enterprise, guided by the fundamental goals…Better Decisions. Better Products. Better Product People.
Throughout the program, each mentor leads a conversation in an area of their expertise that is live streamed and available to both mentee and the broader product community.
In this slide deck, David Skok talks through his 9 step process for B2B startups to get through product/market fit, and to then find a repeatable, scalable, and profitable growth process.
In David's experience some of the most fatal and expensive mistakes founders make is trying to skip steps. Understanding this roadmap will save you countless hours and potentially millions of wasted dollars.
Launching a startup isn't easy. At each stage of scaling - from founding to product-market fit, from product-market fit to hyper growth, and from hyper growth to maturity - entrepreneurs face unique challenges. Greylock Partners hosted an event, called Greyscale, focused on these challenges at each stage. In the opening keynote, Jerry Chen of Greylock Partners discusses the state of enterprise software after the first quarter of 2016. He summarizes the private and public markets, M&A activity, and explains how this climate affects the startup environment.
Pricing - Setting up your startup for SaaS GrowthAnadi Raj Tiwari
Deep dive into Pricing Strategy. Learn the axes available to pull pricing lever for SaaS growth in subscription economy. Understand the influence ASP has on the options available and how to align it strategically across the 3 key SaaS sales model.
Lean Analytics for Startups and EnterprisesLean Analytics
Latest Lean Analytics workshop from the Lean Startup Week in San Francisco. Focusing on what metrics matter to both startups and big corporations. Incorporates elements of corporate innovation into the Lean Analytics framework to help bigger companies think through the data that really matters.
Zero to 100 - Part 1: Intro + First SectionDavid Skok
David Skok and Stephanie Friedman host the Zero to 100 podcast focused on helping B2B startups find predictable, repeatable, and profitable growth. The podcast covers topics like building a repeatable sales process, funnel design, sales operations, and turning theory into practice. The event agenda includes sessions on founder-led selling, building a sales organization, forecasting, and the role of the CEO in scaling a business. Attendees can ask questions using the Sli.do question system.
Building the Billion dollar SaaS Unicorn for 2018Kelly Schwedland
The document provides an overview of key metrics, terms, and growth strategies for building a billion dollar SaaS unicorn company. It discusses 11 important SaaS metrics including MRR, ARR, CAC, LTV, NPS, churn, cohort analysis, and revenue per employee. It also outlines typical growth phases like the "T2D3" model of tripling revenue twice and doubling revenue three times to hit benchmarks like $2M, $6M, $18M, and $72M in ARR. Finally, the document emphasizes the importance of product-market fit and conducting customer interviews in the early "lean startup" phase.
The SaaS Founder’s Journey: What Matters at Each StageDavid Skok
The document discusses the three phases of a SaaS startup's lifecycle: searching for product-market fit, scaling the business, and searching for a repeatable and profitable growth model. It emphasizes the importance of recognizing what phase a startup is in and taking the appropriate actions, such as not jumping ahead or expanding sales too quickly before completing the current phase. Cash conservation is also stressed until reaching the scaling phase. Aligning sales, marketing, and other functions is highlighted as important for predictable growth. The phases and lessons provided serve as a guide for SaaS founders to strategically navigate their company's development.
I gave this presentation about the Lean Analytics book at the Lean Startup Meetup in Karlsruhe.
Follow my blog for updates: http://jan-koenig.com/blog/
Or Twitter: https://twitter.com/einkoenig
How Startups Can Build a Recruiting MachineDavid Skok
Something important has changed in the recruiting process: the best people are almost never on the market, and you have to develop recruiting processes to find and sell passive candidates. In many cases, it will take months or years of relationship building with these candidates to find the right moment when they are open to considering a change. Closing them takes greater selling efforts than in the past due to the intense competition over the good candidates. This leads me to believe that there is now a third crucial startup skill that needs to be developed: recruiting.
Optimize Your Funnel By Getting Inside Your Buyer's HeadDavid Skok
Part of finding product/market fit is turning early wins into repeatable, scalable, and profitable sales. In this talk given as part of the Heavybit speaker series, I discuss how to shorten the time to customer conversion from trials, freemium and open source products.
Outbound prospecting for highly targeted lead flowDavid Skok
This presentation described how and when outbound prospecting (Cold Calling 2.0) can work to provide a predictable flow of leads from highly targeted prospects.
