Quietly mentioned in yesterday’s press conference about Google’s Android update is a new feature that will change the way people use their mobile phones, search deep-linking. With KitKat, Google is applying its world-class crawling and search technology to the content and data within mobile applications.
Quoting from the Verge, >A search for a restaurant will offer a link directly to that restaurant page in the OpenTable app if you have it installed, allowing you to set up a reservation.
Every SaaS business suffers from churn. If churn isn’t managed properly, the lost revenue from churned customers offsets new revenue and the business flat-lines or suffers negative revenue growth. I’ve seen startups employ three patterns for offsetting churn: acquiring new customers faster, upselling existing customers to buy more software, or structuring pricing to grow with customers.
Each strategy requires different levels of investment but achieves similar results. These strategies are often deployed in addition to a customer success team, which require their own investment.
How do you validate an idea for a software startup before the product is built? Last week, a founder of a SaaS business and I were wrestling with this problem. It’s a question without a universal answer. After a while, we came up with quick and dirty rule of thumb for his business. Can he hit his quota?
Suppose this founder wasn’t the founder, but the first inside sales hire for the startup.
Driving sustainable growth is a challenge for every SaaS business from startups to public companies. In the beginning, the SaaS recurring revenue model seems like a dream compared to the revenue fits and starts of licensed enterprise software. But within one short customer lifetime, every SaaS CEO startles awake to the fact that the churn monster is always looking over your shoulder.
In the short run, SaaS growth scales with customer acquisition, but in the long run churn kicks in and dominates even the most aggressive SaaS growth strategy, creating a SaaS growth ceiling that can be incredibly difficult to break through. SaaS churn naturally scales with the size of your customer base making it negatively viral. Overcoming churn and breaking through the SaaS growth ceiling requires a relentless focus on growth that pushes every available SaaS growth lever.
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There’s an interesting phenomemon occurring in founder compensation for post-Series A companies: founding CEOs are swapping cash for larger equity stakes in their companies. Founding CEO salaries, post Series A, have fallen by about 24% while founder equity has increased by 32%.
This trend is broad. Each year, Redpoint portfolio companies participate in a compensation survey along with the portfolio companies of about 50 other firms, totaling about 800 startups. A third party pools the data to benchmark compensation trends across the executive functions in startups (CEO, VP of Product, VP of Marketing, VP of Sales, and so on) across the different financing series, locations, development stages and founders vs non-founders.
There’s a perpetual and roaring debate in Startupland about the ideal founding team. Should the ideal team be entirely computer scientists? How important to success is having an MBA/business person? What about the stories of billionaire dropouts?
To answer that question, I’ve aggregated the academic backgrounds of 30 of the top startups of the past few years and analyzed the make up of each of those founding teams.
Above is a chart comparing the number of “billion” dollar startups by the total number of founders and the share of technical founders.
This week, Netflix announced its US userbase grew to 31M subscribers surpassing HBO for the first time. The magnitude of Netflix’s milestone is hard to overstate. In a bid to compete with Netflix, HBO has partnered with Comcast, which serves 21M subscribers, to trial an Internet-only subscription plus HBO, the first time HBO is available to US consumers without a full cable subscription. It’s a clash of behemoths.
Separately, the NY Times revealed they have amassed more than 700,000 digital subscribers who provide upwards of 20% of circulation revenues and grow about 40% year over year.
Intent to purchase is the engine of the consumer web. Creating and capturing intent motivates almost every dollar invested into ecommerce and advertising. Intent is also the fuel for the Internet’s most successful business model, Google’s AdWords + Search.
As the internet has evolved, so have the ways of creating and capturing intent. From display to search to retargeting to collections, each new technique has leveraged data in a novel form to discover consumers’ wishes.
Financial statements are the Rosetta Stone for a business. They are the most succinct way of communicating how a business operates to management teams and boards, who weigh the trade-offs of different investments.
In the early stages of the startup, financial statements aren’t used much as a management tool. They are most often used to keep an eye on monthly burn rate. But as companies grow, startups hire leaders to manage marketing and sales and product and engineering.
Customer References are the best way to get credibility for your product. While the eventual decision by the prospect might be more dependent on your value proposition and how painful of a problem the prospect has, references could push the deal past the goal post. Providing references that can vouch for the product has become an integral part of the sales cycle. Most early stage companies sweat bullets when it comes to furnishing them.
Irrespective of what stage your company is at, in its lifecycle, you will be asked for references. Consider it as a certificate of merit for the excellent service you have provided your existing customer. While NPS (Net Promoter Score) serves as an indicator of your customer loyalty (also how good your customer satisfaction score has been), a customer reference is an indicator of how compelling the value proposition of your product/service is.
If you are a
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