October, 2012

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SaaS customer acquisition: Feed it or starve it?

Practical Advice on SaaS marketing

If you manage a software-as-a-service (SaaS) company, at some point you'll be forced to make a tough decision about your customer acquisition process: Feed it or starve it? Should you pony up the money to feed a full-blown sales and marketing effort? Or should you starve the process and keep the cash in your piggy bank? Because of the way the SaaS business model works, if you feed the customer acquisition process, you hurt profits and burn cash.

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The 2nd DO for SaaS startups – Build the right team

The Angel VC

Continuing my little series using the "minimum viable" approach , here is my 2nd DO for SaaS startups: Build the right team I've written about the topic before, so if you've read this post from early this year most of what I'm going to write now won't be new for you and you may want to skip this article. I'm going to assume that you want to build a modern SaaS solution for the "Fortune 5,000,000" – a great product that's easy to understand and so useful that it will almost sell itself.

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B2B Social Business Bill of Rights | Don’t Get it Wrong!

Chaotic Flow

Which is more important in B2B social media, social or media? For way too many B2B marketers, the answer is media. In the B2B marketing community, content marketing has eclipsed blogging, engagement is measured in click-throughs, and gamification is sexier than conversation. Too many B2B professionals see social media as just another marketing communication channel.

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The challenges facing startups serving K-12 education

Tom Tunguz

Ariel Diaz wrote an insightful post in PandoDaily yesterday outlining the state of affairs in online education. Ariel touched on the history of education, catalogued the problems of the status quo and pointed to a few innovative initiatives. Most Edu Innovation is Post-Secondary. Reading the post and reflecting on the startups I’ve seen, I concluded most of the innovation in education has occurred in post-secondary education instead of K-12, despite the fact that the K-12 market is about 50% lar

Education 100
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How Investors & Strategic Buyers Evaluate Integrated Payment Strategies

Explore how integrated payment strategies impact investor and buyer evaluations. Payments are more than a feature — they’re a key to long-term success and market differentiation. They help SaaS companies offer seamless user experiences and efficient operations. Investors and strategic buyers assess these integrated payment strategies as a measure of a company's growth potential and sustainability.

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What Does Your SaaS Agreement Liability Model Look Like?

Aber Law Firm

Don’t be surprised if you don’t totally understand this SaaS agreement question, even though you want to know the answer. Ok, let me explain, and this will (hopefully) become clearer. In every SaaS transaction, the law imposes a liability model that is limited only by what your customer can prove as its damages under contract law. Therefore, each SaaS agreement has an embedded contractual risk/liability model (i.e. limitation of liability clause) that modifies the liability model with the purpo

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Systems thinking for startups

Tom Tunguz

Peter Senge has been called the most influential business strategists of the century and in my view Senge is the successor of Peter Drucker, the management visionary. Senge published a book in 1990 called The Fifth Discipline which I think every manager, founder and CEO should read. Great companies transcend their great products. Not defined by one product, these companies adapt, innovate and reinvent.

Startup 100
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What to look for when hiring a data scientist

Tom Tunguz

Over the last six months, I’ve been delving deeply into R, linear regressions and machine learning. Part of the rationale has been to remember some of the concepts I learned in grad school studying signal processing. But a more important driver has been the need to better understand how to qualify, evaluate and hire data scientists because data science is a massive competitive advantage.

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You want to start a company. Now what?

Tom Tunguz

Last week, a close friend, who is a product manager/designer, told me he’s starting a company. He asked me where I thought the biggest opportunity lay given his skills and his passions. He’s incredibly capable and driven, but he hasn’t yet found the right place to apply his energy. My friend is in search of a problem to solve. He’s in the right place.

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Gigabytes under management

Tom Tunguz

When I walk into a bank today, I might deposit my cash in exchange for some interest rate. The interest rate is my cut of the profits the bank made on my deposit through their trading and lending activities. The more assets under management, the more money a bank can make on its own account. Like banks, web companies are in the business of maximizing gigabytes of user data under management.

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The Big Payoff of Application Analytics

Outdated or absent analytics won’t cut it in today’s data-driven applications – not for your end users, your development team, or your business. That’s what drove the five companies in this e-book to change their approach to analytics. Download this e-book to learn about the unique problems each company faced and how they achieved huge returns beyond expectation by embedding analytics into applications.

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Demo to term sheet in 3 hours

Tom Tunguz

I met the Electric Imp team in April. I had bumped into one of their engineers at a party and he pinged me a few weeks later to say he was working for a startup and the company was raising. The company came in to the office on a Monday at noon. Hugo, the founder, Electric Imp demoed their product to me. Ten minutes in, I stopped the pitch meeting, pulled 3 partners from their Monday partner meeting, and issued a term sheet that afternoon.