There is a common problem where startups have an unbalanced business model with too high of customer acquisition costs compared to lifetime customer value. This document discusses the importance of having a well-balanced business model with consideration for cost to acquire customers, monetization and lifetime customer value. It also covers how the internet has shifted power to customers and changed buying behavior, requiring sellers to have an intimate understanding of customers to be successful.
Founding vs Professional CEO Performance Analysis in SaaSYujin Chung
This document summarizes an analysis of founding CEO versus professional CEO performance in the software as a service industry. It analyzes data from 48 SaaS companies that had exits from 1998-2009, comparing metrics like total investment, time to exit, and exit valuation between companies led by founding CEOs versus those led by professional CEOs hired later. It finds that companies led by founding CEOs generally had better performance on these metrics, even when accounting for biases. Possible reasons discussed include higher equity stakes and ownership mentality among founding CEOs.
The Ultimate How-To CRM Guide is the document that you need to make your decision between cloud-computing technology and on-premises. We call it "Ultimate" because it is the Ultimate How-To CRM Guide, the "Must-have" Guide :)
Oracle and cVidya Cloud webinar with the first part by Oracle covering SaaS market and opportunities in the cloud and Oracle's SaaS partnering strategy and second part by cVidya's covering cVidya's Journey into the Cloud with cVidyaCloud.
The document discusses key metrics and strategies for Software as a Service (SaaS) businesses. It outlines important metrics to track such as acquisition, activation, retention, churn rate, customer lifetime value, and cost of customer acquisition. Pricing strategies like freemium models are examined through case studies. Valuation approaches change from qualitative factors like team quality in early stages to quantitative metrics like revenue multiples in later stages. The presentation emphasizes the importance of measuring business performance, focusing on a single customer benefit, engaging with users, and providing excellent customer service.
Valuations: What is happening and does it matter?taliagold
This document analyzes valuation multiples and growth trends across different technology sectors including software as a service, marketplaces, consumer internet, and e-commerce from 1999-2015. It finds that while consumer internet multiples have remained steady in the past 5-10 years, SaaS valuations have increased 30-100% making it harder to generate high returns. Marketplace models command higher multiples than traditional e-commerce. Growth rates below 30% often lead to multiple compression. The document concludes that while valuations have increased, the sectors are not in a bubble and remain attractive compared to legacy sectors.
Sales Segmentation & Qualification for B2B SaaS CompaniesGuillaume Lerouge
This document provides guidance on selecting target customer segments and generating qualified leads for B2B SaaS companies. It emphasizes that most founders initially think their product can appeal to everyone, but targeting a specific segment is important. Selecting the right segment determines strategic choices. Generating leads requires inbound and outbound marketing to find potential customers experiencing problems the product solves. Qualifying leads confirms a fit between the product and customers' needs. The document offers tips on segmentation, marketing, sales approaches, and qualifying leads for the target segment.
SaaS companies should optimize the purchasing process by reducing barriers, simplifying decisions, and introducing low-cost options. They should focus initial sales on easy entry points like free versions and then proactively upsell customers on additional features, options, and packages through automated monitoring and recommendations.
The Ultimate Guide To Startup Sales Tools (2015)Nic Poulos
Second edition of our Startup Sales Tool Guide! Bowery Capital is a VC based in NYC & SF investing in early-stage business software startups. We accelerate our portfolio companies' growth by focusing squarely on support around early customer acquisition. We've helped many B2B startups build & scale sales teams and know that sometimes you need the right tools to win. So we thought it would be helpful to aggregate some of our team's & founders' learnings around early-stage sales tools that work. We hope startups will find this resulting guide to be helpful and encourage everyone to reach out via Twitter, LinkedIn or email with any feedback so we can update & improve it over time!
The Huge List of 127 Marketing Tools (+11 Bonus Sales Tools!)TrackMaven
In search of new tools to optimize your marketing mix? We've compiled a huge list of 127 marketing tools (plus 11 bonus sales tools!) to help make you a more productive marketer.
Browse through this SlideShare, complete with screenshots and brief descriptions of all of the tools. Or, if you know you're looking for, skip straight to that category!
The tools are broken down by Marketing Automation, SEO, Social, Curation, Research, Content, Organization, Visuals. Collaboration, Technical, Data and Interactions, Email, Productivity, and our bonus category, Sales.
