SaaStr

JUNE 28, 2023

If there’s one rule almost everyone universally agrees with when building software, it’s that focus is critical. As a founder of two different compound startups, each valued at above a billion dollars, he’s probably the best person in the world to share this alternative perspective. the compound startup.

Startup 205

Startup Software Sales Hiring Pricing 205

Tom Tunguz

JANUARY 6, 2024

Hang around startups & venture capital long enough, & you’ll hear this aphorism. In any given year, there’s an 82% chance the value of startup liquidity will change by more than 77% - both up & down. Here’s the volatility visualized across web3, consumer, & software startups.

Startup 292

Startup Venture Capital Software Marketing 292

Tom Tunguz

MARCH 10, 2022

I’m going to tell you a bit about two startups and I’d like you to guess the name of each company. Both startups provide database software to developers to build applications. Both of these businesses are publicly traded. Both have grown very fast.

Startup 338

Startup Pricing Revenue Software 338

Tom Tunguz

DECEMBER 31, 2022

. % of Revenue spent on Software. Implied Web3 Software TAM, $M. Implied Web3 Software TAM (excluding Ethereum), $M. The average software company operates at about 70% gross margin, so let’s assume a web3 company is similar. At a 10x revenue multiple, web3 software should support about $0.75b to $2.3b

Payment Solutions 351

Payment Solutions B2B Software Payment Services 351

Kellblog

JULY 17, 2022

In general, I think branding is a potential marketing rathole for startups, particularly early-stage ones. Go sell some software. Go sell some software. Go sell some software. Some startups put the cart in front of the horse. Go sell some software to prove there’s a market. Do want to build a brand?

Branding 132

Branding Startup Software Sales Recruiting 132

SaaStr

JANUARY 2, 2024

ARR, Zendesk today gets 14% of new business from startups. On top of that, if you look at their top accounts globally, 33 of the top 50 customers by ARR are startups. This is where they started, but startups weren’t adopting the product as much with a discount, and there was a lot of conflict with the sales team. A free term.

Startup 177

Startup Scale Underperforming Technical Team AWS 177

SaaStr

FEBRUARY 16, 2024

And for many in SaaS, especially those that sell mainly to startups and tech, it’s often been a rough 2 years. But there are just enough of those, especially in the AI Boom of 2023-2024+, that a subset of venture-backed startups are still running the Grow, Grow, Grow playbook. With no more funding coming, and growth way down.

Startup 235

Startup Social Media AI Cloud 235

SaaStr

MARCH 14, 2024

Dear SaaStr: How Can You Land Big Customers If You’re a New Startup No One Has Heard Of? In fact, almost all the best run large enterprises know they have to seek out new gems in software to help their businesses run faster and better. Solve one of their top pain points, for real — that no other vendor is solving. Often fast.

Startup 216

Startup Innovation Enterprise Software 216

SaaStr

MARCH 8, 2024

They weren’t a 3H startup. But they often have much lower gross margins than pure software. pic.twitter.com/3K7wUTiyul — Fan Bi (buying $5-30M DTC brands) (@lifeofbi) February 20, 2024 The post The Riskiest Venture-Backed Startups Are 3H’s: High Growth, High Churn and High Burn appeared first on SaaStr.

Churn 218

Churn Startup SaaS Payments Venture Capital 218

Tom Tunguz

JANUARY 15, 2023

“The Startup M&A Market Fell 94% Year over Year - But One Segment Thrives” , a post from last week, elicited the same question from many readers. I reviewed the roughly 560 US software acquisitions under $400m since January 1, 2020. Alphabet bought $400m of startups & Apple $375m. To answer the question.

Acquisition 290

Acquisition Software Review Software Startup 290

Tom Tunguz

FEBRUARY 8, 2024

We’re entering a new pricing environment for software: AI vs non-AI. Theory created a public market AI index to track software companies who have significant product plans or current AI businesses. AI software companies are projected to grow 63% faster in 2024 than non-AI software companies because of customer demand.

Startup 315

Startup AI Software Pricing 315

Tom Tunguz

JANUARY 17, 2021

From time to time, I chart the fastest growing categories of startup investment in the US for seed through Series C. I analyzed Crunchbase data and looked for the startup categories that grew fastest in terms of funding rounds year-over-year, provided there were at least 10 rounds in that category.

Startup 362

Startup Software Engineering Finance Engineering 362

SaaStr

NOVEMBER 17, 2023

For the first time in twenty years, we have a blank canvas, complete artistic freedom to reimagine everything in B2B software. There is a close parallel between how the internet disrupted society and software and how AI will, too. Startups vs. Incumbents To beat out incumbents, you need good data. So, who wins?

