Sales Hacker

JULY 14, 2023

I sometimes see companies put a large % on closed won revenue and I’m not a fan. Do you have any suggestions for structuring an incentive package to optimize for sales/revenue efficiency?” I was heavily incentivized to move the share price. LTV/CAC has SO many moving parts that it’s only partially influenced by the CRO.

Compensation 52

Compensation Sales Hiring Technical Review Metrics 52

Andreessen Horowitz

NOVEMBER 1, 2023

One of the most common pricing questions we get from late-stage SaaS companies is: should we switch to a usage-based pricing model (also known as consumption-based pricing)? After all, the more their customers use their product, the more revenue they capture. How will you compensate your reps?

Pricing 102

Pricing Compensation Subscription Payment Features 102

Tom Tunguz

NOVEMBER 24, 2018

You might have a few account executives and a sales leader in place; maybe some revenue and a handful of customers. In the very earliest stages, the company doesn’t know how to sell or how to price. The most important goal isn’t price maximization, but just closing some business. Stage 1: Management by Objectives.

Compensation 153

Compensation Sales Recruiting Sales Hiring Scale 153

SaaStr

FEBRUARY 2, 2024

” There were no IPOs from December 2021 until Klaviyo a couple of months ago, but even Klaviyo still barely IPO’d at 800 million in revenue. They’ll have much more budget than the rest of us, and it will warp and distort sales compensation this year. #4. HashiCorp went public but it all stopped after that.”

Sales Recruiting 290

Sales Recruiting Trends Sales Hiring Software Review 290

SaaStr

OCTOBER 10, 2023

Let’s look at the pros and cons Founder-led Sales Pros: Flexibility as a founder in terms of how you craft messaging, pricing, etc. Early first-hand knowledge leads to rapid fixes to the product, pricing, and packaging. On the flip side of revenue growth, you don’t want the bottom to fall out of your customer base.

Scale 207

Scale Sales Hiring Scaling Sales 207

FastSpring

AUGUST 3, 2022

I spoke with FastSpring’s former VP of Revenue Operations about this, and you can stream our entire conversation at the bottom of this piece. You don’t always have time to compensate for unexpected events in your market, but the key is to speed up how quickly you can measure the impact of the investments you’re making today.

Scale 116

Scale Revenue Sales Compensation 116

Sales Hacker

MAY 9, 2019

A great sales compensation plan needs to accomplish quite a lot. It needs to provide fair compensation to employees in customer-facing roles. The Process for Creating a Sales Compensation Plan. Plan Compensation for Onboarding and Training. Example Compensation Plans. Establish Role Levels. Keep it Simple.

Compensation 102

Compensation Sales Hiring Development Team Review Sales Recruiting 102

Tom Tunguz

FEBRUARY 17, 2022

The greater the revenue, the more likely the acquirer prices a target on a revenue multiple. The essential components of a merger term sheet often include: price: the amount and the structure (cash vs stock; merger or asset purchase). executive compensation: especially equity revesting.

Technical Review 278

Technical Review Construction Compensation Acquisition 278

Tom Tunguz

JUNE 21, 2022

In addition, Lee shared his view on usage-based pricing and defending a startup’s great asset, talent, from poaching during the next recovery. Usage-Based Pricing. Twilio was one of the pioneers of usage-based pricing. Gross profit equals revenue minus COGS. Contracted revenue constituted less than 50% of ARR.

Startup 168

Startup Outsourced Development Sales Hiring Compensation 168

SaaStr

NOVEMBER 24, 2021

However, even the savviest entrepreneurs might be unaware of some of the blind spots that could be costing revenue. . It’s 2021, but surprisingly, a significant number of SaaS companies still use outdated sales compensation plans. Pothole #2 – Increasing Pricing Rate Without a Sustainable Moat. Copy your entire product.

Sales Hiring 196

Sales Hiring Scale Compensation Sales 196

OPEXEngine

JANUARY 11, 2022

Consumption-based pricing is best used when you can accurately and easily break down your service offering into small, digestible units. Many companies in the technology industry are moving toward “pay for what you use” consumption-based pricing models. Four pricing models. Challenges and shifts. New coverage models.

Pricing 52

Pricing Payment Solutions Outsourced Development Compensation 52

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. Usage-based pricing will be the key to successful monetization in the future.”. Usage-based pricing is in all layers of the tech stack.

Scale 98

Scale Pricing Scaling AWS 98

SaaStr

OCTOBER 29, 2019

SaaS is about creating long-term value for your customer, and being compensated appropriately for that value as a business. 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. The next camp, we price it artificially low.

