Tom Tunguz

DECEMBER 20, 2016

2016 was a year of change for SaaS, and most of the story was the public market. The Hottest Startup Sectors In 2016 - published on January 3rd, this post reviewed the patterns of investment in startups, and in particular, the sectors where investors were increasing their investment the fastest.

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The Angel VC

DECEMBER 12, 2015

As an example, I showed a (fictional) SaaS startup that wants to grow from $1,000 in MRR to ~ $85,000 in MRR within one year. To follow-up on the topic, I've put together a very simple (Google Sheets based) calculator which startup founders might find useful when they work on their plan for 2016. What do you think?

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SaaStock

MARCH 26, 2019

We had a closer look at who the young upstarts of Latin America are in search of the most exciting Latin American SaaS startups. With them in mind, we have created our Startup Program , tailored especially for SaaS startups. Here are the most exciting Latin American SaaS startups that we cannot wait to meet in less than a month.

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Tom Tunguz

NOVEMBER 8, 2015

But compared to 2014, 2015 was a meager year for startups looking to go public or be acquired. It’s not that the quality software companies has declined, nor have growth rates of software startups dwindled. Rather, startups are finding the private financing markets far more attractive than the public ones.

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The Angel VC

MAY 31, 2016

When we invest in a SaaS startup, which almost always happens at the seed stage, the next big milestone on the company’s roadmap is usually a Series A. So what does it take to raise money for a SaaS company in 2016? But financing rounds are obviously not a goal in itself. But they are exceptions, not the rule.

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Tom Tunguz

JANUARY 4, 2019

More money enables startups to achieve greater milestones before raising the next round. To be fair, 22% of companies raised at $0 in ARR. But the average MRR has increased substantially from the last time I analyzed the data. note I’m switching from median to average here). That’s quite a growth rate.

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Tom Tunguz

MARCH 24, 2024

In 2016, the question was easy to answer : sell Ironman not Robocop. The next generation of software startups have a strategic question with different terminology & potentially a different conclusion. Should software assist humans or act on their behalf? Instead of a 50% improvement, these robots were 2.3x more productive.

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Tom Tunguz

NOVEMBER 29, 2015

In 2015, startups benefitted from a vibrant fund raising market. In 2016, I believe they will enjoy a very active acquisition environment. If there are to be massive acquisitions of software companies in 2016, this list of roughly 20 companies are likely to be buyer.

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Tom Tunguz

NOVEMBER 6, 2016

About $1B has been invested in early stage SaaS startups as of November 1. Over the last nine months, marketing startups have raised more dollars in aggregate than any other segment. Operations teams following second, with human resources focused startups in third. Notably, sales startups raised the least amount of capital.

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Tom Tunguz

JULY 15, 2017

The article pointed to the seeming collapse in the amount of venture capital raised by San Francisco startups relative to other regions. The startups raising hundreds of millions or billions might bias the data, I thought. Now it’s the Valley startups’ turn to raise. Note, the levels still exceed 2010-2013.

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SaaStr

DECEMBER 14, 2023

Alison brings the perspective of all sides of a startup, from investing to SaaS to Cloud. Pursuing Two Different Segments: The Tale of Startups vs. Enterprise From a marketing perspective, the GTM marketing position and product market messaging differ between Google Workspace and Google Cloud.

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Tom Tunguz

JANUARY 25, 2016

For startups entering a period of increased capital cost, the wisdom of Porter’s Five Forces is more important to consider now than they have been in the past few years. This can be labor or components of the product the startup must source from third parties. How differentiated are the existing products in the market?

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Tom Tunguz

JULY 28, 2016

Through the end of July in 2016, $70B worth of SaaS companies sold. In 2016, these PE firms aren’t following that playbook. The 2016 software buying spree hasn’t benefitted private startups or unicorns yet, and that reflects the different strategies of the buyers.

