Tom Tunguz

DECEMBER 26, 2018

Just where are we pricing SaaS companies today? Then prices began a long descent into the February nadir at 3.3x These are exceptional businesses growing at exceptional rates trading at exceptional prices. Multiples at IPO will be lower in 2019 than for most of 2018. Reading the news in the past week made me wonder.

Pricing 217

Pricing SaaS Startup Investment 217

Tom Tunguz

SEPTEMBER 16, 2019

In other words, public market investors decided to sell fastest growing companies, deciding the prices were too expensive. The bottom line for startups is that the market continues to price next-generation software companies at close to all time premiums, even with the recent vacillations.

SaaS 254

SaaS Pricing Enterprise Startup 254

SaaStr

MAY 27, 2025

Four Out of Seven IPOs in 2024 Were Down Rounds And That’s Actually Normal The Surprise : Despite investor hand-wringing about “down round IPOs,” 57% of the 2024 VC-backed tech IPOs priced below their last private valuation but historically, this isn’t unusual and doesn’t predict poor performance.

Outsourcing Services 164

Outsourcing Services Venture Capital Outsourced Development Data 164

SaaStock

JANUARY 23, 2019

Building on the success of three flagship conferences in Dublin, as well as numerous smaller conferences around Europe and US that have brought together thousands of SaaS founders, execs and investors, we’re taking this SaaS show globally, touching down on a total of 5 continents in 2019. improving positioning and pricing.

Scale 229

Scale Payment Features Subscription SaaS 229

SaaStr

JULY 5, 2019

We now produce so much content on SaaStr, we thought we’d share the Top 20 Posts of 2019, so far. What’s A Typical Price Increase I Can Expect When Renewing A SaaS Subscription? Raising pricing on existing customers is complicated. #16. The post The Top 20 SaaStr Posts of 2019 (so far) appeared first on SaaStr.

Sales Hiring 187

Sales Hiring Scale Venture Capital Acquisition 187

SaaStr

MARCH 11, 2022

And so, Cloud multiples have rationally fallen back to where they were in 2018 and 2019. The argument here is multiples have fallen too far, since the best SaaS and Cloud companies are growing so, so much faster than in 2018 and 2019. Seed investors that see multiples reverting to the past are becoming much more price conscious.

Scale 325

Scale SaaS Cloud Pricing 325

Intercom, Inc.

DECEMBER 12, 2018

When preparing for any technology implementation, if you’re anything like me your first step is to head straight to Google or G2 Crowd , compare feature sets and pricing, and maybe kick the tires with a free trial to see if it’s a good fit. Winning marketing tech stacks in 2019. Strategy first, technology second.

Technical Review 223

Technical Review Technology Scale Marketing 223

SaaStr

JULY 8, 2019

The pros are that the revenue is highly predictable, and most SaaS applications are still priced this way. The cons are that it the one-size-fits-all approach to subscription pricing is a bit … dated … in SaaS. Does my price automatically go up, even if I just add 1 or 2 users to my account? But be more flexible in 2019/2020.

Pricing 190

Pricing SaaS Payment Features Subscription 190

SaaStr

FEBRUARY 10, 2025

CEO Tim Zheng came to SaaStr Annual to share the deep dive on the journey from SLG to PLG here: Initial Challenges and Market Position In 2019, Apollo.io Strategic Reset The transformation began with a fundamental strategic reset: The company dramatically revised its pricing strategy, reducing ACVs from $10,000 to $1,000.

Scale 152

Scale Scaling Outsourced Development Sales 152

Tom Tunguz

NOVEMBER 19, 2020

Through Q3 2020, late stage investors have invested as much as the entirety of 2019, and should things continue linearly we should expect the final tally to exceed $100B. When demand exceeds supply, prices increase. And prices of all exits (IPOs, buyouts, and M&A) have all increased with IPOs seeing the most appreciation.

Venture Capital 353

Venture Capital Government Pricing Investment 353

Tom Tunguz

MAY 10, 2020

We can plug in last year’s numbers in the table linked here to get an approximation for the value of the S&P 500 on Dec 31, 2019, of 3224, and this implies an S&P dividend growth rate of 5.8%. So you could explain the 15% decline by saying: the market has priced in two years of no dividends.

Marketing 357

Marketing Investment Pricing Revenue 357

SaaStr

DECEMBER 18, 2022

Back to where we were in the markets at the end of 2019. Share prices not in the end budging for 3+ years when ARR in many cases has doubled or tripled is worse than the flat share prices reflect. We’re back to 2019. At least, sort of. Cloud is still growing, SaaS is still in the early and middle innings.

Cloud 295

Cloud Pricing Metrics SaaS 295

SaaStock

FEBRUARY 14, 2019

Campbell is probably one of the world’s foremost experts on pricing. In the past months, he has offered a pricing teardown to every subscription business you can think of, from Spotify and Netflix to NYTimes and Match.com.Patrick’s professional experience is diverse and curious: his first job was at the U.S.

