Cash collections is a topic we haven’t discussed much on SaaStr, but boy it can be important all the way until you have a CFO. And often after.
What’s the issue? The issue is that start-ups are terrible at collecting cash that doesn’t come from a payment gateway. Just terrible.
– terrible at collections. start-ups without an A/R function often have $250k-$500k in uncollectible receivables.
– metrics that break and don't make sense. starts to harm you in later fundraising.
– inability to do cohort analyses, or even often, any basic analyses
— Jason ✨𝚂𝚊𝚊𝚂𝚝𝚛𝙿𝚛𝚘.𝚌𝚘𝚖✨ Lemkin 🦄 (@jasonlk) February 15, 2019
And they often get worse as they go upmarket. They hook up a payment system when they start as self-service, and the cash magically flows into the bank account. But then they close some bigger customers. And add some services. Both
David Skok, General Partner @ Matrix Partners: Why does David believe that all good products have at least one variable pricing axis? How can founders determine which variable they should choose for their product? What are the pros and cons?
Chetan Puttagunta, General Partner @ Benchmark: Why does Chetan believe we have seen a strong decline in the per seat pricing model? What are the major drawbacks of it? What are we seeing replace it? What has Chetan seen work well amongst his portfolio?
Mark Suster, General Partner @ Upfront Ventures: What were Mark’s two biggest lessons on pricing from seeing the hyper-growth of Salesforce first hand? What does Mark advise founders when it comes to price anchoring and discounting? How does Mark view the sale of professional services with this in mind?
Here’s what I look for to try to get a sense if they’ll perform:
Do they call out top performance with metrics? The best reps are often quite precise. E.g., hit 152% of Quota last year, 143% year before, etc. Maybe they are exaggerating, that’s besides the point. The question is, do they love to win and have a history of it? Metrics are a good indicator here.
Have they sold at your core price point? This may be a little work, but look at where they worked and see if it’s a fit for your price point. If not, maybe move on.
Are their LinkedIn recommendations solid? Yes, of course these can be gamed a bit. But I don’t mind that. That’s part of sales. Most top reps and top leaders have 3+ glowing LinkedIn recs. I just want to see them there. Tablestakes.
One thing almost every founder I meet with these days has figured out is that outbound email campaigns work. But not always at first, not always the same way.
It took me a while to figure it out, too. In my first start-up, I cold emailed the VP Engineering of a Fortune 100 company. He called me back the next day. I thought I was a genius! My second cold email, I got a Top 3 prospect to call me back in 24 hours!
Well, later I learned why. He was running a $500m+ initiative, and a critical vendor who was our competitor was failing. They were 18 months behind, and they’d just increased pricing 30%. He was desperate for another vendor. And I emailed him at just the right time. With just the right, crisp, clear message. Continue reading "Email is Amazing. You Just Have to Use It Properly."
Alex Western, Managing Director at Think3, talks about the problem he has seen consistently across SaaS startups that have VC funding – overgrowth. Overgrowth normally happens because of misalignment in VC initiatives and founder initiatives. Because VCs want to make 15x on their investments, founders aren’t realizing that overgrowth is actually dangerous for their companies. Alex suggests different approaches on handling overgrowth and how smaller-valued exits might be the best strategy long-term for both founders and VCs.
Also, if you didn’t attend SaaStr Europa, we’re doing it bigger and better in June 2019. Grab your tickets! 🙂
TranscriptAlex Western – Managing Director at Think3
I’d like to start with a story. About a year ago I met a company called PowerDrive which sells a CRM solution to the auto mechanic space. The founder Marko is actually become a friend of mine. The company was 3 million a year Continue reading "Is Growth Bad for Startups? Feat. Think3 (Video + Transcript)"
Welcome to Episode 208! Anne Raimondi has more than 20 years experience driving growth at startups and building them into nationally recognized brands. She has served as a leader and executive for technology innovators including Zendesk, Survey Monkey, Blue Nile, and eBay. Anne is also a Lecturer in Management at Stanford Graduate School of Business, teaching two popular courses, “Startup Garage” and “POWer: Building the Entrepreneurial Mindset.” She currently serves on the board of directors for SendGrid (NYSE: SEND) and MyHealthTeams. If that was not enough, Anne is also an active angel investor with an incredible portfolio including the likes of Canva, ipsy, and Minted just to name a few.
In Today’s Episode We Discuss:
How Anne made her way into the world of startups with Zendesk? How did seeing the hyperscaling of Zendesk impact Anne’s operational approach and mindset?
I’ve held off for 6+ years and 3000+ Quora answers on writing a post on Board Meetings. Why? Every investor in the world writes lengthy posts on How to Have a Great Board Meeting. How to Have a Great Pre-Board Meeting. How to Have a Great Board Meeting Week. Etc. etc. etc. etc. Well, it makes sense. VCs, once they have been doing it a while, basically become professional Board Directors. But I rarely find these posts help founders hack board meetings to help them. Or even explain why you should do them — if you don’t have to.
But how can you make Board Meetings work for you as a founder — especially if you are early stage and don’t have to have them yet? A few non-obvious ways you can use having regular Board meetings to help you. Continue reading "5 Reasons to Actually Have Board Meetings"
We are getting SO close!
Feb 5,6 and 7 is The Biggest, Funnest, Most Inclusive, Most Mentor-ing SaaStr Annual ever!
Some great upgrades include:
A dedicated Q+A/AMA stage (presented by Quora) with 30+ amazing Q&A/AMA Sessions! Get your burning questions answered by CEO and SVPs of Sales, Marketing, Success and Product from Zendesk, RainforestQA, Hubspot, WP Engine, InVision, MongoDB, Asana, Dropbox, Fireeye, DataBricks, Segment, Egnyte, Moat and dozens more!
More mentoring! 300+ Braindate 1:1 and 1:5 sessions! We’ll have Braindates back in force, as well as a meet-a-new-friend app. More chances to meet and learn from other great execs and founders.
51 Unicorn speakers! Wow. CEOs and founders of WordPress, Twilio, Qualtrics, Pluralsight, Intercom, Hubspot, Stripe, Plaid, Brex, Flexport, Zendesk, Adyen, Talkdesk, Sendgrid, Atlassian, Ring Central, Pagerduty, Duo Security, Glitch, Adaptive Insights, ServiceTitan, Tradeshift, WalkMe, LiveRamp, AWS, Eventbrite, Smartsheet, Glassdoor and so many more!
Every SaaS CEO knows they need to train their team. But it’s easy to see why team-based training often gets overlooked: there’s always a fire to fight. Code has to get shipped, the product needs to get designed, sales teams need to close, and as a result, training a management team in a structured way is hard to do right. But for Brian Glick, CEO of Chain.io, it was too important to put off.
Why’d you decide to use SaaStr Pro?
“You know, it’s funny. I found myself posting SaaStr posts into our team Slack channel all the time, but I never knew what actions we were going to take as a result, so I thought ‘there has to be a better way to share this content with my team.’ Most of my team doesn’t come from a SaaS culture —