SaaStr

JUNE 2, 2022

You can see here even in June ’09, the peak of that recession arguably, we doubled sales over ’08: #2. Two things though did get hit harder — SMB Churn and Upsell s. Customers kept buying more SaaS than ever, which masked all-time high churn in SMB accounts. That never even slowed down.

SMB 316

SMB SaaS Churn Enterprise 316

SaaStr

MARCH 12, 2023

Check out this week’s top blog posts, podcasts, and videos: Top Blog Posts This Week: The Challenge with SMB SaaS: High Growth Can Only Mask High Churn For Just So Long (Updated) The 8 Signs of a Failing Sales Rep. SaaStr 639: Scaling a SaaS Sales Team While Building Culture with Figma VP of Sales Scott Pugh    4.

Scale 204

Scale SMB Sales Scaling 204

SaaStr

DECEMBER 3, 2023

E.g.,: CAC of < 12 months is Good-to-Great Paying sales reps 25%-30% of what they close is Good A burn ratio of 1 or less is Good These metrics do sort of work, if you have some capital to spend (i.e., SMB SaaS often has much lower than 100% NRR, especially to start. can invest in marketing that takes a little while to pay off).

SaaS Payments 211

SaaS Payments Metrics Payments SMB 211

SaaStr

FEBRUARY 9, 2024

Everything from hiring on the GTM side to layering in a sales-led motion into PLG. Let’s dive into what’s making that hybrid model successful: PLG and Sales Led? Given this, you must understand the role that each facet of the business plays in promoting that product, from marketing and sales to customer service.

Scale 269

Scale Sales Hiring Sales Marketing 269

SaaStr

JUNE 8, 2022

ARR, Zoom was an SMB powerhouse, with Enterprise growing. SMB is now saturated at $4B ARR and not growing, but Enterprise is picking up the slack and growing faster than ever. Sales & Marketing Spend Still Tiny at 25%, But Up From 20% As Zoom Goes More Enterprise. ARR … which it did in just 1 year (!!)

SMB 285

SMB Enterprise Engineering Scale 285

SaaStr

DECEMBER 26, 2020

Even once you hit just $2m-$3m ARR — fairly early — the trade-offs start to become clear for startups with customers both Smaller and Larger: Small customers consume just as many sales, success, and marketing resources. Small customers churn at a much higher rate. Small customers are great for training the sales team.

SMB 352

SMB Sales Hiring Marketing Enterprise 352

SaaStr

JANUARY 2, 2021

We can see that NRR for tiny customers is probably about 100%, as it is for other SMB leaders. Again, the latest crop of Cloud IPOs shows SMBs seem to have no limit in terms of TAM, with SMB growth at Shopify and Zendesk keeping up with enterprise, and even at Asana, SMB growth is still impressive at $250m ARR.

SMB 347

SMB Enterprise Cloud Churn 347

SaaStr

JULY 22, 2021

It’s in many ways the hardest way to do it (direct sales to SMEs), but like HubSpot, Avalara has made it work well. They earn commissions and are offered dedicated sales, marketing and training support. We’ve seen this with sales-drive SMB and SME leaders like Xero as well. And growth is strong. market cap.

Scale 323

Scale SMB compliance Churn 323

SaaStr

JANUARY 12, 2021

and (y) a complex sales process with sales reps selling to very small businesses not paying all that much. A tough way to build a decacorn — sales-driven very small-business sales — but they’ve done it, so there’s a lot to learn here. Churn is 1.1% Xero’s SMB churn isn’t zero.

Customer Lifetime Value 230

Customer Lifetime Value SMB Churn Scale 230

SaaStr

SEPTEMBER 17, 2023

LIVE from Annual Stage A Masters: How Revenue Leaders at Box, Calendly, and Lattice Created Sales Acceleration Moments The post Top SaaStr Content for the Week: Craft Ventures’ Founder & General Partner, QED’s Partner, Y Combinator’s Managing Director and lots more! The Next Best in About 5 Years.

Scale 224

Scale Management SMB AI 224

SaaStr

JANUARY 24, 2024

How do you diagnose and solve churn? Sales reps were hosting 4-6 calls daily but most of these calls were early demos or top-of-funnel discovery calls Sales was closing really small deals on one end while talking to really large companies with hundreds of thousands of people on the other. Can you start and stop a PLG motion?

Scale 235

Scale Sales Hiring Scaling Revenue 235

SaaStr

OCTOBER 2, 2022

Check out this week’s top blog posts, podcasts, and videos: Top Blog Posts This Week: Why Your Cost of Sales Generally Doubles As You Scale. The Challenge with SMB SaaS: High Growth Can Only Mask High Churn For Just So Long (Updated). The Best in SaaS Are Just Growing Faster Than Ever.