Payments 100

Payments Pricing Compensation SaaS Payments 100

OpenView Labs

APRIL 8, 2021

The response since the usage-based pricing playbook has far exceeded my expectations. My TechCrunch byline went semi-viral, Bessemer named usage-based pricing part of the “ new normal ” for SaaS go-to-market strategy, and Alex Wilhelm said it’s “ one theme that’s come up time and again ” in public company earnings calls.

Pricing 97

Pricing Scale Subscription Payment Features 97

Baremetrics

JANUARY 10, 2022

Optional product pricing is a pricing strategy whereby the core component of a product is sold for a basic price, and a menu of complementary services are offered for a separate fee. Optional product pricing often employs the concept of a loss leader. What is optional product pricing? Table of Contents.

Pricing 98

Pricing Airlines Systems Review Outsourced Development 98

SaaStr

MAY 12, 2022

Their specific and single pricing and packaging model was no longer supportable or sustainable. Usage-based economics is different from traditional subscription-based economics because of how you generate revenue. The gym recognizes the revenue when the customer comes in and uses the facilities. . Take the example of a gym.

Scale 242

Scale Payments SaaS Payments Payment Services 242

Clouded Judgement

JANUARY 19, 2024

The answer is they may, but just at a different price / valuation. One thing I do want to call out that I don’t see tracked enough is stock compensation. Revenue multiples are a shorthand valuation framework. Multiples shown below are calculated by taking the Enterprise Value (market cap + debt - cash) / NTM revenue.

Cloud 177

Cloud Scale Compensation Metrics 177

OpenView Labs

SEPTEMBER 8, 2021

2021 has proven to be the year of usage-based pricing. . 45% of expansion stage SaaS companies now say they have a usage-based or consumption-based pricing model, according to data from OpenView’s forthcoming 2021 Finance and Operations benchmarks report. . Product: Treat product investments as a revenue-generating expense.

Pricing 64

Pricing Customer Success Scale Compensation 64

OpenView Labs

OCTOBER 6, 2021

The stock price continued to surge post-IPO, quadrupling in value between 2015 and 2018. . New Relic’s stock price plunged 29% in a single day following the earnings call. Introducing a new (and generous) perpetual free pricing tier. Shifting from subscriptions to a new consumption-based pricing model.

Pricing 81

Pricing Scale Compensation Subscription 81

SaaStr

SEPTEMBER 29, 2022

A few thoughts on retention compensation when you are acquired. Extra payments if your business hits $YYm in revenues. But the sticks come out of the purchase price. Dear SaaStr: How Do I Do My Retention Negotiation in an Acquisition? Even if they haven’t told you yet. You stay 12-24-36 months, we pay you $X. Time-based.

Acquisition 259

Acquisition Retention Payments Compensation 259

Kellblog

JUNE 4, 2023

There may be a services relationship (channel) where the GSI agrees to use the vendor’s strategic consultants, acquired at a wholesale price, blended into the team responsible for a project (and in order to ensure there is specific product expertise on the team). There are 3 keys to channel partner pricing. starter kits).

Sales Recruiting 108

Sales Recruiting Compensation SaaS Sales Hiring 108

ChurnZero

JULY 8, 2022

Net revenue retention (NRR) is taking center stage as the qualifying metric for determining the health of a SaaS business. Net revenue retention defined. NRR is the cumulative total of your retained, contracted and expanded revenue over a period, typically a month or year. How can you increase net revenue retention?

Technical Review 98

Technical Review Software Review Retention Metrics 98

OpenView Labs

MARCH 16, 2021

The usage-based pricing model almost feels like a cheat code —it enables SaaS companies to more efficiently acquire new customers, grow with those customers as they’re successful, and keep those customers on the platform. But the shift from pure subscription to usage-based pricing is nearly as complex as going from on-premise to SaaS.

Pricing 52

Pricing Payments SaaS Payments Payment Solutions 52

SaaStr

MARCH 12, 2019

He provides an in-depth guide to driving revenue growth at your company and what to expect at each stage. Awesome revenue growth on the X axis, awesome revenue retention on the Y. Hundred percent revenue retention, 200% revenue growth. Thirty, 50% revenue growth. How fast you’re growing revenue.

Scale 213

Scale Sales Hiring Revenue VP of Engineering 213

Tom Tunguz

SEPTEMBER 6, 2021

revenue /ebitda. These new shares are often granted to employees as compensation. If I work on behalf of a crypto company, I receive tokens as part of my compensation. Most companies in the public market are valued on revenue or EBITDA; if revenue increases, so does the value of the stock. Property/ Asset.

