Clouded Judgement

FEBRUARY 16, 2024

” From AWS (paraphrased): They said they expect the reaccleration they saw in Q4 to continue into 2024 2024 Estimate Updates One important metric I’m tracking this quarter is the change in 2024 estimates pre / post earnings. I created this subset to show companies where FCF is a relevant valuation metric.

Cloud 161

Cloud AWS Metrics Subscription 161

Clouded Judgement

AUGUST 4, 2023

” These are two quotes about AWS on the Amazon earnings call. AWS grew 16% in Q1, but called out growth in April (first month of Q2) was 11%. Given most software companies are not profitable, or not generating meaningful FCF, it’s the only metric to compare the entire industry against.

Cloud 130

Cloud Azure Cost optimization & reporting AWS 130

Clouded Judgement

JANUARY 6, 2023

Cloud Downgrades This week UBS came out with a couple research reports citing concerns in AWS / Azure growth. This brings me back to AWS / Azure downgrades. This was the worst tone that we’ve heard in years from large AWS/Azure partners, a group that usually expresses different shades of optimism about AWS/Azure growth.”

Cloud 130

Cloud Azure AWS Underperforming Technical Team 130

Clouded Judgement

APRIL 28, 2023

AWS (Amazon), Azure (Microsoft), and Google Cloud (Google) all reported this week. Then AWS appeared to add fuel to that hope before giving us a huge rug pull. After all, they had a lot of AI tailwinds, and benefited tremendously from consolidation (without a headwind of a larger base of smaller startups, like AWS).

Cloud 130

Cloud Azure AWS AI Search 130

Clouded Judgement

OCTOBER 28, 2022

Hyperscalers Report Quarterly Earnings This week we saw AWS (Amazon), GCP (Google) and Azure (Microsoft) report earnings. Overall, it wasn’t pretty… AWS grew 28% when expectations were 30-31%. Every week I’ll provide updates on the latest trends in cloud software companies. Follow along to stay up to date!

Cloud 130

Cloud Azure AWS Cost optimization & reporting 130

Clouded Judgement

SEPTEMBER 8, 2023

” We saw some green shoots in AWS and a few other consumption names, and overall sentiment seemed more positive. I’ve put together a number of charts below to show how metrics from this quarter compared to prior quarters. I created this subset to show companies where FCF is a relevant valuation metric.

Cloud 169

Cloud Software Review AWS Trends 169

Clouded Judgement

MARCH 22, 2024

Subscribe now ARR (Annual Recurring Revenue) vs ERR (Experimental Runrate Revenue) ARR (Annual Recurring Revenue) is one of the most popular SaaS (Non-GAAP) metrics. However, it’s also one of the most loosely used metrics, and is frequently misused. It’s probably better described as re-occurring vs recurring.

AI 183

AI Revenue Cloud Technical Advisors 183

Clouded Judgement

APRIL 21, 2023

Next week we get all 3 hyperscalers reporting (AWS from Amazon, Azure from Microsoft, and GCP from Google). On AWS, in their Q4 earnings call they said AWS was growing “mid teens” in January (down from 20% in Q4). Companies that do not disclose subscription rev have been left out of the analysis and are listed as NA.

Cloud 130

Cloud Azure AWS GCP(Google Cloud Platform) 130

Clouded Judgement

NOVEMBER 10, 2023

Hyperscalers (AWS, Azure, GCP as companies look for cloud GPUs who aren’t building out their own data centers) Infra (Data layer, orchestration, monitoring, ops, etc) Durable Applications We’ve clearly well underway of the first 3 layers monetizing. I created this subset to show companies where FCF is a relevant valuation metric.

Cloud 183

Cloud Artificial Intelligence AI GCP(Google Cloud Platform) 183

Clouded Judgement

JULY 28, 2023

AI = Data + Compute I’ll continue beating this drum, but we got two great quotes from Azure and AWS this week. ” Then at AWS Summit they called out “Your data is your differentiator when it comes to Generative AI.” AWS reports next week. ” Data is more important than ever! So what did we learn?

Cloud 130

Cloud Azure AWS GCP(Google Cloud Platform) 130

Clouded Judgement

JUNE 9, 2023

They did call out sequential growth in Confluent Cloud every quarter this year which was a big positive Still seeing elongated deal cycles and less expansion revenue The Bad AWS: Headwinds Getting Worse Their quarter ended in March, but on the earnings call they called out weakening growth in April.

Trends 130

Trends Cloud Azure AWS 130

Clouded Judgement

SEPTEMBER 15, 2023

AWS growth seems to be re-accelerating, and qualitative feedback from a number of companies in Q2 (especially those with July quarter ends) suggested new customer bookings conversations were picking up. I created this subset to show companies where FCF is a relevant valuation metric. Securities and Exchange Commission.