Technical Review 207

Technical Review Scale Entrepreneurship Sales Hiring 207

SaaStr

APRIL 14, 2019

“Shareholders have sold Slack stock to private buyers at prices as high as $25 or $26 a share, which implies a company valuation of about $16 billion” “More than 5 million developers use these tools, according to Gayathri Rajan, who runs the Google Maps enterprise team. . Going more enterprise means adding more salespeople.

Cloud 156

Cloud Enterprise Pricing Development 156

SaaStr

MARCH 8, 2025

In 2014, Atiyah co-founded Parabus, a consumer-focused startup that automatically secured refunds when prices dropped on online purchases. At its peak, Parabus saved millions of dollars for its 10 million customers before being acquired by Capital One after just three years.

CTO Hire 191

CTO Hire CTO Coach Scale CTO 191

Tom Tunguz

JUNE 11, 2019

To get a sense of how this price and multiple compares in clearer terms, lets look at multiples vs growth rate. The 2019 mergers are in red. in acquisitions suggests that 2019 will be similarly active as 2018, which saw $66B of acquisitions. They include Tableau, SendGrid and Hortonworks. Tableau is the middle red dot.

Acquisition 271

Acquisition Pricing Startup Software 271

SaaStr

MAY 21, 2022

Sprout Social IPO’d in Dec 2019 at an $800m market cap. A few case studies: * Sprout Social IPO’d in December 2019 at an $800m market-cap. ZoomInfo was the first post-Covid IPO in June 2020, and it priced at $8.3 It IPO’d early, in a crowded space. But they kept on going, and gong, and growing. They’re worth $2.7 It’s tripled.

AWS 285

AWS SaaS Cloud Scale 285

Tom Tunguz

NOVEMBER 15, 2021

When investing in a crypto startup that will issue a token, an investor considers two prices - the price of the equity and the price of the token. The correlation between the growth rate of the economy (using 2019 data and the ETR) is 0.8. The chart orders the countries by GDP, largest on the bottom. Ok, that was a lot.

Data 328

Data Pricing Revenue Startup 328

Tom Tunguz

JUNE 23, 2024

Private market capital values companies at higher prices (from higher multiples) & is less expensive to raise. 1 PwC estimates cost based on historical data from 2019-2022 As private dollars entered the late stage market, why wouldn’t a startup raise private dollars instead of public? which will further underscore the trend.

Revenue 308

Revenue Finance Trends Startup 308

Tom Tunguz

SEPTEMBER 30, 2019

I was curious about the real trends in share prices, so I gathered the data on some of the more salient IPOs. The leftmost column is the price of the shares at IPO, followed by the share price on the first day close, followed by Friday’s price. The chart above shows 11 IPOs at different points in their life cycles.

Startup 229

Startup Marketing Pricing Trends 229

SaaStr

APRIL 17, 2024

Rubrik has gone aggressively more upmarket — from just 23 $100k customers in 2019 to 1,742 in 2024. #3. But getting them all really requires big stock price growth, all the way up to 759% stock price aprpeciation. But even as it approaches $1B in ARR, Rubrik is still growing New New Customers more than 20% a year.

Scale 294

Scale Pricing Scaling Cloud 294

SaaStr

OCTOBER 14, 2021

We’re getting used to seeing these super-high NRR numbers from the top developer-focused leaders, in many cases because utility pricing often encourages it (see also Datadog, Twilio, etc). And GitLab closed their first $1m customer in 2019. . — GitLab (@gitlab) October 14, 2021. 5 Interesting Learnings: #1.

Outsourced Development 66

Outsourced Development Software Development Innovation Cloud 66

Incredo

JULY 31, 2019

percent and reach 85 billion in 2019. Another research firm, Gartner Group says that SaaS industry remains the largest segment of the cloud market. The industry revenue is expected to grow 17.8

SaaS 195

SaaS Pricing Cloud Revenue 195

SaaStr

DECEMBER 23, 2023

Aggressive price increases across the board consumed much CS energy as well. #3. Strip our price increases, it looks even worse. We aren’t the knowledge workers we were from 2011-2019, either. So be it, but that left even fewer resources and attention on just plain … customer success. And what about CSAT?

Customer Success 297

Customer Success AI Pricing Enterprise 297

SaaStr

FEBRUARY 26, 2022

But when you knew the next round was coming, and at a much higher price, neither founders nor investors had to worry too much if the burn rate was higher than it should have been. But for now, we have to run our startups again like it was 2019 or early 2020. . * It was OK to be a bit sloppy around your burn rate. I really do.

