SaaStr

DECEMBER 4, 2023

Use this knowledge across the whole process to refer to constantly and drive urgency. It could be price, product composition, or payment terms. If you want to cut the sales cycle, always do an exchange of urgency, i.e., “I’ll accept flexible payment terms, but we need to close this week.” #2: to find out what was going on.

SaaS Payments 208

SaaS Payments Payment Services Payments Payment Features 208

SaaStr

MARCH 15, 2024

Last week, they launched a product called Vimeo Central, a complete suite for using video in collaboration and employee engagement. Let’s talk about Vimeo and what it’s really like to make a large public SaaS company profitable in a short amount of time. What’s It Like Running a Company Like Vimeo Today? That’s the opportunity here.

AI Search 216

AI Search SaaS Advertising Sales Hiring 216

Clouded Judgement

APRIL 26, 2024

Azure doesn’t disclose exact Azure quarterly revenue (they disclose growth rate in absolute terms and in constant currency), but there are good estimations. Currently, near-term AI demand is a bit higher than our available capacity.” Microsoft kicked off earnings season with a bang!

Azure 152

Azure Cloud Software AI 152

SaaStr

DECEMBER 28, 2023

Class Companion is free for teachers to use and has grown from a handful of teachers when it first became available six months ago, to now being used by teachers at over 5,000 schools. #2. Be careful not to over-rotate based on short-term market dynamics. And how big is your current fund? Our current set of funds totals $3.4B.

Technical Review 199

Technical Review Software Review Payment Solutions Venture Capital 199

Clouded Judgement

SEPTEMBER 1, 2023

” Every week I post a number of charts and tables, but the most popular chart shows the software universe’s median revenue multiple, the long term average, and the 10Y (below). ” After all, the current median software multiple is ~6x, while the long term average is 7.8x. The long term average for that cohort is 9.3x.

Software Review 183

Software Review Cloud Software Revenue 183

SaaStr

APRIL 10, 2024

Ending Unlimited Storage This seems to be a theme with many mature SaaS leaders, as they meter what they used to allow unlimited use of. Paying $79 million to get out of their SF lease, but expecting to save $220m over the full term. It wants efficient growth. And as a result, DropBox’s market cap is $7.8 Billion today.

Scale 215

Scale Churn Scaling Pricing 215

SaaStr

DECEMBER 14, 2023

In terms of goals, Alison and Google Cloud have five “Priority Pillars” to focus on: People and culture — ensuring they have the right talent and that everyone’s growing Lifting mindshare — shifting perception in the market. Alison brings the perspective of all sides of a startup, from investing to SaaS to Cloud.

Cloud 229

Cloud Scale AWS AI 229

Tom Tunguz

APRIL 25, 2024

“Currently, near-term AI demand is a bit higher than our available capacity…In Azure, we expect Q4 revenue growth to be 30% to 31% in constant currency” Even more impressive, if illusive to measure, is the cross-selling ability of AI across Microsoft customers. “We now have 1.8 of revenue in a year. 815% Total $4.5b

Azure 124

Azure AI Search Marketing AI 124

SaaStr

MARCH 30, 2024

It’s the new hot term to describe situations that are challenging. Even the Wall Street Journal put out a piece on it: If you’d asked me earlier in my career, maybe even just 10 years ago, while I wouldn’t have used the word “toxic”, I would have said — hey it happened to me too. Twice this week, at least. I always have.

Interviewing 235

Interviewing 235

SaaStr

SEPTEMBER 3, 2023

If your customers love and trust you, they buy more from you More products, more seats, bigger editions, more use cases Seen this in every single SaaS company I've ever worked with Few do everything they could here — Jason ✨Be Kind✨ Lemkin  (@jasonlk) August 27, 2023 In simpler times, this thinking is a positive. We forced it.