Latest edition of the Silverpeak Benchmark report - Application Software Sector, a review of key company valuation metrics in the US, UK and European application software sectors. By reviewing sector median averages, our aim is to provide a set of software industry benchmarks against which individual company performance can be measured.
Lean Startup Basics - Evidence Based EntrepreneurshipKelly Schwedland
Introduction and overview to the lean process for startups. An evidence based approach to validate early hypothesis and develop a solid Business Model before launch. Involving Customer Development, Hypothesis testing, Minimum Viable Product, (MVP) to get to Product/ Market fit and ultimately A replicable scalable business model. This simple but disciplined approach takes the guess work out of taking an idea and turning it into a viable company.
Based on Eric Reis, Steve Blank and Alex Osterwald's work with Lean Startup, Lean launchpad, customer development and Business Model Canvas. Now in practice by multiple Incubators, Accelerators, Universities and now the National Science Foundation through ICorp to validate business ideas with before investing.
A SaaS Metric designed to Increase Free Trial ConversionsLincoln Murphy
CCAs & Engagement – An Uncommon Way to Engage & Convert Prospects in Your SaaS Free Trial.
A few years ago I came up with a set of metrics that I called Common Conversion Activities – or CCA – that I defined as “The things that all or most paying customers do during their trial.”
In July 2012 I gave a 54-minute presentation where I introduced the next version of this ever-evolving set of metrics for measuring Free Trial success, the CCA, and I want to share that with you now.
See the video of this presentation here: http://sixteenventures.com/free-trial-metrics
How to Drive Growth with Customer Success MetricsGainsight
The most successful Enterprise SaaS companies know that growing revenue only through new customer acquisition is the less efficient way to scale. Rather, they understand that growing revenue within your existing customer base - through up-sells, cross-sells, and expanded use - is the most profitable way to scale.
In fact, Enterprise SaaS companies that grow revenue - and company valuation - by expanding revenue within their existing customer base also know the key to making this work is to focus on - and operationalize - Customer Success.
This presentation - How to Drive Growth with Customer Success Metrics - is from Pulse 2014, the biggest Customer Success industry event ever and included panelists Aaron Ross, author of Predictable Revenue, Jason Lemkin of Storm Ventures, Tomasz Tunguz of Redpoint Ventures, and Brian Stafford McKinsey.
SaaS Marketing Plan: 5 Ways to Get your B2B App to Sell ItselfLincoln Murphy
Your B2B SaaS app will not sell itself unless it is designed to do so. This is a guide to getting your B2B SaaS to 'sell itself' was created by noted SaaS Marketing expert and Growth Hacker Lincoln Murphy of Sixteen Ventures.
This guide is full of actionable, unique, and thought-provoking ideas - Growth Hacks if you will - that are designed to allow your product to sell itself.
From attracting the right audience and driving user engagement, to making it easy to buy and easy to share through orchestrated virality, this guide covers all aspects of what's necessary to drive growth with SaaS companies of any stage and serving any market.
Whether you have a self-service sales model or one that requires outside sales reps to drive business, the tips and techniques contained in this guide and the source blog post will help you achieve your goals of efficiently scaling your sales process.
Key Metrics for Product-led SaaS with Unusual Venturessaastr
This document discusses metrics that are important for product-led growth (PLG) companies, as these companies grow differently than traditional sales-driven companies. It outlines five key metrics: 1) organic user growth, 2) product adoption through engagement and retention, 3) free-to-paid conversion, 4) number of product-qualified accounts, and 5) cohorted net dollar retention. For each metric, it provides benchmarks for top-performing companies and tactics to achieve those benchmarks. Overall, the document advocates that PLG companies should measure metrics that focus on product usage and self-serve motions rather than traditional sales metrics like sales cycle and quota attainment.
Understanding what metrics are relevant to your startup, and why, can be a daunting task. In this meetup we will discuss what metrics matter for a SaaS company or project. What investors are looking for in the metrics you track and why do they think they are important. What is CAC and LTC, why is CHURN critical? We will also review how to calculate these important metrics, what equations will give you the right answer, and what tools make sense to use for your business.
Presenter: Lecole Cole, Founder & CEO, Skydera
Mastermind Masterclass: The Most Common SaaS Sales Potholes and How to Avoid ...saastr
The document discusses common growth potholes that companies encounter and how to avoid them. It identifies six main potholes: 1) low license utilization rates causing revenue contraction, 2) increasing price without a sustainable moat, 3) confusing a temporary moat with a sustainable one, 4) promoting the best salesperson to manager, 5) prioritizing revenue acquisition over customer value creation, and 6) massive hiring of salespeople after a financing round. For each pothole, it provides examples and recommendations for how to address the issues and maintain steady growth.
