Tom Tunguz

JULY 21, 2022

” This sentence echoes in conference rooms across many software buyers today, irrespective of whether the business is healthy. Management teams expect to reduce operating expense by 20% predominantly through headcount reductions or hiring freezes - everyone from sardine startups to public megalodons. Software does more with less.

Sales Hiring 190

Sales Hiring Headcount Software Finance 190

Tom Tunguz

DECEMBER 6, 2022

Profitability or net income margin has become the most important correlate to public software company valuations. Across every quartile, public software & infrastructure companies have seen a 5 percentage point drop in net income since Covid. Sales-lead teams cut headcount when account executives don’t attain numbers.

Headcount 344

Headcount Market Research Acquisition Education 344

Tom Tunguz

JUNE 20, 2020

We can derive the table above if we look over the entire respondent base and bucket headcount by ARR. Software companies invest in engineering early and then the product matures, complement that engineering and product investment with go to market teams to commercialize the product.

Scale 363

Scale Scaling Sales Hiring Software Review 363

Tom Tunguz

JUNE 1, 2023

Sales development, content marketing, & software engineering strike me as the workstreams that will benefit immediately. There will be exceptions, especially where a user base is predominantly individual users or the willingness to pay for the software outweighs the productivity gains. Content marketing 30% 5% 1.5%

AI 322

AI Startup Scale Headcount 322

SaaStr

NOVEMBER 22, 2023

There are several big leaders in property management software, and AppFolio is one of them. At $660m in “ARR” (a lot of that isn’t software, as we’ll see below), it’s trading at a $7.2 AppFolio is what the markets want in a software+ company, at least in 2023. Let’s dig in.

Payment Services 289

Payment Services Payment Solutions SaaS Payments Payments 289

SaaStr

JULY 31, 2020

Last year, the company doubled its headcount, tripled revenue and landed on G2’s Top 100 Global Software list. . And some of the marquee customers include MongoDB, Gitlab and Qualtrics. . The funding comes at a point when Chorus is in the hypergrowth mode.

Scale 359

Scale Artificial Intelligence Payments Payment Services 359

Tom Tunguz

JULY 10, 2024

Pricing an AI product will be a defining question in software for the next few years. But greater productivity may reduce the demand for seats over time, ultimately decreasing the size of software markets. AI products offer productivity gains. Company Product Base Price AI Price Ratio Github Github Enterprise 21 10 0.67

AI 277

AI Pricing Sales Hiring Strategy 277

SaaStr

APRIL 13, 2025

The First Rule About Building Software Is Wrong “If there’s one rule that almost everyone universally agrees with about building software, it’s that focus is really important,” Conrad explains, citing Silicon Valley luminaries Bill Gurley and David Sacks who consistently advocate for narrowing your focus.

Startup 162

Startup Sales Hiring Underperforming Technical Team Cloud 162

SaaStr

MAY 31, 2023

Everyone is basically doing more with not much more headcount (see next point). #4. Growing Headcount, But Much More Slowly That Revenue. Headcount is up 29% year-over-year, but revenue is up 50%. Also you can see sales & marketing headcount is basically flat, while hiring is almost all in engineering / R&D.

Headcount 246

Headcount Scale Sales Hiring AWS 246

SaaStr

SEPTEMBER 30, 2024

Software, innovation and time marches on. But it’s already starting in the contact center, where leaders from Zendesk to Gorgias to Intercom to Talkdesk are automating away 30%-50% of contact center headcount. But I’ve also seen others grow even faster as AI rebooted and enhanced their products. Maybe, maybe not.

AI Search 305

AI Search SaaS Headcount AI 305

SaaStr

MARCH 8, 2023

Don’t Tie Revenue To Headcount “You want to get away from a business model where every incremental dollar requires incremental hiring,” says Deatsch. So instead of focusing on scaling headcount quickly, work toward growing revenue quickly. For Atlassian, it was for teams within organizations.

Sales Hiring 264

Sales Hiring Enterprise Headcount Scale 264

SaaStr

JANUARY 30, 2024

They did layoffs and froze headcount. If the founders are truly committed and truly want it, then that existing $2m-$20m in ARR becomes customer funding for the next generation of products and software. That’s the beauty of true software. That they had to get to cash-flow positive, because no more money was coming.

Headcount 301

Headcount Finance Startup Trends 301

Clouded Judgement

MAY 24, 2024

Every week I’ll provide updates on the latest trends in cloud software companies. Subscribe now First Look at April Quarters Heading in to this week, software earnings have not been good. ” In general, it’s still tough out there in software. Follow along to stay up to date!