Scale 229

Scale Market Segmentation Customer Success Pricing 229

Tom Tunguz

JULY 8, 2023

The $1m ARR figure used to hold in 2018 & early 2019. A Series A used to mean a single flavor. The term Series A is an arbitrary moniker for a new share class used for convenience. The term Series A is an arbitrary moniker for a new share class used for convenience. Today, is it 2x or 3x?

Metrics 276

Metrics Forecasting Finance Startup 276

Tom Tunguz

MARCH 30, 2023

But in the long-term, usage will be the enduring moat. Machine learning systems, like any complex program, benefit from more use. In this experiment, machine learning agent learns from its mistakes using another machine learning model called a Reflection LLM. Product & engineering ply those insights to improve performance.

Artificial Intelligence 325

Artificial Intelligence AI Machine Learning Generative AI 325

SaaStr

DECEMBER 21, 2023

PST, Jamin Ball, Partner at Altimeter Capital and author of Clouded Judgement , took us through the current state of SaaS and what we should expect in 2024. The light blue line is the 10-year interest rate, and the horizontal gray line is the long-term average multiple. At Workshop Wednesday, held every Wednesday at 10 a.m.

SaaS 240

SaaS Software Metrics Revenue 240

SaaStr

DECEMBER 13, 2023

Numbers are used to bludgeon management. This is when SaaS metrics aren’t used as a tool of understanding to improve your business but to club people with numbers. People use SaaS metrics to mislead and obscure, not to enlighten. They used a $12.5M By understanding the problems, you can extract the solutions. 3: Deja vu.

Metrics 287

Metrics Sales Hiring Benchmarks SaaS 287

SaaStr

SEPTEMBER 5, 2022

Let’s use sales-led organizations as a comparison point. PLG can also be used for account expansion, not just for new revenue. Product-led growth (PLG) companies have become a major trend in the world of SaaS over the last few years. Secret #1: Born, not made. Going from sales-led to PLG is doable, but it is not easy.

Sales Recruiting 240

Sales Recruiting Business Pricing Churn 240

SaaStr

APRIL 20, 2024

" @searchbrat @zapier @kippbodnar @HubSpot @jasonlk pic.twitter.com/dUudpe9s2Q — SaaStr (@saastr) April 16, 2024 HubSpot and Zapier’s CMO had us on their “Marketing Against the Grain” pod / videocast. We lost too much of that. People that want to do the work because they enjoy the work."

Sales Hiring 247

Sales Hiring Startup Marketing Technical Review 247

SaaStr

MARCH 13, 2024

If so, you will be wrestling with something open-source while making a plan of action to make it long-term. Deep customer empathy and real transformational use cases are where the magic lies. Are you re-vampimg your entire product roadmap, or sprinkling AI in along the way? It’s been a very radical process for them.

Generative AI 202

Generative AI AI Cloud Startup 202

Clouded Judgement

DECEMBER 22, 2023

Subscribe now Revisiting the “Is Software Expensive” Question The current median revenue multiple for the software universe is 6.4x, which is ~17% below the long term average multiple of 7.8x. During the period where the long term average multiple was 7.8x, the median projected growth rate was 27%. Top 5 Median: 16.1x

Cloud 177

Cloud Subscription Payment Features Metrics 177

SaaStr

SEPTEMBER 20, 2023

By the end of the year, valuation multiples for Cloud companies hadn’t just fallen below the 10-year trailing average but below the pre-pandemic long-term average we were used to seeing. The past twelve months have been relatively turbulent for Cloud founders. It was a record year for private equity-sponsored deals.

Cloud 236

Cloud Payments Software Review Payment Solutions 236

SaaStr

JUNE 28, 2022

I wrote an original version of How Venture Term Sheets explode (and implode) quite some time back, and TechCrunch was gracious enough to publish it here. VCs stopped doing much diligence, deals closed in days, and term sheets rarely exploded, or imploded. Why do deals fall apart post-term sheet? Even if a term sheet is signed.