Government 234

Government Compensation Blockchain Banking 234

SaaStr

AUGUST 29, 2022

10.000 SaaS CEOs, Founders, Revenue Leaders, and VCs will join us for 3 days of tactical content, networking, and epic evening events when the Cloud comes to San Mateo. Scaling Revenue in 2022: What’s the Same and What’s Different? If you haven’t already, sign up here for tickets before we sell out.

Scale 251

Scale Sales Hiring Marketplace as a Service B2B 251

User Pilot

MARCH 25, 2024

An accurate valuation is necessary to secure the right price for the company or adequate funding without diluting its share value. It uses revenue and operating costs to determine the company’s value. The multiple depends on numerous factors, like sustainability and transferability of revenue and growth.

SaaS 88

SaaS Customer Lifetime Value Acquisition Metrics 88

Incredo

OCTOBER 17, 2019

is like asking “how expensive should I price my SaaS product?” What are 5 common SaaS sales compensation models? The reason is that commission-only position doesn’t guarantee a fixed financial compensation at the end of each month. Asking “what’s the typical commission for SaaS salesperson?” See below!

SaaS Payments 150

SaaS Payments Compensation Payment Services Sales Recruiting 150

SaaStr

OCTOBER 3, 2022

When approaching a GTM exercise, one thing needs to be very clear: the company’s revenue strategy. This revenue strategy consists of three core questions: What is the market opportunity—the problem that needs to be solved? What is the pricing? On top of all this, build a compensation structure to drive desired behavior.

Scale 223

Scale Sales Hiring Sales Recruiting Scaling 223

Tom Tunguz

OCTOBER 14, 2015

The purpose of a price is to tax usage of a product. That’s how companies generate revenue. Complex or unintuitive pricing model. Complex or unintuitive pricing model. A good pricing model appears simple and logical to the customer. Often for applications, it’s people - hence a pricing model by seats.

Pricing 100

Pricing Startup SaaS Compensation 100

Incredo

OCTOBER 17, 2019

is like asking “how expensive should I price my SaaS product?” What are 5 common SaaS sales compensation models? The reason is that commission-only position doesn’t guarantee a fixed financial compensation at the end of each month. Asking “what’s the typical commission for SaaS salesperson?” See below!

SaaS Payments 144

SaaS Payments Compensation Payment Services Sales Recruiting 144

Kellblog

AUGUST 7, 2019

I’ve been asked about this a few times lately, less because people value my accounting knowledge [1] but rather because people are curious about the CAC impact of such deals and how to compensate sales on them. Equal Value: The Price-Ramped Deal. Price-Ramped). GAAP revenue. $1M. GAAP unbilled deferred revenue. $5M.

Deferred Revenue 74

Deferred Revenue Pricing Payments SaaS Payments 74

Kellblog

JANUARY 2, 2024

The bloom comes off the consumption pricing rose. I’ve always felt the famous Warren Buffet quote applies to consumption-based pricing: “when the tide goes out you can see who’s swimming naked.” The Reprise of Repricing Compressed valuation multiples and reduced growth mean lower stock prices. The Year of Efficient Growth. 

AI Search 108

AI Search Technical Review Technical Advisors ChatGPT 108

OpenView Labs

MARCH 18, 2020

In this uncertain environment, how should one approach pricing? For pricing, this means no price gouging. Price helps anchor your value, and price discounts made during a crisis tend to stick and can reset value perceptions long term. If you don’t already have one, add a usage component to your pricing model.

Pricing 57

Pricing Payment Solutions Payments Healthcare 57

SaaStr

JULY 23, 2020

The average package price is USD 500 for subscription/month. So the commission might be say $600 until they’ve close enough revenue to cover their base. A bit more here: The ultimate guide to SaaS Sales Compensation Plan | SaaStr. Q: What is a good model for SaaS product sales commission? Often at roughly at 50/50 ratio.

Scale 173

Scale Compensation Subscription Payment Features 173

SaaStr

MARCH 8, 2021

The average package price is USD 500 for subscription/month. So the commission might be say $600 until they’ve closed enough revenue to cover their base. A bit more here: The ultimate guide to SaaS Sales Compensation Plan | SaaStr. Q: What is a good model for SaaS product sales commission? Often at roughly a 50/50 ratio.

Scale 165

Scale Sales Compensation Churn 165

SaaStr

MAY 14, 2023

Algolia went from zero to seven figures in revenue in 12 months, and the launch of their search as a service product, and grew pricing from $19 a month to $100,000, which sounds amazing. Nicolas : Really, one step at a time, so we knew the first pricing was just testing the market, and we iterated a lot on it. CEO of Algolia.

Sales Hiring 242

Sales Hiring Sales Recruiting Scale Payment Methods 242