Cloud 157

Cloud Software Headcount Scale 157

SaaStr

MARCH 1, 2022

Headcount up 7%, while revenue is up 37%. But that only increases total headcount 7% which revenues went up 37%. That’s the way software works — without a salesteam. But it’s now finally in decline, shrinking 12%. #5. Impressive leverage. You get leverage.

Scale 263

Scale Marketplace as a Service Headcount Cloud 263

SaaStr

AUGUST 21, 2024

Shopify and Bill both also get the majority of their revenue from financial fees and transaction fees, not software subscriptions. Only Grew Sales & Marketing Expense 12%, and Cut R&D (Product + Engineering) and G&A Expenses Toast has gotten to profitability by truly holding the line on headcount and revenue expenses.

Scale 306

Scale Payment Methods SaaS Payments Payment Solutions 306

Tom Tunguz

OCTOBER 31, 2023

With the end of the fiscal year approaching for many software companies, management teams are running the numbers for different scenarios. Software purchasing activity seems to be trending up, which should instill more confidence in their pipelines. Software spending should increase 15% - the fastest rate in the last three years.

Headcount 217

Headcount Sales Hiring AI Cloud 217

Tom Tunguz

AUGUST 23, 2020

Massive headcount growth presages large software purchases and expansion. The ideal scenario is one where purely external signals confer a prospect’s propensity to buy. A prospect experiences hypergrowth is perfect example. A company anoints a new department head catalyzing change.

Scale 267

Scale Headcount Sales Startup 267

Tom Tunguz

DECEMBER 17, 2023

Data teams are becoming software engineering teams. Like the Devops movement, the Dataops movement aims to scale the use of data within companies without increasing the headcount of the data team. I learned a tremendous amount about the way modern data teams, who leverage software engineering disciplines, operate.

Data 267

Data Government Headcount Scale 267

SaaStr

DECEMBER 18, 2023

At SaaStr Annual , IBM’s VP of Software and Technology Raj Datta and Director of Startups Kylie Rutherford shared how AI is changing the game for companies of all sizes. AI has been with IBM for 20 years, and now they have Enterprise-grade software. growth in the last few months alone. How to create a competitive advantage.

AI 305

AI Technology Scale Startup 305

FastSpring

AUGUST 13, 2020

Companies selling software, SaaS, and digital products have had to handle evolving consumer habits, emerging privacy regulations combined with an unprecedented global pandemic and economic uncertainty. Take a look at the infographic below to learn more about these key software ecommerce trends: The increased demand for software.

Trends 137

Trends Software Headcount B2B 137

SaaStr

AUGUST 9, 2024

Hiring for Customer Success When Braze was looking for their first customer success hires, you couldn’t find a CSM with seven years of experience in software because those people didn’t exist yet. Headcount isn’t the right story for them, though. So, instead, you had to search for the specific skills you needed for the role.

Scale 296

Scale Sales Hiring Scaling Startup 296

SaaStr

SEPTEMBER 3, 2023

Recurring software revenue is now recognized as a great way to generate tons of cash for investors,” says Gerety. By freezing headcount for a year. Mathematically, if you keep the headcount flat and continue growing 50% like Monday or 30% at $2B like Hubspot, you get wildly more efficient. But that wasn’t always the case.

Sales Hiring 278

Sales Hiring Headcount Finance Technical Review 278

Intercom, Inc.

NOVEMBER 3, 2022

You’re investing resources in hiring and training the right people, tracking different metrics at different stages, adding more and more complexity with each increase in headcount, use cases, and customers. Natasha Ratanshi-Stein is the founder of Surfboard , a software company that offers scheduling tooling for customer support teams.

Scale 206

Scale Outsourcing Services Software Sales Hiring 206

SaaStr

AUGUST 10, 2022

Atlassian plans to double its headcount over the coming few years. The end state goal for software is 20%+. #7. And half of Atlassian’s employees now live 2 or more hours from the office. This is the secret sauce to Atlassian’s business model. And its doubling down on being hybrid and distributed. #4. This is epic.

Scale 289

Scale Headcount Cloud Forecasting 289

Tom Tunguz

AUGUST 4, 2024

Call it Service-as-a-Software. Whatever the reason, the challenge is the same facing a hiring manager : difficult recruitment to maintain or grow headcount. Call it AI agents or agentic systems. There’s a brewing idea that AI will complete human labor especially in white-collar work. Last, margin pressure.