Eric Santos - Revenue plays to preserve MRR, gain efficiency and build a pipe...SaaStock
This document outlines strategies for SaaS companies to preserve revenue, gain efficiency, and build a pipeline for future growth during the COVID-19 crisis. It recommends gathering customer intelligence to refine positioning, preserving monthly recurring revenue through proactive engagement and empathy, accelerating sales through segmentation and adjusted processes, gaining efficiency through business model optimization and potential M&A, and creating a pipeline for future revenue through low-cost entry points and expanded adoption. It also stresses the importance of transparency, empathy, and careful management of people during this challenging time.
Discover and understand the critical actions needed on the venture journey to scale successfully.
What is it for?
To help corporate entrepreneurs identify and successfully navigate each critical action that will ultimately become the foundation of a corporate venture’s scaling effort. Based on the insights from 200+ corporate innovation and venture tracks, this practical guide provides a deeper understanding of what’s needed early-on for long-term venture growth.
Benefits:
Identify the right measurement approach that shines a light on your path forward.
Create an ideal team setup with access to the right talent at the right time.
Select the appropriate ownership structure and legal entity format.
Watch This Free Webinar On-Demand: http://dg-r.co/2fuk0LO - Maximize Customer Lifetime Value In 2017 by Leveraging Your 2016 Wins
Learn why Customer Lifetime Value is a critical metric that can improve your ABM plan & shape your 2017 budget
You worked hard in 2016 to target and convert the accounts and prospects with the highest propensity to buy. Now you need to keep those new customers happy while continuing to expand those relationships. Join Matt Zelen, SVP of Customer Success at Act-On Software, and learn how you can maximize your customer lifetime value in 2017, including:
• Why customer lifetime value is a vital strategic metric for your business;
• How both customer lifetime value and customer acquisition can help determine marketing budget in 2017;
• Tips and tricks to creating a long-term, strategic approach to defining customer lifetime value; and
• How CLV positively impacts account-based marketing initiatives.
SaaS/subscription businesses are much more complex than traditional businesses, and SaaS performance cannot be measured in the same way as traditional businesses are measured. Based on a talk given at the SaaStr Annual Conference in San Francisco, this slide deck offers a comprehensive and detailed look at the key metrics that are needed to understand and optimize a SaaS business, and how these can be used to drive SaaS success. This presentation includes information on:
- An intro to SaaS metrics
- Unit economics
- LTV and churn: An in-depth look
- Variable pricing axes
- Months to recover CAC
- The primary unit of growth: Sales
- Understanding public SaaS companies
This document provides an overview of Intuit's strategy and addressable market opportunities. It discusses Intuit's transition to cloud-based products which is accelerating category adoption. Intuit's customer base grew 14% YoY to over 5 million customers. The strategy is to grow the core products and markets, connect the ecosystem through offerings like e-invoicing and lending, and expand globally by proving the model in countries like Canada, UK, and Australia which now have over 100k subscribers each. This pursues a total addressable market of $145 billion.
Decoding the KPI Kaleidoscope with Sandfox Advisorssaastr
Metrics are important to investors because they provide visibility into a SaaS company's revenue growth, sales efficiency, and customer retention. Key metrics include monthly recurring revenue/annual recurring revenue to measure topline growth, revenue churn to understand customer retention, and customer acquisition cost and lifetime value to assess the efficiency and profitability of the growth strategy. Maintaining high growth, strong sales efficiency through a favorable magic number ratio above 1, and low revenue churn are positive signs for investors.
With this study, we distill and prescribe characteristics, practices and best-in-class methods associated with "fast growers,“ which we define as companies with GAAP revenue growth rates of 30% or higher. As discovered in previous years and validated again this year, the central driving force for fast growers is the appropriate, aligned go-to-market model executed with excellence and coupled with financial discipline and investment.
Use this report to compare your business to like companies in the Edison portfolio, as well as industry guidance. These benchmarks and advice will enable you to map your own plan and journey to becoming a fast grower, or accelerate even faster to a $100M company.