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Tom Tunguz

JANUARY 10, 2016

For all the talk about late stage rounds, megarounds and unicorns, early stage startups are benefitting disproportionately from near-record years of venture capital investment. Of the $42B invested in startups in 2015, 34% or about $14B was raised in series A and seed rounds. This money isn’t committed to startup investing.

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Tom Tunguz

APRIL 25, 2016

As the overall venture market environment evolves in 2016, so too does the SaaS and Software segment. In Q1 2016, SaaS rounds increased a modest 10%. But early 2016 pace still exceeds the best quarters of 2010-2012. In summary, SaaS startups today still enjoy one of the best fundraising markets of the last five years.

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SaaStr

MAY 6, 2022

January 2016, SaaS stocks were riding high. It was called 2016: * Everyone panicked * Seemed like multiples would never recover * LinkedIn sold to Microsoft for 7x ARR. That revenue multiples should rise from where they were in 2019. But I’m hardly sure this will happen in practice. And remember, we’ve seen this all before.

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SaaStr

MAY 10, 2022

In 2022, hot startups often raised 3 rounds in 12-15 months. 2016 was tough, too. But the markets also dropped 50% at the start of 2016, and VCs panicked. It was called 2016: * Everyone panicked * Seemed like multiples would never recover * LinkedIn sold to Microsoft for 7x ARR. Most of the time, it will be just fine.

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Tom Tunguz

JUNE 14, 2022

During the dotcom crash in 2001, the Global Financial Crisis of 2008, and the SaaS corrections in 2014, 2016, and 2018, Lee was either COO/CFO or CFO at Twilio, SAY Media, and Ofoto. Lee Kirkpatrick is no stranger to downturns. On Tuesday, June 21st at 10am Pacific time, Office Hours will welcome Lee Kirkpatrick to learn from his experience.

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SaaStr

JUNE 3, 2022

2016: Dharmesh joined us for the first time, with one of the most engaging and highly-rated SaaStr Annual session on ever: their journey to IP O. Dharmesh Shah, co-founder and CTO, gave 2 amazing SaaStr talks and 1 amazing deep-dive so far.

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SaaStr

MARCH 19, 2023

Check out this week’s top blog posts, podcasts, and videos: Top Blog Posts This Week: The Three Valuation Lows in SaaS: 2013, 2016, and 2022 5 Interesting Learnings from Doximity at $450,000,000 in ARR Is Cold Calling Dead? Each week, we round up our most popular content so you can catch up on anything you may have missed.

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SaaStr

APRIL 24, 2021

A lot of our SaaS older times don’t quite know what to make with a lot of B2B startups these days, let alone some public SaaS companies. So many startups these days are claiming they have “ARR” from revenue that … doesn’t recur. Well, if it were 2016, we’d say no. Well of course it does.

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SaaStr

JUNE 1, 2022

So if things are slowing down at your startup, be honest about the root cause. Blame “the economy” too much, and you’re doing yourself a disservice. It’s not slowing down Salesforce, Snowflake, or almost any other SaaS or Cloud leader. Salesforce Growth: 2023 $31.8B (guidance) 2022 $26.5B 2021 $21.25B 2020 $17.1B 2014 $4.1B.

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Tom Tunguz

MARCH 6, 2016

The startup fundraising market in 2016 has been difficult to characterize. VCs invested about $2B in January and February 2016. Punctuated by a concentrated decline in public tech stocks, the sentiment in Startupland has changed from resolute ebullience to a calmness approaching caution.

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Tom Tunguz

JUNE 20, 2022

When Aileen Lee published “Welcome to the Unicorn Club” - the article that coined the word unicorn for a $1b startup - the average public SaaS company commanded a market cap of $1.5b. From 2007 to 2016, $1.5b The largest startups kissed $100b in market cap and higher. 2015 Return Multiple by Round.

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Tom Tunguz

JULY 19, 2017

Tell me three numbers and I can estimate the amount of capital your startup will need to raise. The startups’ revenue target, the average revenue per customer and the average cost of customer acquisition. For example, I’d like to estimate the cost for my SaaS startup to reach $100M in annual recurring revenue (ARR).