Finance 275

Finance Technical Review CTO Hire New CTO 275

Tom Tunguz

OCTOBER 11, 2023

In the last ten years, with capital nearly freely available, many companies have decreased the priority of generating revenue, especially those using product-led growth techniques. To achieve this type of sale requires a long-term view or a willingness to acquire products to bolster a suite. First, revenue is fuel.

compliance 298

compliance Benchmarks Engineering Pricing 298

SaaStr

APRIL 22, 2022

Initially, they had planned on using their temperature sensors to get readings on refrigerators at the company’s main buildings. . Use Salesforce to log product complaints, requests, and more. Lean on customer feedback loops to guide through unfamiliar markets. At Meraki, they gained feedback from customers intuitively.

Innovation 231

Innovation Wireless Scale Marketing 231

Tom Tunguz

NOVEMBER 6, 2021

The contracts are identical twelve month contracts except for the payment terms. Contract B relaxes payment terms to monthly payment, 12 monthly installments for the next year. But there is a viable GTM strategy for startups to book multi-year deals with pre-payment, and use that cash to finance GTM growth.

Sales Hiring 343

Sales Hiring Scale Payments Payment Solutions 343

SaaStr

NOVEMBER 13, 2023

At Drata, they have a principle to ship 60% of use cases really quickly because the opportunity costs of getting from 60% to 90% are enormous. You put the product in the hands of users and use real data from real users to measure success and determine how the features are being used. 1: Ship Fast.

Scale 215

Scale Scaling Sales Hiring Construction 215

SaaStr

MARCH 1, 2024

Infrastructure is the layer where anyone allows you to use these largely generalizable models to create something with a more specific use case. Many others are also creating new LLMs and other models that folks use to get value out of GenAI. Another way to look at this is by how much venture funding goes into the sector.

Generative AI 232

Generative AI Outsourcing Services AI Software Review 232

Tom Tunguz

NOVEMBER 6, 2023

“For one part, there’s some uncertainty in terms of – these customers are being to figure out what it is they are going to ship to their own customers. “As of the end of Q3, 82% of customers were using 2 or more products, up from 80% a year ago. DataDog leads the cloud monitoring & security space.

Scale 229

Scale AI Cloud Mobile 229

SaaStr

OCTOBER 1, 2022

Let me use myself as a case-study. The First VC nevertheless wrote me a term sheet at a lower valuation. The First VC nevertheless wrote me a term sheet at a lower valuation. The First VC also wrote in this term sheet granting his firm 3/5 of the Board seats at Series A. Be (1) clear (2) and respectful. I told him.

246

246

SaaStr

MAY 25, 2023

Probably just say Yes pic.twitter.com/K483lKnyzd — Jason ✨Be Kind✨ Lemkin  (@jasonlk) April 21, 2021 So I wrote a version of this post years ago, about when to think about selling your startup, if you do get an attractive offer. Well, that age does seem to be over ;). 1 turned down an $85m offer on $50k in MRR. And still said NFW.

Acquisition 361

Acquisition Venture Capital Generative AI Scale 361

SaaStr

JULY 8, 2023

Cash is basically stuck on the balance sheet — acquisitions are one of the few ways to really use it. Cash acquisitions can almost be free in the short and medium term for cash-rich big companies. So if they use stock to buy a company when they could use cash for, it leads to additional dilution.

Startup 172

Startup Scale Acquisition Retention 172

SaaStr

JANUARY 2, 2024

A free term. The only challenge with a free term is there’s nowhere else to go. At 16 years and $1.6B ARR, Zendesk today gets 14% of new business from startups. That’s a pretty significant part of the growth of their company. On top of that, if you look at their top accounts globally, 33 of the top 50 customers by ARR are startups.

Startup 178

Startup Scale Underperforming Technical Team AWS 178

SaaStr

MARCH 27, 2023

I think all 3 are useful tools, but you need to be thoughtful about using them and not accidentally abusing them and creating more friction with your team than they are worth. But two thoughts: First, clawbacks rarely are that big of a deal in the end in terms of comp impact. Let’s start with Clawbacks. Usually at least.

Management 233

Management Sales Payment Services Churn 233