SaaStr

APRIL 10, 2023

Others may seek to corner the SMB market. And as part of that push from my vantage point as Chief of Staff, I saw the need to continue investing in those early-stage startups so that we didn’t put all our eggs in one basket but that we continue to grow and nurture the companies that would go on to become great.”

Startup 196

Startup Scale SMB Venture Capital 196

OPEXEngine

MAY 18, 2021

In this blog, we are looking at the business metrics that can be measured quantitatively and providing a few insights on how investors analyze them. We’ve talked to dozens of our SaaS customers, as well as investors to learn more about what is happening with these key metrics. SaaS Metric #1 – Annual Recurring Revenue (ARR).

SaaS Payments 98

SaaS Payments Metrics Payments Payment Services 98

SaaStr

DECEMBER 8, 2022

NRR is Metric #1. This is a long-term theme on SaaStr, but it was interesting to me just how much this is Yamini’s #1 north star metric. Even selling to SMBs, HubSpot gets half its growth at scale from its installed base. I strongly believe in investing as much in Customer Success as possible. More Than Sales.

Scale 227

Scale SMB Scaling Customer Success 227

SaaStr

JULY 20, 2022

While these aren’t great metrics if Weave was enterprise, they are still solid for SMBs. Many SMB SaaS companies struggle to hit 100% NRR and 80% GRR. A fairly standard SMB price point. A reminder growth investing isn’t a space you automatically make money at. And a few other interesting leanings: #6.

SaaS Payments 230

SaaS Payments Scale Payment Methods Payments 230

SaaStr

OCTOBER 30, 2021

Their CEO will join us at SaaSr Scale 2021 on December 15 to talk about using data to get to 10,000 SMB customers! I asked Aasif Osmany to share his learnings as a top-performing SMB VP of Sales, below. A mentor of mine suggested that I reframe my search to seek out companies that I would invest in, instead of the other way around.

Scale 254

Scale Sales Hiring Sales SMB 254

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. I created this subset to show companies where FCF is a relevant valuation metric.

AI 183

AI Revenue Cloud Technical Advisors 183

Clouded Judgement

APRIL 11, 2024

Through these interactions, I’ve built up mental benchmarks for metrics on which I place extra emphasis. My hope is that this analysis can provide startup entrepreneurs with a framework for how to manage their businesses around SaaS metrics (e.g., This metric is more self-explanatory, so I won’t go into detail.

Cloud 177

Cloud Software Azure AWS 177

SaaStr

JUNE 7, 2023

It has now secured over $67M in funding and offers a robust platform for mid-market and SMB segments. WorkRamp shifted its focus to a different segment –– the mid-market and SMB side. Customer Impact : A much better PMF for SMB & Mid-Market customers. “You Well, not all the time.

Scale 191

Scale Scaling SMB Marketing 191

SaaStr

JANUARY 12, 2021

Most of the companies in this 5 Interesting Learnings Series have had net negative churn from SMBs (e.g., Xero’s SMB churn isn’t zero. Customer Lifetime Value is 81 months, from SMBs. This is a critical metric. It takes them over a year to go profitable on an SMB customer. Zoom, PagerDuty, etc.).

Customer Lifetime Value 212

Customer Lifetime Value SMB Churn Scale 212

SaaStr

MAY 4, 2022

For SMB, it could be $20m-$30m in ARR. I’m going to summarize a bunch of my learnings into 2 rough metrics , and then let’s do a deep dive across a bunch of SaaS leaders to see what we can learn. It’s what I’ve found in particular across my 30+ venture investments. jasonlk) April 29, 2022.

Scale 242

Scale SaaS SMB Scaling 242

SaaStr

FEBRUARY 8, 2022

Knowing which metrics matter and how to analyze them to increase your revenue and hit organizational sales goals is essential. . Waze sales executives Fernando Belfort , Head of SMB Sales, and Kendra Wrightson , Head of Sales Enablement, discuss optimizing sales processes for four essential data points: value, variety, volume, and velocity.

Scale 219

Scale Sales Hiring Compensation Sales 219

SaaStr

APRIL 14, 2023

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. Create a full breakout plan first, then look back and figure out who will invest. Do you want to fire a rocket into space?

Development Team Review 211

Development Team Review Technical Review Underperforming Technical Team SMB 211

Sales Hacker

SEPTEMBER 25, 2019

Enterprise sales is hard, which is why most businesses start as an SMB org and grow into an enterprise org. So let’s look at how to drive sales in a high-growth situation, so the transition from SMB to enterprise is smoother (and faster). 2 rules for transitioning from SMB to enterprise. Invest in a community.