Software Review 130

Software Review Cloud Software AWS 130

Stax

APRIL 18, 2024

SaaS companies deliver software applications over the internet on a subscription basis, simplifying access and management for users. SaaS, or Software as a Service, companies host and deliver software applications over the internet on a subscription basis. Primarily through direct-to-user subscriptions and third-party distributors.

Outsourcing Services 88

Outsourcing Services SaaS Payments Payment Services Payment Methods 88

CloudGeometry

MARCH 3, 2022

It’s easy to get lost in the noise of “SaaS monetization makes the world go round,” “Subscriptions mean printing money,” and other hype. The more money you will have left to add more customers, get them committed to subscriptions, and keep them away from your competitors. This is known as a unit metric.

Well Architected Framework 130

Well Architected Framework VPCs (Virtual Private Cloud) SaaS Cloud 130

OPEXEngine

JUNE 11, 2020

You hear the terms SaaS, subscription, term licenses and perpetual license software tossed around frequently. We sometimes hear companies call themselves “SaaS” companies, because they sell subscriptions, but they do not host software. The product is hosted by the vendor or a 3 rd party (like AWS).

SaaS Payments 52

SaaS Payments Payment Solutions Subscription Payment Features 52

SaaStr

NOVEMBER 14, 2023

Then, we moved to a more customer-friendly model with SaaS and subscription-based pricing. What’s evolved over the years and is driven by hyper-scalers like Google Azure, AWS, Twilio, and Stripe is the consumption-based model. Rather than compensating based on ARR, it’s based on a volume and quality-based metric.

Compensation 176

Compensation Sales Azure AWS 176

Chart Mogul

NOVEMBER 30, 2023

Decision-makers still rely on ChartMogul charts and segments to analyze our subscription data, but as we started collecting a lot more different types of data from a lot more sources, we needed a sustainable data management plan for our growing team.

Engineering 52

Engineering K8S orchestration (Kubernetes) Data AWS 52

SaaStr

MARCH 31, 2022

And it’s one of the three large cloud vendors that we all know: Microsoft, AWS, and Google. AWS’s marketplace has seen 1.5 million subscriptions transacted and Google’s marketplace has seen 3X growth in SaaS sales. Like I said, we run 100% of our platform on AWS, so the fit was great.

Scale 204

Scale Marketplace as a Service Cloud SaaS Payments 204

OpenView Labs

FEBRUARY 9, 2021

This is why we’re seeing more and more SaaS companies—Datadog, Twilio, AWS, Snowflake, and Stripe, to name a few—find success with product led growth paired with usage-based pricing. But growing with a usage-model is not as straightforward as traditional subscription SaaS. Pick the right usage metric.

Scale 98

Scale Pricing Scaling AWS 98

Clouded Judgement

AUGUST 11, 2023

The hyperscalers (AWS, Azure, GCP) are seeing some uptick, but this is largely from selling compute (ie cloud GPUs). Given most software companies are not profitable, or not generating meaningful FCF, it’s the only metric to compare the entire industry against. However, it’s not showing up in the data yet.

Cloud 130

Cloud Trends Azure GCP(Google Cloud Platform) 130

SaaStr

SEPTEMBER 12, 2019

Ashley Smith, Venture Partner at OpenView provides insight on what investors are looking for in product metrics and growth indicators so you can capitalize on your product’s story for funding. Now I’m investing in that. I enjoyed that weird dynamic of trying to impress them and get them to invest in my company.

Investment 100

Investment Underperforming Technical Team Sales Hiring Software Review 100

Clouded Judgement

MARCH 31, 2023

The majority of COGS (revenue less COGS = gross profit) fall in hosting costs (ie AWS), and some customer support. Given most software companies are not profitable, or not generating meaningful FCF, it’s the only metric to compare the entire industry against. Revenue multiples are a shorthand valuation framework.

Cloud 130

Cloud Sales Hiring AI Headcount 130

Clouded Judgement

FEBRUARY 3, 2023

In the short term, enjoy the ride as the chase continues 😊 Kind of related to all of this - we now have seen the Q4’s from AWS, Azure and Google Cloud. Given most software companies are not profitable, or not generating meaningful FCF, it’s the only metric to compare the entire industry against.

Cloud 130

Cloud Azure AWS Generative AI 130

OPEXEngine

JANUARY 11, 2022

For example, technology companies like AWS, GCP, and Snowflake offer no contracts for customers interested in using their self-service option or beta-testing the solution. Many companies want to migrate their subscription or perpetual business to consumption pricing models; however, it doesn’t always result in incremental business.

Pricing 52

Pricing Payment Solutions Outsourced Development Compensation 52

Frontegg

MAY 27, 2021

Making the bottom-up shift: You are shifting from the top-down to a bottom-up mindset, which means more money and time to invest in R&D efforts. Instead you should focus on Natural Rate of Growth (NRG) to determine the percentage of recurring organic revenue. This metric is a strong future revenue indicator. 6 ChargeBee.