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No startup is an island: the three ecosystems startups should develop

Tom Tunguz

It’s tempting to burrow within a garage or basement or apartment to develop a product for several months and emerge from the darkness with a new shiny product. But the launch will likely fall flat. Products must be launched into ecosystems, in particular, into receptive ecosystems. In my view, there are three types of ecosystems that startups should cultivate.

Startup 100
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Culture is the biggest growth driver for social services

Tom Tunguz

Every social service aims to achieve massive growth and deep engagement. But if forced to choose just one of these attributes, I would pick engagement every time. An active user base implies product/user fit for a social service. Aside from the core functionality of social services, which is a solved problem (profiles, messaging, feed), the essence of a social startup is culture - the values of the community, the mores, the manners of interaction.

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The consumer forces shaping enterprise innovation

Tom Tunguz

The first mobile phones were purchased by corporations and given to employees. Thirty years ago, most people used computers at work but not at home. Most of the innovation flowed from the enterprise into the home. Today, it’s very much the opposite. The big trends in enterprise trace the opposite movement both at the software layer and the device layer: consumerization of IT means using consumer channels to acquire customers and bring your own device (BYOD) means 66% of employees bring their own

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Crafting Tomorrow: A to Z of Delighting Customers with Your Product

Ready to build game-changing software fast? Trigent's eBook, "Crafting Tomorrow," unlocks the secrets. Entrepreneurs, product managers, and developers: it's time to bring your vision to life. Tech Accelerator: An on-demand ninja team ready to ideate, validate, iterate, and propel your product at every stage. Master the Product Life Cycle: Identify problems, build solutions, launch, scale, and optimize with confidence.

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Data science in freemium businesses

Tom Tunguz

Freemium businesses' marketing techniques are immensely powerful. They drive large amounts of users to try a product and convert some small fraction of those to paid, upending the enterprise sales model. In some sense, freemium businesses are real world Monte Carlo simulations. Because of the large volume of users using the product, freemium businesses can generates gigabytes of interaction data and conversion-to-paid data, which makes these kinds of startups particularly well suited to data sci

Data 100
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Faking it + grit + inspiration = ?

Tom Tunguz

In Silicon Valley, we cherish stories of great struggles, persisting failure, and grind-your-teeth kind of grit that eventually leads to great success. These stories are our collective folklore. Today, I want to highlight one of these stories. Amy Cuddy gave a TED talk on how body language shapes who we are and our career trajectories. Her story is insightful, motivational, and electrifying.

Startup 100
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Four lessons for optimizing Twitter

Tom Tunguz

Over the weekend, I analyzed my Twitter performance over the past 4 weeks. I wanted to determine what if any best practices I could tease from the data. Below are my four conclusions: The best time for me to tweet is 9am Pacific. On average, tweets at 9am generate 2.3 times the number of clicks as those in the 8am hour and 3.3 times those of the 12pm (lunch) hour.

Data 100
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Understanding payments

Tom Tunguz

The payments ecosystem is complicated. But FastCompany constructed an illuminating diagram walking through a typical payments flow that I’ve copied here. Just look at all those steps! Simplifying this complexity is the opportunity for many startups like Stripe, Dwolla and others.

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Driving Growth, Customer Satisfaction, and Retention through Usage-Based Pricing

As companies strive to boost revenue, deliver customer value, and stay competitive, they are increasingly embracing the potential of usage-based pricing.

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Entrepreneurship growth: perception vs reality

Tom Tunguz

The flurry of media activity in entrepreneurship including the spate of new TV shows like X-Factor for tech and Shark Tank, the refocus of the NYTimes and WSJ on technology, and the number of entrepreneurs on mainstream magazine covers gave me the impression that entrepreneurship is on the rise. While this may be true in pockets like New York or California, entrepreneurship in the US is shrinking - at least according to the Bureau of Labor Statistics and a report from the NYTimes: When Job Creat

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Founders, teach your employees statistics

Tom Tunguz

Everyone is learning statistics because making sense of data is the difference between success and failure. R, the open source statistics language, is about a third as popular as Ruby and growing fast. Statistics are essential because data is ubiquitous and volumes are growing exponentially, even in startups. CEOs measure key company metrics. Engineers measure application performance and build machine learning models.

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My approach to building a hiring pipeline

Tom Tunguz

Over the last few months, I’ve been helping a few companies build hiring pipelines to recruit at nearly every experience level and for technical, sales and business development roles. Below are the lessons I’ve learned. Identify your ideal candidate. If you don’t know where you’re going, any road will take you there. Narrow your search focus to find the right candidate.