AI 246

AI Technical Review Startup Management 246

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 is a very competitive landscape, so startups have to ask themselves how they’re going to gain a competitive advantage with it.

AI 228

AI Technology Scale Startup 228

Clouded Judgement

APRIL 11, 2024

My hope is that this analysis can provide startup entrepreneurs with a framework for how to manage their businesses around SaaS metrics (e.g., Is Software Rebounding? I’m calculating FCF by taking the Operating Cash Flow and subtracting CapEx and Capitalized Software Costs. net retention and CAC payback).

Cloud 177

Cloud Software Azure AWS 177

Tom Tunguz

FEBRUARY 8, 2022

The business builds software to help other crypto companies grow. Perhaps you’ll sell infrastructure to help other startups scale or software to manage internal operations. Most US web2 software companies might progress through their lifespans without ever uttering the words treasury management in a board meeting.

Payment Solutions 263

Payment Solutions Outsourced Development Software Review Software 263

SaaStr

AUGUST 19, 2023

So our good friend Lloyed Lobo as part of his new book and series on Building Community did a deep dive with Jason on how SaaStr built the world’s largest community for business software — somewhat on accident: Why do some companies have loyal, cult-like followings while others blend into oblivion?

Software 187

Software Business Social Media Government 187

Tom Tunguz

APRIL 27, 2022

Reflecting on this question a founder posed this week, I remembered how we came to be here, the three eras of startup pricing: cash-flow, multiples, and discount-to-future-value. The art of startup pricing in a recipe. $5m Startups were priced first on forward-revenue multiple. Web3/crypto startups are often priced this way.

Startup 270

Startup Venture Capital Pricing Investment 270

Tom Tunguz

JANUARY 12, 2022

In the last few weeks, public software company multiples have halved. Beyond the most recent cycle, how often do the web2 and web3 software markets move in synchrony? Beyond the most recent cycle, how often do the web2 and web3 software markets move in synchrony? The cryptocoins appreciated much more than software.

Software 334

Software Marketing Trends Startup 334

Incredo

MARCH 1, 2019

It’s a big challenge to reach business growth in a time when thousands of startups are founded on a daily basis. There are many reasons why a lot of startups fail: wrong budget management, uncertain business objectives, lack of expertise, etc.

Startup 178

Startup Software Strategy Marketing 178

Buffer Resources

APRIL 11, 2024

Think nonprofits and Silicon Valley startups have nothing in common?   As a tech writer and editor, I’ve also steeped in the “rocket fuel” of the startup world.   As a tech writer and editor, I’ve also steeped in the “rocket fuel” of the startup world. Think again.

Technical Review 102

Technical Review Startup Social Media Marketing 102

SaaStr

JULY 18, 2022

Gartner: businesses will spend $100,000,000,000 more on software in 2023 than 2022. Startups: THIS IS THE WORSE RECESSION SINCE THAT TULIP THING I READ ABOUT IN SCHOOL pic.twitter.com/qGKuXLchFQ. As of July 2022, Gartner predicts: Overall business software spend will still grow a stunning 11.8% Yes, $100B more in 2023.

Venture Capital 322

Venture Capital Software Cloud Forecasting 322

Tom Tunguz

APRIL 5, 2020

Which startup sectors are most affected by coronavirus? Roger Lee is maintaining Layoffs.fyi , which is a table of all the startups who have unfortunately cut staff. On the brighter side, it is a resource for startups looking to hire as they grow. But starting that week, startups began reducing headcount by about 700 per day.

Sales Recruiting 357

Sales Recruiting Startup Headcount Sales Hiring 357

SaaStr

MARCH 24, 2021

Sales terminology might feel unfamiliar, but the beautiful thing about using sales customer relationship management (CRM) software is that it provides a common structure for a sales process. Sales CRM — Software used to streamline pipeline management and safely store customer information, communicate with prospects, and drive more sales.

Sales Hiring 290

Sales Hiring Startup Sales Forecasting 290

SaaStr

SEPTEMBER 29, 2023

This showcases a narrow segment of a niche market, and it’s missing a lot of startups. Any startup in any reasonable category likely has dozens of competitors, and Altman believes the best strategy to compete in 2023 and beyond is multi-product. What Caused This Crowded Software Market? Startups are no longer fringe.