SMB 73

SMB Enterprise Strategy Compensation 73

SaaStr

OCTOBER 29, 2020

Zendesk doesn’t see the 140%+ net retention we see in the enterprise (big deal sizes) or in many B2D companies like Twilio, but it’s still above 110% for a business that is 60% Enterprise / 40% SMB. Strive for at least 110% net revenue retention if you sell to a mix of SMBs and Enterprise. Are you investing enough there?

SMB 236

SMB Enterprise Retention Churn 236

User Pilot

AUGUST 6, 2023

Due to the necessity of data analytics when optimizing the omnichannel customer experience, you’ll have more metrics to work with. Having dedicated surveys for key metrics like CSAT, CES, and NPS. Source: SMB Compass. Data-driven decisions. Collecting both quantitative and qualitative customer insights.

Investment 87

Investment Banking Social Media Customer Lifetime Value 87

ChurnZero

MARCH 18, 2022

With so many SaaS metrics floating around, and even more opinions on when and how to use them, it can be hard to know if you’re measuring what really matters. Leading SaaS expert, Dave Kellogg, and ChurnZero CEO, You Mon Tsang, sat down to answer all the questions you want to know about SaaS metrics like ARR, NRR, GRR, LTV, and CAC (i.e.,

Customer Success 98

Customer Success Metrics SaaS Banking 98

Clouded Judgement

DECEMBER 21, 2023

Through these interactions, I’ve built up mental benchmarks for metrics on which I place extra emphasis. My hope is that this analysis can provide startup entrepreneurs with a framework for how to manage their businesses around SaaS metrics (e.g., This metric is more self-explanatory, so I won’t go into detail.

Cloud 177

Cloud Software Benchmarks Retention 177

SaaStr

OCTOBER 11, 2023

You don’t want to overwhelm SMB customers, and Monday made this a focus from day one. Measuring Usage Since Day One Since the beginning, monday.com built and has used a BI tool called Big Brain — a major investment for that size of company. All the metrics we’re using — LTV to CAC, CAC return rate — don’t take cash into account.

Scale 164

Scale Sales Hiring Scaling Banking 164

Tom Tunguz

JANUARY 14, 2015

Based in New Zealand, Xero has built a widely adopted small-to-medium business (SMB) accounting solution that counts 371,000 paying customers, a figure that grew 76% in the last 12 months. First, Xero is a glowing example of a successful SMB SaaS company. And in the US, each accountancy provides about 13 SMB customers to Xero.

Benchmarks 100

Benchmarks Metrics SMB Outsourced Development 100

Tom Tunguz

AUGUST 26, 2014

HubSpot is the second fastest SMB SaaS company to IPO yet, achieving the mark within 8 years. Most other SMB companies, defined for this analysis as having an ARPC of less than $15,000, took at least one more year to go public. Impressively, HubSpot has been able to record much faster revenue growth than other SMB SaaS companies.

Benchmarks 113

Benchmarks SMB Metrics SaaS 113

Clouded Judgement

SEPTEMBER 12, 2023

Through these interactions, I’ve built up mental benchmarks for metrics on which I place extra emphasis. My hope is that this analysis can provide startup entrepreneurs with a framework for how to manage their businesses around SaaS metrics (e.g., This metric is more self-explanatory, so I won’t go into detail.

Cloud 169

Cloud Software Benchmarks Retention 169

Clouded Judgement

JUNE 9, 2023

Given most software companies are not profitable, or not generating meaningful FCF, it’s the only metric to compare the entire industry against. Most public companies don’t report net new ARR, so I’m taking an implied ARR metric (quarterly subscription revenue x 4). Even a DCF is riddled with long term assumptions.

Trends 130

Trends Cloud Azure AWS 130

SaaStr

APRIL 28, 2019

All the great SaaS companies IPO’ing now have strong revenue retention, whether SMB or enterprise focused. ” The Slack Fund is tiny. “As of January 31, 2019, Slack Fund has invested $10.1 In fact, it has pretty similar metrics and sales cycles to other SaaS leaders here. Not burning that much cash.

Scale 275

Scale Venture Capital SMB Enterprise 275

Clouded Judgement

JUNE 2, 2023

One of my favorite metrics to look at is net new ARR added in a quarter. ” From Okta: “We're seeing increased macro headwinds on our business, most notably with new business across SMB and enterprise. Let’s start with one obvious point - Q1s have been rough! Forget the outlook / guide for a minute.

Cloud 130

Cloud Trends SMB Subscription 130

Intercom, Inc.