This document provides an overview and resources related to venture capital topics. It begins with an introduction and table of contents. Then it covers the following sections in detail: Sourcing & Due Diligence, Product-Market Fit, KPIs and Unit Economics, Market Sizing, Valuation, Term Sheets & Financing, VC Exits, and Fund Operations. For each section, it provides a high-level summary and lists relevant article and podcast resources for further learning. The goal of the Harlem Capital Syllabus is to synthesize common VC topics and share helpful resources for those seeking to learn more about venture capital.
The document provides guidance on tasks for building and scaling a venture from an expert in company building. It outlines key steps and considerations for launching a venture including finalizing the company name, analyzing customer engagement data to identify opportunities to pivot the product, optimizing the sales funnel based on conversion rates, securing external investment, and optimizing the customer acquisition cost versus lifetime value. The tasks are organized into stages of setup, launch, and scale and include metrics to track and benchmarks for success.
This document discusses the transformation of marketing roles to focus on revenue generation. It notes that roughly 50% of B2B marketers now have direct revenue accountability. Marketers are engaging prospects earlier in the buying process and staying involved through sales and after. As their role changes, marketers need new metrics to demonstrate business impact, moving from measuring activities to measuring revenue results. The document provides examples of key revenue metrics and outlines challenges in accurately calculating marketing ROI across the entire customer lifecycle. It emphasizes the importance of alignment between marketing, sales, finance, and IT to define common definitions, processes, and key performance indicators tied to revenue.
In this prescriptive breakout session learn what successful Solution Providers are doing to build their Cloud/Mobility business. This workshop is designed for Solution Provider new to cloud/mobility marketplace or have not yet seen success. Success in the new marketplace starts with a Practice Statement, entails new ideas on building marketing savvy and better sales execution. We will cover a variety of tools, tips and techniques partners are using to drive Cloud /Mobility success.
Topics:
• Why you need to create a Practice Statement
• Aligning your marketing message to fit your Cloud strategy
• Building your Cloud marketing program that is unique and is active
• Creating a sales mentality and compensation program that works
• Developing a Business Guidance sales mentality
http://www.ingrammicrocloud.com
Bootstrap, Angel or Venture: Determining the Right Financing Strategy for You...Judy Loehr
This presentation was shared at Dreamforce 2016 to help early-stage cloud business application startup teams understand how investors will evaluate their markets so they can plan the right financing strategy from the beginning.
After the markets pounded SaaS early this year, CEOs started gearing up for a downturn. Your company may already be tightening its belt. But that might not be enough. Gainsight CEO Nick Mehta, InsightSquared CEO Fred Shilmover, and Bessemer Venture Capital partner Byron Deeter are teaming up for an all-star webinar to outfit you with a plan for the downturn. They'll discuss:
The timeline for the SaaS "reset"
Optimizing customer acquisition
Investing in lean revenue
And much, much more
Similar to Building the Billion Dollar SaaS Unicorn: CEO Guide (20)
Explore the rapid development journey of TryBoxLang, completed in just 48 hours. This session delves into the innovative process behind creating TryBoxLang, a platform designed to showcase the capabilities of BoxLang by Ortus Solutions. Discover the challenges, strategies, and outcomes of this accelerated development effort, highlighting how TryBoxLang provides a practical introduction to BoxLang's features and benefits.
Software development... for all? (keynote at ICSOFT'2024)miso_uam
Our world runs on software. It governs all major aspects of our life. It is an enabler for research and innovation, and is critical for business competitivity. Traditional software engineering techniques have achieved high effectiveness, but still may fall short on delivering software at the accelerated pace and with the increasing quality that future scenarios will require.
To attack this issue, some software paradigms raise the automation of software development via higher levels of abstraction through domain-specific languages (e.g., in model-driven engineering) and empowering non-professional developers with the possibility to build their own software (e.g., in low-code development approaches). In a software-demanding world, this is an attractive possibility, and perhaps -- paraphrasing Andy Warhol -- "in the future, everyone will be a developer for 15 minutes". However, to make this possible, methods are required to tweak languages to their context of use (crucial given the diversity of backgrounds and purposes), and the assistance to developers throughout the development process (especially critical for non-professionals).
In this keynote talk at ICSOFT'2024 I presented enabling techniques for this vision, supporting the creation of families of domain-specific languages, their adaptation to the usage context; and the augmentation of low-code environments with assistants and recommender systems to guide developers (professional or not) in the development process.