Scale 221

Scale Scaling Startup Sales Hiring 221

Tom Tunguz

MARCH 27, 2022

Before a startup is founded, no stock exists. The startup can inflate share count by creating shares. Public software median inflation rate rests at 5% annually, including shares for new employees, retention grants for current employees and primary stock sales in the public market to raise cash.

Startup 319

Startup Sales Hiring Government Outsourced Development 319

Tom Tunguz

MAY 25, 2022

Yesterday, Broadcom announced it will acquire VMWare for $70b, the largest software acquisition in history. Public companies can’t hide from the 70% collapse in multiples the way startups can. Software companies haven’t been this cheap to buy for a decade. Publics are marked to market daily. VMWare traded at a 4.4x

Acquisition 250

Acquisition Software Enterprise Startup 250

Tom Tunguz

NOVEMBER 1, 2022

During Office Hours with Lee Kirkpatrick , Lee recalled managing a startup through a downturn. I wondered if a similar pattern existed in the public software markets. R&D as a percent of revenue across all public software companies increased from 24% to 28% in the last six years. I suspect it’s because of PLG motions.

Software 301

Software Trends Revenue Startup 301

SaaStr

JUNE 25, 2023

What are some qualities of a bad startup CEO/founder in Silicon Valley? Can sell but can’t build great software. The post Dear SaaStr: What Are Some of the Qualities of a “Bad” Startup CEO? A few that I’ve seen across the handful of investments I’ve made … that didn’t work out: Not really committed to going long.

Startup 190

Startup New CTO CTO Investment 190

Clouded Judgement

SEPTEMBER 1, 2023

Every week I’ll provide updates on the latest trends in cloud software companies. Subscribe now Are Software Companies Over or Undervalued? Today I wanted to dig in to this question and its implications: “Are software companies fairly valued today?” Follow along to stay up to date! ” Let’s dig in.

Software Review 183

Software Review Cloud Software Revenue 183

Clouded Judgement

JULY 21, 2023

Every week I’ll provide updates on the latest trends in cloud software companies. Subscribe now Are Software Companies Bad Businesses? There was some talk last week on the All-In podcast about software companies. The gold standard for all public software companies is GAAP net income in the fullness of time.

Cloud 130

Cloud Software Sales Hiring Scale 130

SaaStr

JULY 29, 2023

But the larger topic of when to change your name as a startup is an interesting niche topic. Salesforce has brute forced it, even though today only a minority of their revenue comes from sales software. link] — Jake (@iamjakestream) July 24, 2023 The post When and If to Change Your Name as a Startup appeared first on SaaStr.

Startup 175

Startup Scale Branding Consulting 175

Tom Tunguz

AUGUST 16, 2023

Public software companies’ share prices have fallen 10% on average in the last 30 days dotted with positive notes like the stabilization cloud growth rates for Microsoft & Google. This is the moment startups with big balance sheets’ advantage will shine. Many startups will look to raise starting in September.

Startup 189

Startup Scale Strategy Forecasting 189

Tom Tunguz

APRIL 6, 2023

There are 4 questions a startup should ask themselves about building a startup that uses generative AI. There are 4 questions startups should ask themselves about building with generative AI. Startups have negative time to launch in many markets with Adobe, Microsoft, & Salesforce launching Gen AI enabled software in weeks.

Generative AI 228

Generative AI AI GCP(Google Cloud Platform) Startup 228

Tom Tunguz

APRIL 28, 2022

Third, software engineers decentralize only a subset of the app. How this quandary resolves will determine the most attractive places to build new infrastructure startups. Perhaps this dynamic drives consolidation in the market, paralleling the web2 infrastructure hypermarts of AWS, GCP, and Azure.

Payment Solutions 268

Payment Solutions GCP(Google Cloud Platform) Startup Payment Features 268

SaaStr

NOVEMBER 2, 2022

Dear SaaStr: Why Do So Many Startups Burn Through So Much Cash? For most software / internet companies, the gross margins approach 80%. The post Dear SaaStr: Why Do So Many Startups Burn Through So Much Cash? Competition. That means for every $10 you bring in, you get to keep at least $8 for payroll, etc.

Startup 232

Startup Branding Revenue Pricing 232

Andreessen Horowitz

MARCH 19, 2024

” Vijay Pande, founding general partner at a16z Bio + Health, joins the Software Engineering Daily podcast to talk about innovation in biotech and healthcare, the biotech startup landscape, the impact of AI, and much more.

Software Engineering 74

Software Engineering Engineering Software Healthcare 74