OCTOBER 24, 2022

One way is to incentivise your sales team on customer success metrics or the renewal. The more you invest in refining your customer journey, the bigger opportunity you have to grow the account. Enterprise and SMB companies typically purchase in different ways and require different levels of support.

Strategy 91

Strategy Sales SMB SaaS 91

ChurnZero

JUNE 19, 2020

What data you need to get the investment in your Customer Success team. Q: Does the importance of retention metrics vary by strategic buyers versus private equity (PE) buyers? The metrics are obviously very important, and they probably are why they buy “Company A” versus “Company B.” Q&A Recap. Rob]: Here’s an example.

SaaS Payments 72

SaaS Payments Retention Metrics Payment Solutions 72

Clouded Judgement

APRIL 12, 2023

Through these interactions, I’ve built up mental benchmarks for metrics on which I place extra emphasis. My hope is that this analysis can provide startup entrepreneurs with a framework for how to manage their businesses around SaaS metrics (e.g., This metric is more self-explanatory, so I won’t go into detail.

Cloud 161

Cloud Software Benchmarks Retention 161

FastSpring

SEPTEMBER 16, 2022

Prior to joining FastSpring, Kurt spent over a decade advising and investing in growth stage software companies around the world. How FastSpring’s platform allows companies to test their pricing (2 minutes): Full Videos. About FastSpring.

Pricing 110

Pricing Payment Solutions Payment Services SaaS Payments 110

Tom Tunguz

OCTOBER 21, 2017

Over that 20 year period, annual SaaS investment has increased 20x, peaking in 2014 at $7B. Segmentation - focus on SMB, Mid-Market, or Enterprise, to play where competition isn’t present. I’m using SaaS seed rounds as a proxy metric. Salesforce was founded in 1999. Trades market size for better product market fit.

SaaS 189

SaaS Venture Capital Finance Machine Learning 189

Clouded Judgement

JUNE 20, 2023

Through these interactions, I’ve built up mental benchmarks for metrics on which I place extra emphasis. My hope is that this analysis can provide startup entrepreneurs with a framework for how to manage their businesses around SaaS metrics (e.g., This metric is more self-explanatory, so I won’t go into detail.

Cloud 161

Cloud Software Benchmarks Scale 161

ChurnZero

JUNE 2, 2021

If they stop using it, depending on what the metric is that it’s based on, it’s more volatile. A [Rob]: That’s more of a question for the earlier stage investing in the public market. A private equity investor once said that he only invests in companies where that’s 40 or higher. I will say this much.

Benchmarks 98

Benchmarks B2B SMB SaaS 98

Clouded Judgement

DECEMBER 20, 2022

Through these interactions, I’ve built up mental benchmarks for metrics on which I place extra emphasis. My hope is that this analysis can provide startup entrepreneurs with a framework for how to manage their businesses around SaaS metrics (e.g., This metric is more self-explanatory, so I won’t go into detail.

Cloud 130

Cloud Software Review Software Benchmarks 130

SaaStr

OCTOBER 31, 2019

What I’m going to do is talk a little bit about what we’ve seen over the course of the last year and then also talk about some metrics we track or we encourage our founders to track as they’re building their businesses, and then, lastly, try to go through a few predictions for the next couple of years.

Cloud 100

Cloud Scale AWS Machine Learning 100

User Pilot

SEPTEMBER 19, 2023

Product-led growth may be a bit of a buzzword, but achieving no-code growth is particularly important for SaaS companies with low ACV, freemium models and generally those in the SMB sector. Finally, product analytics is another “must-have” that a good no-code growth platform should provide.

SMB 52

SMB Onboarding Mobile Revenue 52

The Angel VC

APRIL 30, 2015

By putting together a comprehensive set of data you can pre-empt 90% of the questions which investors will ask you when they assess a potential investment. In this case, the following things will help you pre-empt a lot of DD questions: 1) A spreadsheet with your key metrics , since launch, on a monthly basis.

Software Review 186

Software Review Outsourced Development Acquisition SMB 186

OPEXEngine

FEBRUARY 27, 2020

You, the CFO of a mid-sized SaaS company have spent the last 2-3 years getting your financials, your retention, CAC and other key metrics, in shape so you are offered an attractive valuation multiple. The cost per hack of an SMB company is minimal and the number of SMB cyber events is growing by 10% year over year.

Systems Review 69

Systems Review Technical Review Cybersecurity SaaS 69

SaaStr

JUNE 27, 2019

We ingest more than 2 billion events and metrics per minute as we’re providing observability to our customers about what’s going on in their application and infrastructure environments. We also invested around those field account executives, more technical sales, pre-sales and eventually, customer success and post sales.

Scale 171

Scale Enterprise Scaling Sales Hiring 171