Sami provided a beginner-friendly introduction to Amazon Web Services (AWS), covering essential terms, products, and services for cloud deployment. Participants explored AWS' latest Gen AI offerings, making it accessible for those starting their cloud journey or integrating AI into coding practices.
Break data silos with real-time connectivity using Confluent Cloud Connectorsconfluent
Connectors integrate Apache Kafka® with external data systems, enabling you to move away from a brittle spaghetti architecture to one that is more streamlined, secure, and future-proof. However, if your team still spends multiple dev cycles building and managing connectors using just open source Kafka Connect, it’s time to consider a faster and cost-effective alternative.
What is OCR Technology and How to Extract Text from Any Image for FreeTwisterTools
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3. Why a $Billion? – It’s Investable
* Each investor has their own
investment thesis, certain
products, markets or business
models that they prefer. Look
for a good match to your
product offering and market
validation
Typical Investor Interests:
• $1B+ Market
• Scalable Solution
• Recurring Revenue
• Past Successes
• Full team
• Traction
4. Growth Stage Key Points
I. Terms & Metrics
II. Roadmap
III. Sustaining Growth
5. I. Key Terms & Metrics for SaaS
1. Cash flow
2. MRR/ARR
3. CAC & LTV
4. ACV
5. Churn
6. Cohort analysis
7. LVR
8. TtV
If you only read one article on SaaS metrics this would be the one:
http://www.forentrepreneurs.com/saas-metrics-2/
For Developing a KPI dashboard for a SaaS company:
http://christophjanz.blogspot.de/2013/04/a-kpi-dashboard-for-early-stage-saas.html
7. 2. MRR & ARR
• The First $1M ARR Goal – 6 months
• Simple Math:
– $1M ARR = $83K MRR
– $83K/ $1000/mo. ACV = 83 customers
– 83/6 mo. = ~ 14 new customers per month
(or one new customer every 2 days, simple!)
http://sixteenventures.com/saas-secret-to-one-million-dollars
MRR = Monthly Recurring Revenue
ARR = Annual Run Rate (MRR x 12)
8. LTV > 3x CAC
Months to recover CAC < 12 Months
3. CAC & LTV: Viability Test
Business model viability, in the majority of startups, will come down to balancing
two variables:
• CAC: Cost to Acquire Customers
• LTV: Lifetime Value of a Customer or The ability to monetize those customers
http://www.forentrepreneurs.com/startup-killer/
9. 4. Matching CAC, LTV & ACV
• Product Pricing, Sales Strategy and Product
are all interconnected.
http://vcwithme.co/2015/03/30/optimizing-the-ltvcac-ratio/
http://pando.com/2013/06/15/what-the-data-reveals-about-how-to-make-SaaS-secret-sauce/
Average SaaS Companies Well marketed, easy to use
and easy to implement
ACV= Average Contract Value
VS.
10. 5. Churn = # MRR this month /
# MRR lost from last month
http://www.slideshare.net/03133938319/saastr
Big impact on
value over
time
What’s good, what’s bad
‣ What you want
‣ Get to $1M ARR
~12 months after launch
‣ Net New MRR keeps
increasing quarter over quarter
‣ Maintain a Churn Ratio > 4
‣ What to watch out for
‣ A Churn Ratio < 2 – churn is
too high /new sales aren’t
working
‣ Net New MRR is flat or down
quarter over quarter
‣ As a result takes 18+ months
to get to $1M ARR
11. 6. Cohort Analysis
• With a SaaS business there is a simple way to
understand Customer Retention/ Churn through
multiple product iterations.
http://andrewchen.co/the-easiest-spreadsheet-for-churn-mrr-and-cohort-analysis-guest-post/
12. 7. LVR - Lead Velocity Rate
• Qualified Lead Velocity Rate (LVR), your
growth in qualified leads, measured month-
over-month, every month.
• Grow your LVR about 10-20% greater than
your desired MRR growth — you’ll hit your
revenue goals.
• You’ll see the future of your business 12-18
months out, clear as can be.
http://www.saastr.com/why-lead-velocity-rate-lvr-is-the-most-important-metric-in-saas/
13. 8. TtV- Time to Value
• How fast can a customer derive value from
your product?
