SaaStr

FEBRUARY 9, 2024

They had been building toward an SMB audience, so hiring 50 people in sales against a product that wasn’t ready for a specific audience would’ve been a mistake. So when you think about acquisition, retention, and expansion, they all revolve around the product capabilities in a PLG motion. Next, think about product maturity.

Scale 265

Scale Sales Hiring Sales Marketing 265

SaaStr

DECEMBER 27, 2020

Those of us who’ve been around a while think of New Relic as a freemium and almost SMB tool, but today 77% of their revenue comes from accounts greater than $100k. If New Relic had even 120% NRR, it’s growth rate with the exact same rate of new customer acquisition would be 137% instead.

Scale 304

Scale Outsourced Development SMB Cloud 304

Tom Tunguz

JULY 15, 2019

Open source remains a viable customer acquisition strategy despite the threat from the cloud vendors; Amazon in particular. Last, I bucketed the companies into price segments: SMB, Mid-Market and Enterprise, based on my estimates of their ACVs. There’s a broad distribution of companies across each price segment.

Enterprise 194

Enterprise Payments Payment Solutions SMB 194

Clouded Judgement

APRIL 11, 2024

This has all resulted in the median stock price declining 5% YTD. For businesses selling predominantly to SMB customers, these benchmarks are all slightly lower given the higher-churn nature of SMBs. I consider >120% best in class for companies selling to SMBs (like Bill.com). Are forward estimates “de-risked.”

Cloud 177

Cloud Software Azure AWS 177

SaaStr

AUGUST 7, 2023

CAC stands for Customer Acquisition Costs and measures how much it costs to buy a new customer. That works for a hyper-SMB model. No one gets in right in sales and marketing, but if you can put a little more budget into growth vs. new acquisition, magic can happen. You can read more about real-world ARR examples here.

Metrics 196

Metrics SaaS Sales Hiring Finance 196

Clouded Judgement

MARCH 22, 2024

For SaaS businesses that target smaller SMB customer segments, gross retention is typically in the mid to low 80’s with net expansion in the ~105% range. And once a customer has paid back the initial acquisitions costs to acquire it, all future streams of revenue can loosely be described as a cash flow annuity.

AI 183

AI Revenue Cloud Technical Advisors 183

Clouded Judgement

JUNE 9, 2023

Very healthy new business (new customer) acquisition. Quarterly Reports Summary Top 10 EV / NTM Revenue Multiples Top 10 Weekly Share Price Movement Update on Multiples SaaS businesses are generally valued on a multiple of their revenue - in most cases the projected revenue for the next 12 months.

Trends 130

Trends Cloud Azure AWS 130

SaaStr

JANUARY 24, 2024

Scaling Enterprise vs. Mid-Market Sales: Key Takeaways from Calendly It’s a common blueprint to start with SMB and mid-market accounts as your ideal customers. So, they made some changes to the product, made acquisitions, changed pricing, packaging, messaging, and positioning alongside improvements in the sales organization.

Scale 231

Scale Sales Hiring Scaling Revenue 231

Tom Tunguz

SEPTEMBER 8, 2014

Is there an optimal price for a product to maximize a SaaS startup’s sales efficiency ? Do million-dollar enterprise price points and field sales people create more efficient sales organizations than content-marketing-driven SMB startups? But, I don’t have the data to prove that hypothesis.

Pricing 100

Pricing Startup Sales SaaS 100

SaaStr

AUGUST 30, 2023

They have privacy, security, vendor transitions, and acquisition support. You can filter your search by industry, whether you’re SMB, mid-market, or Enterprise, etc. On sites like G2, it makes sense that the number one slot is a safe bet. They’ve been in the game for a while, so the product works. Let’s look at an example.

AI Search 201

AI Search AI ChatGPT Software Review 201

Clouded Judgement

DECEMBER 21, 2023

This matters a lot more when stock prices are going down, and management teams often grant additional shares to make employees whole (thus increasing dilution even more) Net Revenue Retention High net revenue retention is the fourth aspect of a successful quarter, and one of my favorite metrics to evaluate in private SaaS companies.

Cloud 177

Cloud Software Benchmarks Retention 177

OPEXEngine

MAY 18, 2021

SaaS metrics are viewed differently at different stages of growth and for different sales models, primarily whether a company is selling into an SMB or enterprise marketplace. Contracted expansion revenue i.e. add-ons or upgrades that affect the annual subscription price of the customer should be included. . Usage Fee-Based ARR.

SaaS Payments 98

SaaS Payments Metrics Payments Payment Services 98

FastSpring

DECEMBER 7, 2023

“This is everyday for me, so I love talking about it,” says Carl Hargreaves about mergers and acquisitions. As the Director of Corporate Development & Strategic Partnerships at WP Engine , Carl has worked on many acquisitions and partnerships, including brands like Flywheel, Perfect Dashboard, Block Lab, and recently, Delicious Brains.