Payment Solutions 98

Payment Solutions SaaS Payments Payments Scale 98

OpenView Labs

MARCH 16, 2021

But the shift from pure subscription to usage-based pricing is nearly as complex as going from on-premise to SaaS. Selecting the right usage metric. There are numerous potential usage metrics that SaaS companies could use in their pricing. Picking the wrong usage metric could have disastrous consequences for long-term growth.

Pricing 52

Pricing Payments SaaS Payments Payment Solutions 52

OPEXEngine

JUNE 29, 2020

Think of it this way: most SaaS companies have high customer acquisition costs, as you have to invest heavily in sales and marketing in order to realize high growth. This signals that the company is strong on both fronts (growth and margin), meaning that it might be an excellent investment opportunity. How does the Rule of 40 work?

Benchmarks 52

Benchmarks SaaS Sales Hiring Scale 52

Chart Mogul

JUNE 23, 2022

This is a perfect time to invest in your user base & core product offering because playing to your strengths will pay off. You might be hard-pressed by your AWS bill but you’re not going to start replacing the engine to lighten the load mid-flight. Here are a few thoughts: 1. Dig Deep Into Your Financials. Further Reading.

SaaS 52

SaaS DevOps as a Service Marketplace as a Service Forecasting 52

SaaStr

APRIL 30, 2022

Check out this 2018 Europa session with Guillaume Princen, Head of France and Southern Europe @ Stripe, where he talks about the metrics you need to be focused on in your startup. If you don’t have the time to watch the whole session, here are the main metrics you should be mindful of. MRR, obviously. Transcript. Hi, everybody.

SaaS Payments 235

SaaS Payments Metrics Payment Methods Scale 235

ProfitWell

MAY 12, 2020

Some SaaS products allow the user to download the application, but require an internet connection to confirm their subscription for it to operate. This option will require significantly more time investment from an IT department than either of the other two options will. We are not considering those in our comparison of cloud services.

Cloud 59

Cloud Azure SaaS Underperforming Technical Team 59

OpenView Labs

FEBRUARY 11, 2021

And yet it’s often tucked away in a financial update while a medley of product metrics enjoy the spotlight. It needs to be treated as a top-level operational metric that a founder must know and understand. As a founder, you can use this 84 cents to pay salaries, office rent, dividends, or invest in R&D.

Scale 52

Scale Payment Methods Payment Services Systems Review 52

Chargify

FEBRUARY 1, 2018

Over the last decade, recurring revenue has emerged as the preferred model for businesses moving beyond transactional commerce. While the first generation of recurring revenue was defined by simple subscriptions—think Netflix’s original “one-size-fits-all” $7.99 From Static Subscriptions To The Relationship Economy.

Subscription 75

Subscription Payment Features AWS Scale 75

SaaStr

JULY 1, 2020

I’m looking at it and I’m like, “Who’s got the Wall Street Journal subscription? For us, it’s been, “Migrate things that you have on invoice over to card.” We can save companies $100,000 on their AWS bill. Everybody wants to save $100,000 on their AWS bill right now.

Merchant Services 188

Merchant Services Scale Sales Recruiting Sales 188

Baremetrics

FEBRUARY 19, 2018

Proper expense categorization improves your visibility into your company’s spending while enabling more accurate metrics and forecasting. As a result, we typically spend the first couple of weeks with a new startup helping their bookkeeper to re-categorize their expenses before we can even begin forecasting or calculating metrics.

Startup 81

Startup DevOps as a Service Customer Lifetime Value SaaS 81

SaaStr

APRIL 24, 2020

John Mellor: But then probably the biggest transition was watching Adobe transition into the subscription business model with its Creative Cloud product as it’s known today. ” Clearly, Wall Street and the Adobe team knew the benefit of a subscription business model and the transition into SaaS. And the stock popped.

Scale 221

Scale Leadership Strategy Technology 221

SaaStr

JUNE 1, 2021

I’m going to skip by my life story, and how I grew up as a small child in India, and how the dusty streets influenced my take on unit economics, and SaaS subscription models. You guys are much more thoughtful around the metrics that you track and knowing that churn and retention is important. Here’s the mistake.

Part-Time VPE 233

Part-Time VPE Technical Cofounder CTO Hire New CTO 233

Outseta

MAY 8, 2020

Invest millions of dollars into growth while running your business at a loss. I can assure you that most people in the tech industry spend countless hours thinking about how to make this happen, investing only a fractional percentage of time thinking about their impact. The lack of self awareness is real.

Part-Time VPE 102

Part-Time VPE Fractional VPE Sales Hiring Underperforming Technical Team 102