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Tom Tunguz

JANUARY 12, 2022

Like high growth startups, cryptocoins are considered risk assets by the market. BTC and ETC moved more or less in synchrony from 2016 to 2018. Beyond the most recent cycle, how often do the web2 and web3 software markets move in synchrony? After all, Web3 is a future incarnation of software and infrastructure.

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Kellblog

SEPTEMBER 13, 2019

I’ll be speaking at the APPEALIE 2019 SaaS Conference and Awards in San Francisco on September 25th and I noticed that in their promotions the folks at APPEALIE had assembled their own Kellblog’s Greatest Hits album from 2016 to 2019, complete with its own cover art. How to Get Your Startup a Halo. ” Cool, indeed.

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SaaStr

JANUARY 29, 2023

1/ Want the best startup VP Sales candidates in the world? Zenefits was the hottest/fastest growing startup from 2013-2016. Though I think they are riskier. Either way, I’d pass on Been There, Done That. Here’s how to get the list of them. First, some context. We were valued at 4.5B

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SaaStr

APRIL 3, 2024

Jennifer has been at PagerDuty since 2016, a disruptive company that took automation to the next level before AI was hot in 2024. As a startup, you can look at it a few ways. They differ from startups because they’re Fortune 100 companies with a lot of legacy, incumbency, and regulation.

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SaaStr

MAY 19, 2023

It’s a time when SaaS and Cloud spend are also at record highs , and many Cloud leaders are still growing at strong rates … yet many startups have stopped growing at all. You can see here multiples are touching the lows of early 2016 and are even lower than 2015 and those early days of SaaS. And really worst of all is multiples.

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SaaStr

OCTOBER 15, 2022

The median multiple fell below 5x at market close for the first time since 2016 (when it briefly fell below 5x) pic.twitter.com/QZ605lMswz. And yes, there are many hot startups that raised at crazy valuations that are stuck and can’t raise again. That’s massive change. — Jamin Ball (@jaminball) October 14, 2022.

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Tom Tunguz

JULY 12, 2016

In addition to increasing labor costs, startups in San Francisco are facing monotonically increasing real estate prices. JLL the real estate broker shared their data on the average asking rent in San Francisco from 2007 two 2016, year to date. But 2016 is on track to be the lowest in six years at an annual rate of just about 1M sq.

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SaaStr

JUNE 23, 2023

The first weeks at an early-stage startup are usually exciting. In June of 2016, the beginnings of Loom, called OpenVid, became the number one Product Hunt that day, and the following day, they launched more videos than the day before. Many startups try to do too many things in the early days. They had made it.

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FastSpring

APRIL 17, 2024

Since 2016, SaaStock has helped more founders, investors, and operators connect, learn, and grow than any other SaaS conference globally. We’d love to talk with you in person! Join us at the Palmer Events Center, in Austin, TX, from May 13th to 15th, for an extraordinary event dedicated to all things SaaS.

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Tom Tunguz

DECEMBER 6, 2016

What is your SaaS startup worth in an acquisition? What is your SaaS startup worth in an acquisition? 2013 was a banner year, followed by a steep drop in 2015 and a slight recovery in 2016 at 11.5x. We haven’t yet seen material consolidation of SaaS startups, which may take place in 2017.

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Tom Tunguz

APRIL 29, 2017

Instead of raising an equity round, a startup might choose to borrow money - and for good reason. The chart above shows the amount of venture debt borrowed by US technology startups. Late stage startups. In 2016, we saw the first $1B venture debt round. Venture debt dilutes founders much less than equity rounds.

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Tom Tunguz

JUNE 12, 2016

In the 2016 acquisition market, the median acquisition multiple is 7.8x This acquisition will have three implications for startups. With nearly $40B in SaaS M&A so far this year, 2016 is shaping up to be the best year for SaaS M&A ever. All these data points are helpful to startups. next 12 month revenues.

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