Cloud 263

Cloud Scale SMB B2B 263

SaaStr

SEPTEMBER 26, 2019

What we learned from ’08-’09 in SaaS: First, SMB churn went through the roof — as SMBs went under much more quickly and often. As soon as the economy went south, SMBs started to simply go bankrupt and/or shut down. Anyone processing a lot of SMB and credit-card deals saw churn probably double.

SaaS Payments 278

SaaS Payments Sales Hiring Scale SMB 278

SaaStr

APRIL 24, 2022

BowtiedCocoon: Top SaaS SMB AEs have $125k OTEs. Don’t Hire a VP of Sales Everybody Loves. SaaStr 548: How to Build a Super High-Retention Sales Team with Twilio SVP & GM of North America Sales, Alice Katwan. Check out this week’s top blog posts, podcasts, and videos: Top Blog Posts This Week: 1.

Sales Hiring 276

Sales Hiring Revenue Scale SMB 276

SaaStr

FEBRUARY 16, 2021

Q: What are the common mistakes in B2B sales in the early-ish days? The list could be endless, and it can vary a lot based on type of customer, type of sale, etc. The list could be endless, and it can vary a lot based on type of customer, type of sale, etc. No prospect enjoys going through a sales process for fun.

Scale 199

Scale Sales Hiring Sales SaaS 199

SaaStr

APRIL 13, 2023

And so many different strategies, from more enterprise to more SMB, from more tech focused (Asana) to less tech focused (Monday). 135% NRR from larger customers and 120% for $5k+ customers remains top-tier, especially for a vendor with plenty of small SMB customers. You can just learn so much. Wow, what a story!

SMB 245

SMB Outsourced Development Enterprise Scale 245

SaaStr

MAY 19, 2019

What lessons can we learn from this huge Kiwi SMB success, for other founders? ” So even in SMB sales in smaller markets, if you take dominant market share — you can get to $500m+ in ARR! ” So even in SMB sales in smaller markets, if you take dominant market share — you can get to $500m+ in ARR!

SMB 221

SMB Customer Lifetime Value AWS Churn 221

SaaStr

SEPTEMBER 29, 2022

Channel model and organic approach to SMB and mid-market yields a fairly efficient Sales & Marketing motion. JFrog does have a significant dedicated sales team, but mainly focused on $100k+ deals. Together, it means they only spend 38% of revenue on Sales & Marketing. We’ve seen this before.

Scale 240

Scale SMB Software Development Cloud 240

SaaStr

APRIL 4, 2023

How CAC targets drive GTM strategies: If Your CAC Target Is Low You’ll likely focus on small-to-medium businesses and use tools like inbound sales and low-touch or no-touch self-service. The sales cycle at this stage may be very short. The sales cycle will be slightly longer at this stage. But over time, things change.

Scale 234

Scale Strategy Scaling Outbound Sales Team 234

SaaStr

MAY 25, 2020

I recently put out a call on Twitter and LinkedIn on folks’ top tip to take friction out of their sales processes. “Presumptive close in a transactional sale. “At “Help people buy how they want to buy and be as transparent as you can with pricing ” – Ken Edwards, Sales leader, Uberflip.

Sales Hiring 338

Sales Hiring Sales Outsourced Development Technical Review 338

SaaStr

JANUARY 4, 2023

A nice sweet spot for a mix of inside and outside sales. #3. Okta is seeing higher SMB churn and more ROI scrutiny, but is also benefitting from some customers wanting to centralize on fewer core vendors. Okta has done an excellent job at keepings its NRR at 122%-123% all the way to $2B in ARR. Wow what a story!

Scale 288

Scale Headcount Sales Hiring SMB 288

SaaStr

JUNE 29, 2022

It’s moved beyond its tiniest customers, of an ACV of < $1k, but other than that, it’s going upmarket without giving up its SMB roots. Even though Zendesk still has thousands and thousands of SMB customers. #2. Zendesk IPO’d as an SMB support solution. At $1B in ARR, Zendesk was growing 24%.

SMB 271

SMB Scale B2B Metrics 271

SaaStr

NOVEMBER 6, 2022

Most SMB SaaS apps are really ERP 2.0 But it ain’t an Instagram-like deployment, even in an SMB. Oftentimes, post-sale, your customer success team will spend a huge amount of time with these folks. Yes, this will help with churn. . — the things that many of our apps do — is a big deal. And a lot of work.

Business 269

Business B2C SMB Customer Success 269

Tom Tunguz

MAY 5, 2013

Kenny van Zant drew this diagram for me on white board and I think it’s the best visualization of how SMB SaaS freemium business grow. The diagram highlights a few important mechanics of the SMB SaaS business model. A few of these customers grow into SMBs and become paying customers - they cross the dashed line in this diagram.

SMB 100

SMB Scale SaaS Mobile 100

SaaStr

APRIL 7, 2021

1. “SaaStr 417: How Sales and Product Really Should Work Together with Javier Molina, VP, Corporate Sales, Americas @ MongoDB and Sahir Azam, Chief Customer Officer” A super important topic we don’t hear discussed enough. #2. And how to win in a very competitive market. #7.