Software Review 136

Software Review Technical Review Development Team Review Branding 136

Clouded Judgement

SEPTEMBER 12, 2023

For businesses selling predominantly to SMB customers, these benchmarks are all slightly lower given the higher-churn nature of SMBs. I consider >120% best in class for companies selling to SMBs (like Bill.com). What I’ve shown below is the market-adjusted stock price reaction.

Cloud 169

Cloud Software Benchmarks Retention 169

Sales Hacker

FEBRUARY 2, 2021

SMB Sales vs Enterprise Sales Process. This model is relatively popular for companies dealing with low-cost products associated with low customer acquisition cost. Unlike the self sales model, where the volume of sales is somewhat higher, in the transactional sales model, sales volume is lower with a higher price point.

Scale 95

Scale Enterprise Marketing Sales 95

Tom Tunguz

AUGUST 26, 2014

HubSpot’s target customer base are SMBs and with this price point, it’s possible to support a profitable inside sales model if the team is very efficient. HubSpot is the second fastest SMB SaaS company to IPO yet, achieving the mark within 8 years. Only WIX, CTCT and RNG had smaller figures of $86, $265 and $352.

Benchmarks 111

Benchmarks SMB Metrics SaaS 111

Clouded Judgement

APRIL 12, 2023

This matters a lot more when stock prices are going down, and management teams often grant additional shares to make employees whole (thus increasing dilution even more) Net Revenue Retention High net revenue retention is the fourth aspect of a successful quarter, and one of my favorite metrics to evaluate in private SaaS companies.

Cloud 161

Cloud Software Benchmarks Retention 161

Tom Tunguz

JUNE 12, 2014

To answer those questions, I’ve pulled together data from a basket of 46 publicly traded SaaS/Cloud companies and segmented them based on their average annual customer value (ACV) into three buckets: SMB ( =$10k to $100k). The median SMB SaaS startup spends significantly less on sales and marketing through year 4 of their lives.

Startup 100

Startup SMB Sales Hiring Acquisition 100

Clouded Judgement

JUNE 20, 2023

The market is clearly pricing in lower rates + reacceleration of growth. For businesses selling predominantly to SMB customers, these benchmarks are all slightly lower given the higher-churn nature of SMBs. I consider >120% best in class for companies selling to SMBs (like Bill.com).

Cloud 161

Cloud Software Benchmarks Scale 161

SaaStr

NOVEMBER 2, 2019

How does Krish think about purely serving the SMB market? How does he think about the mortality rate of SMBs? How does Krish think your customer acquisition and GTM strategy has to change with the movement from SMB to enterprise? Billion story from its launch in 2008 to its 2018 acquisition by Recruit Holdings.

Scale 128

Scale SaaS Payments Sales Recruiting Payment Services 128

Clouded Judgement

DECEMBER 20, 2022

This matters a lot more when stock prices are going down, and management teams often grant additional shares to make employees whole (thus increasing dilution even more) Net Revenue Retention High net revenue retention is the fourth aspect of a successful quarter, and one of my favorite metrics to evaluate in private SaaS companies.

Cloud 130

Cloud Software Review Software Benchmarks 130

FastSpring

SEPTEMBER 2, 2020

Depending on what calculation you use, LTV can paint an honest picture of whether your customers are spending and staying long enough to cover acquisition costs and hopefully—make you a profit. Tracking your LTV/CAC ratio allows you to spend the right amount on customer acquisition while still making a profit.

Scale 135

Scale Payment Methods Payments SaaS Payments 135

Sales Hacker

APRIL 10, 2018

The SMB segment—going upstream vs. downstream. Pro-user, SMB, Enterprise, this requires a specific Go To Market strategy. When we map the number of deals committed against a listed price (ACV), you will notice deals starting to segment around discount levels. The SMB Segment: Going Upstream vs. Downstream.

SMB 72

SMB Strategy Outsourced Development Marketing 72

ChurnZero

MARCH 18, 2022

Yours is, you have a super low Customer Acquisition Cost (CAC) so you can justify that with the super high churn. If you tell me that we have this awesome land-and-expand model, we go in with a really low price, and then we have a dedicated expansion team that does these upsells, and I say, “Wow, what an amazing story.

Customer Success 98

Customer Success Metrics SaaS Banking 98

OpenView Labs

APRIL 27, 2021

Above: Logz.io’s pricing page. After getting the project off the ground, they started experimenting with self-service pricing. With a sales-driven model, changing prices is a complicated and arduous process that involves training your whole sales team. hasn’t just attracted very small, SMB customers.