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Sushi, passion, and entrepreneurship

Tom Tunguz

Passion is not something you follow. It’s something that will follow you as you put in the hard work to become valuable to the world. Follow a Career Passion? Let It Follow You. In his book “So Good They Can’t Ignore You”, Cal Newport, a college classmate, champions the idea that passion lags work, instead of passion inspiring work. It’s the same philosophy embraced by sushi master Jiro, in the documentary “Jiro Dreams of Sushi.

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Addressing Top Enterprise Challenges in Generative AI with DataRobot

The buzz around generative AI shows no sign of abating in the foreseeable future. Enterprise interest in the technology is high, and the market is expected to gain momentum as organizations move from prototypes to actual project deployments. Ultimately, the market will demand an extensive ecosystem, and tools will need to streamline data and model utilization and management across multiple environments.

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What Does Your SaaS Agreement Liability Model Look Like?

Aber Law Firm

Don’t be surprised if you don’t totally understand this SaaS agreement question, even though you want to know the answer. Ok, let me explain, and this will (hopefully) become clearer. In every SaaS transaction, the law imposes a liability model that is limited only by what your customer can prove as its damages under contract law. Therefore, each SaaS agreement has an embedded contractual risk/liability model (i.e. limitation of liability clause) that modifies the liability model with the purpo

SaaS 52
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What Does Your SaaS Agreement Liability Model Look Like?

Aber Law Firm

Don’t be surprised if you don’t totally understand this SaaS agreement question, even though you want to know the answer. Ok, let me explain, and this will (hopefully) become clearer. In every SaaS transaction, the law imposes a liability model that is limited only by what your customer can prove as its damages under contract law. Therefore, each SaaS agreement has an embedded contractual risk/liability model (i.e. limitation of liability clause) that modifies the liability model with the purpo

SaaS 40
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What Does Your SaaS Agreement Liability Model Look Like?

Aber Law Firm

Don’t be surprised if you don’t totally understand this SaaS agreement question, even though you want to know the answer. Ok, let me explain, and this will (hopefully) become clearer. In every SaaS transaction, the law imposes a liability model that is limited only by what your customer can prove as its damages under contract law. Therefore, each SaaS agreement has an embedded contractual risk/liability model (i.e. limitation of liability clause) that modifies the liability model with the purpo

SaaS 40
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What Does Your SaaS Agreement Liability Model Look Like?

Aber Law Firm

Don’t be surprised if you don’t totally understand this SaaS agreement question, even though you want to know the answer. Ok, let me explain, and this will (hopefully) become clearer. In every SaaS transaction, the law imposes a liability model that is limited only by what your customer can prove as its damages under contract law. Therefore, each SaaS agreement has an embedded contractual risk/liability model (i.e. limitation of liability clause) that modifies the liability model with the purpo

SaaS 40
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Software Composition Analysis: The New Armor for Your Cybersecurity

Speaker: Blackberry, OSS Consultants, & Revenera

Software is complex, which makes threats to the software supply chain more real every day. 64% of organizations have been impacted by a software supply chain attack and 60% of data breaches are due to unpatched software vulnerabilities. In the U.S. alone, cyber losses totaled $10.3 billion in 2022. All of these stats beg the question, “Do you know what’s in your software?

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What Does Your SaaS Agreement Liability Model Look Like?

Aber Law Firm

Don’t be surprised if you don’t totally understand this SaaS agreement question, even though you want to know the answer. Ok, let me explain, and this will (hopefully) become clearer. In every SaaS transaction, the law imposes a liability model that is limited only by what your customer can prove as its damages under contract law. Therefore, each SaaS agreement has an embedded contractual risk/liability model (i.e. limitation of liability clause) that modifies the liability model with the purpo

SaaS 40
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Great products turn motivation into capability

Tom Tunguz

Examining a user’s motivations at the entry point of every major feature in a product and matching the product to this motivation is key to building a great product users love. BJ Fogg’s Behavior Model Theory is a succinct summary of this idea in a formula: Motivation + Trigger + Ability = Behavior. This model says that a user will perform a behavior when given the means, the motive, and the opportunity.

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Learning from Amazon’s Startup Judo

Tom Tunguz

This week Amazon made public its advertising initiatives. Given the massive trove of invaluable purchasing data Amazon collects, I’m certain Amazon could build a rival to AdSense. But they aren’t. Below is a quote from an interview with Lisa Utzschneider , the head of Amazon Media Group: Q: Can you give us a sense of how important advertising is to Amazon?

Startup 100