Scale 164

Scale SMB Churn Scaling 164

SaaStr

MAY 25, 2022

Fast forward to today, they are now crossing $500,000,000 in ARR growing modestly but consistently at 14% Year-over-Year: They’re also a case study of sloooowly going upmarket from the original PLG SurveyMonkey self-serve days to a sales-driven motion and product. 700 of 2,100 sales-assisted customers use multiple products.

Scale 247

Scale Payments Payment Solutions Payment Services 247

SaaStr

JUNE 27, 2019

This removes friction from the sales process, leading to a higher and faster close rate. It may be the most successful SMB-focused app of our current generation. Yes, nominal churn may seem lower by removing a monthly option. If they churn at the end of a yearly subscription, or 6 months into a monthly one, they’re still gone.

Pricing 177

Pricing SaaS Payments Payment Solutions Payment Services 177

SaaStr

OCTOBER 17, 2022

Inexperienced sales reps or those used to doing SMB sales often try a magic, big discount to get an enterprise deal to close more quickly. One of the top ways to drive down churn is to make sure your customers deploy your app for real as fast as possible. It’s part of sales, up to a point. But also really ask.

Scale 236

Scale SMB Enterprise Churn 236

Baremetrics

JANUARY 24, 2021

Anyone managing a SaaS or subscription business is aware of customer churn. That means achieving any essence of “growth” requires replacing lost customers faster than the rate at which they churn. Managing churn is much like a constant game of plugging holes in a bucket so that you can eventually have a “rising tide” of water.

Churn 71

Churn SaaS Payments Payment Methods Payment Solutions 71

Sales Hacker

SEPTEMBER 25, 2019

In June, CNBC reported that recently listed cloud software companies were getting crushed for poor sales execution. Enterprise sales is hard, which is why most businesses start as an SMB org and grow into an enterprise org. 2 rules for transitioning from SMB to enterprise. Today, enterprise sales is harder than ever.

SMB 73

SMB Enterprise Strategy Compensation 73

SaaStr

MARCH 19, 2021

A head of sales that doesn’t recruit at least one strong rep in the first 90 days. A head of customer success that doesn’t own churn, or net revenue retention in the first 90 days. I can go on. A VP of Sales that has never done outbound, if they don’t take it on fairly early — they never really will.

Sales Recruiting 327

Sales Recruiting Sales Hiring SMB Engineering 327

SaaStr

APRIL 14, 2023

If you aren’t sure if you have a rock-solid value prop, look at churn, revenue, and even the ability or inability to raise funds. Investors want to know about metrics, the drivers of your business, and whether users are growing, engaged, or churning. Enterprise will likely have a different problem set vs. an SMB. Absolutely.

Development Team Review 228

Development Team Review Technical Review Underperforming Technical Team SMB 228

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. New Relic’s net negative churn / net dollar retention has dropped to 98% in the last quarter, despite a record 77% of revenue being from the enterprise.

Scale 308

Scale Outsourced Development SMB Cloud 308

SaaStr

NOVEMBER 22, 2020

Measure leading indicators and not lagging indicators like churn. Determine if your growth is product-led, sales-led, or marketing-led. Determine if your company is direct vs. indirect sales-led for tech alliances, channels, and Student Information Systems. This stage includes companies with sales between $25M and $75M.

Scale 311

Scale Scaling Technical Review Systems Review 311

SaaStr

JULY 14, 2020

With SaaS sales, annual price or monthly price that’s billed annually? This removes friction from the sales process, leading to a higher and faster close rate. It may be the most successful SMB-focused app of our current generation. Yes, nominal churn may seem lower by removing a monthly option.

Pricing 230

Pricing Payment Solutions Scale SaaS Payments 230

SaaStr

DECEMBER 3, 2021

. #9 SaaStr 150: Why New Qualified Leads Divided By Win Rate Is The Metric in SaaS, Why It Is Harder To Go Enterprise Down Than SMB Up & How To Create Engines of Growth Within Your Organization with Paul Albright, Former CRO @ Marketo. #8 1 SaaStr 221: HBS Sr. . #8 1 SaaStr 221: HBS Sr. . #6 1 SaaStr 221: HBS Sr. . #3

Scale 208

Scale Sales Hiring SMB Benchmarks 208

SaaStr

DECEMBER 5, 2023

By going upmarket, you can land bigger deals with more opportunities to upsell and lower churn. As Managing Director of Salesforce Ventures, Nowi Kallen , shared at last week’s Workshop Wednesday, there are five main challenges of moving upmarket and tips to follow if you want to succeed at Enterprise sales in today’s macro environment.

Scale 195

Scale Enterprise readiness compliance Enterprise 195