Scale 67

Scale Outsourced Development Enterprise Pricing 67

User Pilot

AUGUST 6, 2023

A consistent omnichannel customer experience can improve satisfaction , build loyalty , drive acquisition, increase retention , boost LTV, and help you make data-driven decisions. User acquisition. Promotional emails are consistent with the information on your pricing pages. Source: SMB Compass. Higher retention.

Investment 77

Investment Banking Social Media Customer Lifetime Value 77

OPEXEngine

FEBRUARY 22, 2022

SMB customers will want high-touch sales engagement and service delivery but SMM SaaS companies will likely not have the budget necessary to justify providing this level of sales support. The other option is to outperform lower-cost competitors by gaining market share, usually by lowering their price point to achieve virality.

SaaS Payments 52

SaaS Payments Payment Services Payment Methods Marketplace as a Service 52

SaaStr

MARCH 20, 2020

318: The first step in success with SMB clients is to recognize that it’s not a one size fits all scenario. Companies need a specialized approach for SMB accounts, different than the tactics used for Enterprise. I look at the growth of our organic acquisitions. This episode is sponsored by TaxJar. Harry Stebbings: No, I agree.

SMB 180

SMB Scale Startup Marketplace as a Service 180

Baremetrics

JANUARY 24, 2021

A year earlier we’d launched the MVP of the model allowing SMB customers to input a credit card to get access to the platform, but we hadn’t had a chance to dedicate time or resources to optimizing a proper SaaS onboarding funnel. We were looking to relaunch the user-driven, SaaS side of our businesses.

Churn 71

Churn SaaS Payments Payment Methods Payment Solutions 71

OPEXEngine

NOVEMBER 17, 2020

Customer Acquisition Cost (CAC). Especially now, since the onset of the pandemic, most companies have shifted some acquisition resources to customer retention—especially in 2020, look at what was spent on acquiring new customers and back-out anything that doesn’t apply. Take CAC, for example.

Systems Review 52

Systems Review Technical Review Payment Features Scale 52

Sales Hacker

MAY 1, 2018

4) Growth in an SMB, mid-market, and enterprise [5:10]. 8) Pricing as an objection [25:30]. Rick Smolen: Greenhouse is a SaaS company focused on Talent Acquisition. How to Sell Your Software to a Big Company: SMB Vs. Enterprise. Sam Jacobs: Give us an idea of the dynamics of SMB vs. mid-market vs. enterprise.

Sales Recruiting 47

Sales Recruiting Sales Hiring Sales SMB 47

SaaStr

AUGUST 9, 2019

How does Vikas see the space play out in the coming years when it comes to acquisitions? You’ve seen SalesForce with a number of significant acquisitions in the last 12 months, as an example. It’s not an SMB where you’re getting volumes of 100 a day. Does this not lead to a consolidatory environment?

SaaS Payments 132

SaaS Payments Cloud Technical Review Scale 132

Aaron Beashel

MAY 5, 2014

I wanted to present this framework for thinking about customer acquisition and retention in the hope it will give some context to all the different marketing channels and initiatives that are available to you and help you prioritise and execute the right ones at the right time. Model 2: Touchless Acquisition + Bottom Up Sales.

Engineering 100

Engineering Scale SaaS Acquisition 100

Casey Accidental

NOVEMBER 13, 2019

If driving more customers was your customers’ #1 need, and that’s not what you helped them with, you probably didn’t build a very successful business, or the problem of solving customer acquisition for that market is very difficult. Customer acquisition was always a key value proposition, and they delivered on it.

Marketplace as a Service 106

Marketplace as a Service Business Model Business Underperforming Technical Team 106

SaaStr

OCTOBER 29, 2019

We’re going to talk about matching price to value, and I’m going to share some lessons from my time as both an operator and an investor. This is a mobile solution for SMB’s to send an invoice and get paid. This is an interesting study that was done by the folks from Price Intelligently. Hi, everybody.

Payments 100

Payments Pricing Compensation SaaS Payments 100

Sales Hacker

JANUARY 29, 2018

The root cause of today’s challenges can be traced back to the use of this outdated model based on low volume of deals at a higher price. Due to the lower price, it also requires a higher volume of deals to attain a similar kind of growth. This may take >24 months. This high- velocity creates a “manufacturing line” approach.

Sales Recruiting 74

Sales Recruiting Scale Sales Hiring Sales 74

Brian Balfour

JULY 18, 2017

The higher the price, the greater the friction. You can have a business here, but your acquisition strategy ends up a patchwork of bits and pieces from a lot of different channels rather than owning one channel. If you are making changes to your model (pricing, how you charge, etc.), Pretty minimal.

Growth Hacking 65

Growth Hacking B2B B2C SMB 65