Venture Capital 364

Venture Capital Cloud Startup SaaS 364

SaaStr

JUNE 18, 2021

Especially in 2019. Second, raise if the price is insane. If you are hot and you can get an incredible price (i.e., >=3x more than you are worth), just take it if you will need it later. If you are hot and you can get an incredible price (i.e., >=3x more than you are worth), just take it if you will need it later.

Sales Hiring 330

Sales Hiring Scale Venture Capital Finance 330

SaaStr

OCTOBER 25, 2023

Moved to 71% Annual Contracts (From 54% in 2019) As Have Gone More Enterprise This is what I’d expect, but very helpful to see this data presented this way, as they’ve moved to half of their revenue from $50k+ deals, vs the $2k for smaller customers: And a few bonus learnings: #6. But a 3% price boost likely materially helped. #7.

SMB 290

SMB AI Onboarding Cloud 290

Tom Tunguz

MAY 10, 2020

We can plug in last year’s numbers in the table linked here to get an approximation for the value of the S&P 500 on Dec 31, 2019, of 3224, and this implies an S&P dividend growth rate of 5.8%. So you could explain the 15% decline by saying: the market has priced in two years of no dividends.

Marketing 264

Marketing Investment Pricing Revenue 264

SaaStr

DECEMBER 30, 2019

Grab the final 2019 priced tickets here. The post SaaStr Annual Prices Go Up $400 (!) Only 11% have bought their pass! That’s OK if you want to pay more. Tickets go Late Bird on Jan 1 and go up $400!! You can come now for 40% less. So who’s coming and speaking? SaaStr Annual. It’s Where The Cloud Meets.

VPCs (Virtual Private Cloud) 148

VPCs (Virtual Private Cloud) Pricing Cloud SaaS 148

SaaStr

JUNE 19, 2024

Hitting a Plateau in 2018 The company ran into a bit of a plateau around 2018-2019. Expand pricing and packaging. Pricing and Packaging Can Fuel or Kill Monetization Bitly’s online channel was relatively young, launching in 2019. With experimentation comes pricing and entitlement tests. Refine the user experience.

Scale 297

Scale Scaling Underperforming Technical Team User Experience 297

SaaStr

DECEMBER 6, 2021

Jennifer Tejada, CEO of PagerDuty, discusses the process leading up to IPO in 2019, her main focus for the company in the years since, and the lessons she’s learned along the way. Before PagerDuty went public in 2019, we had our clear “why” for doing so. Enter your email below for the latest SaaStr updates.

DevOps as a Service 271

DevOps as a Service Scale Cloud Interviewing 271

SaaStr

MARCH 10, 2021

Pricing is based on products and volume, not seats. Procore has done very well aligning pricing naturally with usage. Plain vanilla per-seat pricing is becoming less and less the dominant model in public SaaS and Cloud companies. #2. 5 Interesting Learnings: #1. 43k ACV across 10,000+ Customers. Many ignore it. #3.

Construction 283

Construction Scale Pricing Mobile 283

SaaStr

JUNE 6, 2022

This interview with CNBC’s Ari Levy took place in February 2019, shortly after Plaid raised a Series C round at a $2.7B In 2019, they also acquired Quovo, a company that focused on investment accounts, to make it easier for consumers to manage their investments. Up today: Plaid co-founder and CEO, Zach Perret. billion valuation.

Banking 281

Banking Scale Acquisition Interviewing 281

SaaStr

MAY 19, 2019

But, they were also able to raise prices. Expanding into new markets is never cheap, and while Xero is very efficient overall, it’s cost to acquire a customer went up from $376 in 2018 to $397 in 2019. They also raised effective prices, however. Sales & marketing costs are going up.

SMB 268

SMB Customer Lifetime Value AWS Churn 268

SaaStr

SEPTEMBER 26, 2019

Housing prices apparently are falling in the Bay Area. Even in the darkest days of 2019, enterprises still. Your experience may have been different, but in ours, maybe only 10% of enterprises under stress tried to negotiate contract prices down on renewals. This means part of the markets are not functioning properly, folks.

SaaS Payments 280

SaaS Payments Sales Hiring Scale SMB 280

SaaStr

APRIL 6, 2021

71% of Olo’s customers now use all 3 of its modules, up from 44% in 2019. It added its Dispatch and Rails modules just in 2015 and 2017, and added transactional pricing to its Ordering module in 2016. of its revenues in 2019, but only 21% today. #8. We’ve seen this with Box and others as well. in 2018.

Merchant Services 245

Merchant Services SaaS Payments Payments Payment Services 245

SaaStr

FEBRUARY 11, 2019

Still processing all the learnings from 2019 SaaStr Annual? But one thing was clear — the 2019 Annual was both the best Annual ever, and the start of a new chapter for SaaStr Annuals 6-10, i.e. 2020-2024+. We’ll build on everything great in 2019 for years to come. I know I still am. We’ll write more soon.

Banking 196

Banking Pricing Scaling 196