• Ways to Improve:
– Simplicity wins…
be feature-complete, not feature-rich
– Hack the onboarding flow
– Document, Document, Document
– Quantify, Set goals and Benchmark
http://www.rre.com/blog/89
15. 5 ways to build a $B business
http://christophjanz.blogspot.com/2014/10/five-ways-to-build-100-million-business.html
http://tomtunguz.com/2015-saas-multiples/
In SaaS to get a Billion Dollar valuation you
need somewhere over $100M in Annual
Revenue.
You essentially need:
~ 1,000 enterprise customers at $100k+ /Yr or
~ 10,000 medium-sized at $10k+ /yr or
~ 100,000 small businesses at $1k/yr or
~ 1 million consumers at $100+ /yr each or
~ 10 million active consumers who you
monetize at $10+ per year each by selling ads
Examples: 2014 Rev Valuation*
HUBS $115M $1.3B
ZEN $127M $1.9B
MKTO $149M $1.1B
*Also dependent on growth rate and Cost of Revenue. Avg 5-10 x Rev multiples
17. T2D3 Cont’d
• Phase 1: Establish a great product-market fit
• Phase 2: Get to $2 million in ARR (annual
recurring revenue)
• Phase 3: Triple to $6 million in ARR
• Phase 4: Triple to $18 million
• Phase 5: Double to $36 million in ARR
• Phase 6: Double to $72 million
• Phase 7: Double to $144 million
http://techcrunch.com/2015/02/01/the-saas-travel-adventure/
18. Phase 0: Lean Startup Process
http://www.slideshare.net/KellySchwedland/lean-startup-basics-evidence-based-entrepreneurship
Also: The 20 Interview rule
http://www.saastr.com/planning-to-do-a-saas-start-up-dont-forget-the-20-interview-rule/
Note: If you are still starting out, then you need this presentation:
19. Phase 1: Product/Market/ (Team) Fit
• The Simple definition – When your problems
shift to keeping up with demand rather than
finding more customers.
• The only thing that matters: Market
• Warning signs you aren’t there:
• Product Market Fit Myths
http://pmarchive.com/guide_to_startups_part4.html
http://vcwithme.co/2014/11/10/five-signs-your-product-market-fit-isnt-real/
http://www.feld.com/archives/2015/01/illusion-product-market-fit-saas-companies.html
20. Building a replicable model*
http://www.slideshare.net/KellySchwedland/generic-system-strategy-flow-chart
*Documenting the
systems throughout the
business so that they can
be replicated by the next
hire.
Example of a system strategy flow chart
21. Focus: Marketing, Sales, Revenue
http://www.bvp.com/blog/new-whitepaper-released-%E2%80%9C30-qa-every-saas-revenue-leader-needs-know%E2%80%9D
“30 Answers that Every SaaS Revenue Leader Needs to Know”
23. Median GP Ratio by year
for Public SaaS companies
How fast?
• Rule of thumb – Growth Rate +Profit Margin
should equal 40%... for a $50M business
• Early on it should
probably be
higher.
http://tomtunguz.com/rule-of-40
24. Accelerating Customer Acquisition and
Retention
• Remove Buyer Roadblocks:
– Increase Awareness
– Facilitate Evaluation
– Streamline Purchase
– Simplify Onboarding
• Improve Retention
– Remind Customers of Value they are getting
– Triggered up-selling and cross-selling that
expanded usage of your service (and revenue)
http://chaotic-flow.com/SaaS-marketing-accelerating-customer-acquisition/
http://sixteenventures.com/customer-retention-profitability
25. Improving Lead to Conversion Ratio
• Measure and optimize each conversion
channel.
http://blogs.salesforce.com/company/2014/11/b2b-sales-benchmark-research-finds-some-pipeline-surprises-infographic-gp.html
B2B Sales Benchmark Research by Implisit using Salesforce data
26. Polynomial Growth By Alex Moor, CEO of
Baydin
Overcoming the Growth Challenge
http://www.slideshare.net/500startups/alex-moore-25097027
Polynomial Growth: The Additive Value of new Sales Channels
27. Median revenue per Employee by
year since founding
Two development tracks one goal
• Efficiency and Product Value always seem to
be competing for internal talent.
• But they are flip
sides to the same
productivity coin.
http://tomtunguz.com/employee-productivity-patterns-saas/
Note: Best in class companies
like Salesforce and
FinancialEngines are able to
achieve more than $300k in
revenue per employee per year
28. Benchmarking
• How Does your SaaS business stack up?