AI 203

AI Software Review Marketing Systems Review 203

SaaStr

APRIL 20, 2022

Like GitLab and other enterprise leaders for developing software, a lot still runs on private clouds, servers, and more. But they need the headcount to grow this quickly. #8. From 58% growth at $200m ARR to 71% at almost $500m in ARR. #2. Most customers still run Confluent on their own compute, but Cloud rapidly growing.

Scale 62

Scale Cloud Headcount Scaling 62

SaaStr

MARCH 20, 2023

Some define it by headcount, typically around 200-2000 employees, and others by revenue, generally $10M to $1B annual recurring revenue. In rapidly growing companies, the headcount can go from 500-3000 in a matter of months. Often, your champion might not know how their company buys software. They’ll think it’s them.

Scale 243

Scale Enterprise Scaling SMB 243

Tom Tunguz

JUNE 5, 2022

Software & Infrastructure companies are more optimistic than web3 and consumer founders, who average 4.8. About 20% of those polled will conduct a layoff, and on average will reduce headcount by 20%. The typical founder feels 6.0 scale, just slightly better than neutral about the market.

Startup 242

Startup Scale Headcount Compensation 242

SaaStr

JULY 20, 2022

” But it’s also a reminder how hard it is to combine services, hardware and software and make money from SMBs. #3. Fairly low revenue per headcount, although being headquartered in Utah with a large presence in India does seem to bring costs down. #7. Majority (59%) of its customers still pay monthly. Series C ($5.35

SaaS Payments 290

SaaS Payments Scale Payment Methods SMB 290

SaaStr

MAY 9, 2024

Our focus is on enterprise software and commerce infrastructure such as fintech, and logistics. Until recently, founders would describe their growth rate by how fast they were growing their company headcount. Activant Capital is thrilled to have invested in Owner multiple times already. #2. And how big is your current fund?

Scale 275

Scale Headcount Travel B2B 275

SaaStr

JUNE 7, 2021

The other thing is I’ve studied enterprise software for literally 30 years. I was an intern at IBM mainframe software when I was 20 years old. I had always done general software things, database software, mainframes, PeopleSoft, run that technology groups, Salesforce.com platform for everybody. What are you doing?

Sales Hiring 340

Sales Hiring Underperforming Technical Team SaaS Headcount 340

The Angel VC

MARCH 23, 2016

If you have a SaaS startup with a higher-touch sales model where revenue growth is largely driven by sales headcount, the plan needs to be modified accordingly. With the exception of the VP of Sales role, sales staff headcount planning is done on the separate "Sales Team Hiring Plan" tab (re-using a model that I've built for this post ).

SaaS Payments 217

SaaS Payments Headcount SaaS Payment Methods 217

Tom Tunguz

FEBRUARY 13, 2023

I’m watching public company earnings to identify early trends in the software market to inform startups’ plans for 2023. But it may also suggest that many resellers with large sales teams looking to sustain their transactional businesses are able to drive additional software bookings. Yesterday, Cloudflare announced earnings.

Cloud 244

Cloud Azure Headcount Software Review 244

SaaStr

JANUARY 12, 2024

SaaStr CEO Jason Lemkin also wrote how Customer Success has now morphed into part of the sales team and that the 2024 trends in CS include everyone wanting to eliminate humans from support to replace that headcount with AI and bots. In the bubble, people gorged on software and entitlements. The world has changed.

Sales Hiring 322

Sales Hiring Customer Success Scale AI 322

SaaStr

APRIL 3, 2021

All software slowly but surely gets out of date. If nothing else, you can pretty reliability track headcount growth on LinkedIn). Your competitors have the same seasons. You can’t blame it on market changes. Again, they play in the same market. It challenges you, in the right way, to avoid complacency.

Azure 239

Azure Headcount AWS Education 239

SaaStock

MARCH 27, 2019

Superlógica was started back in 2001 as an ERP software for condominiums. In the last three years, it has grown from 60 to 225 in headcount, 10x in revenue and now serves 4 different verticals. André Baldini started out as VP of Sales In 2017 he was promoted to CEO. He has certainly had a massive impact on Superlógica.

Pricing 201

Pricing Headcount Banking Revenue 201

Tom Tunguz

DECEMBER 31, 2023

Companies & startups in particular begin to report meaningful improvements in productivity from AI, reducing their headcount growth, butn growing revenue just as much as projected. Private equity acquires 10% of the 70+ publicly traded software companies by the end of the year. The prediction said 7 PE public take-outs.

AI Search 240

AI Search Headcount Scale AI 240