In SaaS, usually one of 5 things enable a new vendor to break-out in a crowded space:
- 10x better at One Important Thing. In the early days, you will be buggy and feature-poor. Maybe even in the not-so-early days But if you are 10x better at (x) One Important Thing that (y) customers value and will pay for, that’s enough. Many founders get this wrong however, and build a key feature that is indeed 10x better — but not one important enough to pick a raw new vendor to get. It’s only a subset of critical functionality that customers will pay to have implemented 10x better than an existing, trusted vendor. Usually, the part that is close to the money they make, manage, process, or collect. A little more here.
- Dramatically Cheaper. This one’s tough to play. Because businesses trust and value brands they can rely on. But often, Continue reading "5 Ways to Enter a Crowded Market. And 3+ Ways Not To."
Here’s my list of the best golden advice I was given as a first-time — and second-time CEO:
- Manage People — In General, and Earlier. The earlier in your career you can learn how to manage people, the faster you can excel in learning to scale. Managing people isn’t always fun. But embrace it if you want to be a CEO, a founder, and/or be a part of something bigger.
- Listen to “Audibles” and Act on Them. Your best bosses, VPs, mentors and others will give you “audibles” — quick bits of micro-advice duringpitches, customer meetings, interviews, etc. While you are in the process of working They’ll see where you could improve in real-time. Take this real-time feedback and leverage it and act on it immediately. If someone else great is in the room with you, these audibles can make the difference between a positive outcome and a Continue reading "The 7 Best Pieces of Business Advice I Was Given"
Recently I assembled my “Top 15” list of Sales & Marketing mistakes SaaS startups make as things start to take-off. We’ve touched on quite a few of these before on SaaStr (will link to them), but I thought this might be a helpful checklist to challenge your thinking at a minimum.
We’ve all made many of these mistakes ourselves, myself included
I’m even making a few myself again. But if you see yourself making any of the mistakes below, it’s fairly easy to make a course correction. Just do it! It will help.
The biggest mistake you are probably going to make is hiring B or even C players for key director and VP positions when you get your startup going. This will set you back many, many months. Time and money lost investing in a key individual who simply doesn’t deliver in a critical position.
As a first-time manager, you really won’t have the experience to know really who is an A, B or C player for any position you haven’t held yourself.It’s hard to judge if you haven’t done it before and/or if you are a first-time hiring manager. How do you really know who is a decent director of product management when you’ve never even worked with one, for example?
But there is an easy hack / fix: get an advisor / mentor who has done it before — and well — to interview your final list Continue reading "How to Know if a Key Hire is an A or a B (or even a C)"
I am fairly confident there are at least 10,000 Medium posts, 20,000 WordPress articles, and over well over 1,000,000 Tweets on How to Get Funded.
It bores me personally, but I know it’s an important topic. Raising money for many CEOs is one of the their top 5 priorities. Without venture capital, I’d be nowhere. Both of my first two-startups were venture-backed. And it’s a weird, strange world that until recently was highly opaque.
Now having been on three sides of the table
— founder 3x, worked at someone’s VC firm, solo investor — I’d like to take a moment to boil down all the possible advice I could into one learning:
The Highest Chance You Have to Get Funded is When the VC Already Wants to Invest Before The First Meeting. Before
you’ve even met him or her.
Trust me. VCs claim to
Continue reading "The One Best, “Secret” Hack to Getting Venture Funding"
There’s a lot of stuff written on how much to pay yourself as CEO. Christoph Janz has a great spreadsheet of quantitative thoughts here.
Having thought a bunch about it, I think I can distill it down to 3 general guidelines:
- In the very early days, the CEO should be one of the worst paid. Until you have material revenues and/or funding, the CEO should ideally only take out the minimum she needs. If you are taking more out before $1m or $2m in ARR (or a large round) than you need to survive, something is off.
- Post-Initial Traction, and the hiring of a VP or Two — the CEO should probably be the 3d best paid. Hopefully, your VP of Sales is doing so well, she makes the most — not in base salary, but in salary + bonus. Then, hopefully, you’ve hired another Great VP that is so Continue reading "How Much Should the CEO Pay Herself?"
Few things will frustrate you more in the early days than long sales cycles on bigger deals. A great logo will come in … but they’ll talk about maybe deploying at the end of the year. Maybe. You’ll feel like you just don’t have the time for a 6, 9 or even 12 month sales cycle when you’re struggling just to put the first few points on the board. You’ll feel like any customer you can’t close this month, or at least this quarter, is tantamount to a forever.
My #1 bit of advice? Get past it — fast. You have to think about Going Long even in the very earliest days. Even when if you’re honest, you’re not even sure you’ll make it another quarter. Because longer sales cycles are just part-and-parcel of larger checks. And for most of us,
Continue reading "How to Cope With Long Sales Cycles"
We’re in the final stretches of the year, and hopefully, you already met the plan for the year back in November. Things are good. Everyone is thinking about the Stretch plan, or even, the Super Stretch plan.
I hope so.
But the reality is, a lot of you will have had a rough year
. Even a Year of Hell (more on that here
). We all have at least one. I sure did.
And for most of us, there’s one natural reaction: Hide
. Put your head down, and grind it out. Try and get that one more customer in the door. Push harder. Analyze that data more. Cut the burn. Lay low and just “focus” until you can get growth back on track. Stare at that monitor, until you figure it out.
It’s natural, but please, don’t do Continue reading "Rough Year? Don’t Hide."
A curious thing happened on the way to SaaS in 2017. Everyone became an expert in churn.
Your churn rate should be 0.123909% per month. It should be net negative. You need to retain 118% of your revneue. Etcetera, etcetera. You will get a lot of advice here.
Most of these insights are directionally accurate, but here’s the thing. Churn is not a GAAP metric. It doesn’t have a universal definition. In fact, Christoph Janz had a great post
the other day noting how even public companies define churn differently. Read it here:
I learned this myself starting out as a SaaS CEO. I compared us to the only public company in our space, and noted a curious thing. This public company did break out churn in their public documents (not every company does). But they excluded
Continue reading "If Nothing Else – Segment Churn"