– Pacific Crest SaaS survey data (2014)
http://www.forentrepreneurs.com/2014-saas-survey-
1/
– Sales Reps http://blog.bridgegroupinc.com/sales-
development-metrics
– Customer success
http://blog.totango.com/2014/05/2014-customer-
success-salary-survey-report-and-infographic/
Tom Tunguz noted Blogger and VC With firm Redpoint noted in a recent vLog that copying a business model is typically not a good idea since they have diminishing value over time as more folks copy.
That said it is increasingly important to understand what the business models of successful companies look like as a sanity check for the numbers that you are seeing and projecting.
One of the top Questions asked by Investors.What problem do you solve and how big an opportunity (market) is that? Generally investors are interested in opportunities that have a $B+ market potential and growing.
Since SaaS companies are recurring revenue generally with high operating margins a Billion Dollar valuation requires $100M+ in annual recurring revenues
(Whether your product or team can get there are two other biggies.)
For those that are on there first time building a SaaS business with institutional investor backing here are some of the key terms you are going to need to learn and track.
While this seems the most obvious. Running out of money is the end of any startup or scale up.
So needless to say this is the the most import number to keep track of.
Understanding the rate of your growth and being able to predict the cash burn effectively is of paramount importance while scaling.
Understanding which segment of the market you are going after is helpful vital in determining your strategy for building the company
(Ie if you are going after a Million consumers at $100/yr then you probably can’t afford a direct sales approach.
In fact, You probably can’t even afford an advertising approach as Dropbox found in tests advertising cost them $287 per paid $100 user.
So the incentivized/ viral strategy became necessary.)
Neeraj Agrawal at Battery Ventures was nice enough to share some insights from several of their SaaS investments.
Starting from the $2M ARR several seemed to follow a very similar path.
While it is possible to arrive at $100M ARR from a variety of paths having guideposts to shoot for is a very helpful tool.
A Quick look at how the path breaks down.
Without taking up too much time, use a lean Launchpad approach combined with Agile development to get to viable product
( There is an entire other deck on that process)
At a minimum use the 20 interview Rule before writing the first line of code.
Product market fit is the hardest thing to capture since there doesn’t seem to be any consensus on what it will truly mean for your company.
From my experience, in hindsight, it was probably when our focus shifted to internal scaling issues rather than the question of how how do we find customers.
Certainly there are a myriad of issues that need to be hashed out but this seems to be a relatively easy identification point.
Mark Andreesen has a very simple approach that the only thing that matters is the Market
In a great market -- a market with lots of real potential customers -- the market pulls product out of the startup.
~Rachleff’s Corollary of Startup Success, named after Andy Rachleff formerly of Benchmark Capital
And you can always feel product/market fit when it's happening. The customers are buying the product just as fast as you can make it -- or usage is growing just as fast as you can add more servers. Money from customers is piling up in your company checking account. You're hiring sales and customer support staff as fast as you can….
Warning signs you aren’t there:
You have ten to twenty customers… …and have for a while
Founders sold the product but the sales people you’ve hired can’t figure it out
Services are > 25% of your revenue
You can’t get access to senior deciders
Your first round of renewals goes horribly wrong
Myth’s on Product Market Fit
Myth #1: Product market fit is always a discrete, big bang event
Myth #2: It’s patently obvious when you have product market fit
Myth #3: Once you achieve product market fit, you can’t lose it.
Myth #4: Once you have product-market fit, you don’t have to sweat the competition.
Working with growing companies years ago I found that the first inhibiter to growth was that the founder/ owners had everything in their
head.
Replication requires that it be transferable to other individuals.
The diagram is designed to be a thought exercise in thinking through the processes inside the company and then documenting and releasing to others to use and then build on/ modify.
I’ve found that focusing on the results/ metrics of the process helps allow for improvements to the process.
While having an overall system strategy is important, In order to scale sales and customer success becomes one of the critical processes.
Fortunately Bessemer was nice enough to give us 30 key questions that we need to be able to answer to own growth.
Investors aren’t at all excited about linear growth companies and everyone want to see the exponential hockey stick growth.
In reality very few B2B companies scale exponentially. Which is why it’s important to understand that during the growth process there are several levers that may need to be added to sustain growth.
Alex Moore, CEO of Baydin, lays out the case that most true scaling companies that are investor darlings actually have a series of additive elements.
That as they are applied create a Pseudo exponential growth curve that he calls Polynomial.