SaaStr

JULY 19, 2024

The worst investments for me have one common theme: The founder was a bit of a B.S. I still invested. The post The One Thing My Worst Investments Had in Common appeared first on SaaStr. It’s a fine line between being a salesperson, and being the #1 evangelist and advocate … and being a B.S. It’s so hard.

Investment 295

Investment Churn 295

SaaStr

MARCH 26, 2024

Since then, I’ve made some pretty good other investments as well. The top reasons an investment has turned out to be a Zero: #1. The post The Investments Where I’m Going to Lose All My Money appeared first on SaaStr. cash Second was Algolia leading U.S. But also, I made some that … weren’t.

Investment 327

Investment Scale Churn SaaS 327

SaaStr

OCTOBER 30, 2024

We’re obviously written up a lot about Fundraising and Investing here on SaaStr.com, but time and time again, SaaStr CEO and Founder Jason Lemkin has seen so many Founders sign a bad term sheet based on gut instinct, VC celebrity or vibes, and while that may be fine, it’s not enough.

Venture Capital 314

Venture Capital Software Review Investment Startup 314

SaaStr

SEPTEMBER 20, 2024

Dear SaaStr: Do angel investors or seed venture capitalists normally ask for detailed budgets including cash flow analysis before investing, even though most of the numbers will be pure speculation? The post Do Angel Investors and Seed VCs Ask for Detailed Budgets Before Investing? When it is, you can learn a lot.

Investment 306

Investment Sales Hiring Business Model Sales 306

SaaStr

MAY 18, 2024

Dear SaaStr: Have You Ever Made a Very Risky Investment That Paid Off Big Time? More of the story here: The post Dear SaaStr: Have You Ever Made a Very Risky Investment That Paid Off Big Time? In my first start-up, the VCs pulled our term sheet between signing and closing. But sometimes … you just do it. appeared first on SaaStr.

Investment 304

Investment Leadership 304

SaaStr

JULY 9, 2024

Those rare investments that return enough money to the VC fund to pay off at least 1x the total fund size. And you can see VCs are often pretty careful to make sure structurally, any given investment can do it. Investing in the #3 or #4 in a space? It’s not what anyone hoped when they invested. A 1% stake?

Investment 305

Investment Venture Capital Social Media Startup 305

SaaStr

DECEMBER 23, 2024

Share everything anyone would want to know to invest in you. But unless you are raising from folks that truly invest pre-revenue, investors are going to want to see 3 strong months of growth in a row. If nothing else, point out an existing investment or two theyve made that is somewhat similar to yours. # Share it all.

Venture Capital 276

Venture Capital Investment AI Metrics 276

SaaStr

DECEMBER 20, 2024

Having led sales teams of 500+ at BILL and 800+ at HubSpot, Michelle has unique insights into what makes great frontline managers and why investing in them is crucial for sustainable growth. “At HubSpot, I had over 100 frontline sales managers reporting to me. ” The bottom line?

Sales Hiring 262

Sales Hiring Scale Underperforming Technical Team Sales 262

SaaStr

JUNE 22, 2024

Dear SaaStr: Would You Invest in a Start-Up With 6 Co-Founders? UPDATED The post Dear SaaStr: Would You Invest in a Start-Up With 6 Co-Founders? I’ve done it — once. At least with 5 true co-founders. And that startup did end up selling for over $1 Billion (!) — so it’s not a firm “No.” But it did have the exact issues you’d expect.

Investment 262

Investment Compensation Startup Scaling 262

SaaStr

MARCH 22, 2024

Dear SaaStr: How Can I Convince My Investor We’ll Double Their Investment By The Next Round? If you are a VC / private investor, there’s a key meta question: why invest now ? There are really two, related answers to “let’s wait” One is because if you don’t invest now, it will be too late.

Investment 287

Investment Pricing 287

SaaStr

FEBRUARY 24, 2024

Dear SaaStr: What Is The Average Time it Takes a VC to Make an Investment Decision? For hot seed and even Series A investments? The average VC basically makes the initial decision to tentatively invest very quickly — pending due diligence, confirming her theories are correct, and making sure what they think is the case actually is.

Investment 287

Investment Leadership 287

Tom Tunguz

NOVEMBER 7, 2024

In a daring feat of economic analysis, I asked it to calculate if the after-tax returns of two ETFs were statistically significant & to compare the energy portfolios using the 13-Fs of a few hedge funds for investment ideas. ” Yesterday, I decided my blog theme needed a refresh. To create this post, I used a cascade of AIs.

Artificial Intelligence 185

Artificial Intelligence AI Engineering Investment 185

SaaStr

NOVEMBER 17, 2024

3 Came from the Investment Bank They Hired. In my experience, hiring an investment bank to help you in any acquisition > $100m or so is critical. Hit $20m ARR, growing 30%-40%, with little to no burn, and PE firms will begin to find you. #2. They Ran a Crisp, Tight Process And Got 4 Offers to Buy Them.

Sales Hiring 296

Sales Hiring Banking Sales SaaS 296

SaaStr

NOVEMBER 13, 2024

But it’s clear that it’s still in the investing phase, and increasing spend in sales & marketing. Outside of a pre-IPO phase, Klaviyo has been cash-flow positive or close for most of its history. Today, it’s steadily driving its margins up, now up to 14% non-GAAP operating margins.

Scale 304

Scale SMB Scaling Enterprise 304

SaaStr

NOVEMBER 2, 2024

Having been through 4 acquisitions in different forms (founder, exec, etc), it’s a lot like a venture capital investment. A ton of time is invested negotiating price, and then way, way too much time on inconsequential legal terms, and then … it closes. Usually, there isn’t actually a ton of time to really get to know each other first.

Venture Capital 263

Venture Capital Acquisition Investment Technology 263

SaaStr

OCTOBER 25, 2024

It’s now falling to 150 because 81% percent of the dollars invested in venture capital at the height of the boom came from non-traditional venture capital firms which are all very likely to leave investing. US venture funding went from 8 to 300 over 15 years.

Venture Capital 333

Venture Capital Marketing AI SaaS 333

SaaStr

FEBRUARY 11, 2025

The winner(s) will receive funding from the Mayfield AI Garage, who are at the forefront of investing in cutting-edge tools at the intersection of SaaS and AI. You could win $500K – $5M in funding from Mayfield AI Garage!! That’s right. This is epic opportunity to showcase your AI Startup. Win $500k – up to $5M in funding.

AI 303

AI Startup Innovation Investment 303

SaaStr

MARCH 23, 2025

Invest early in supporting functions Don’t underestimate the importance of enablement and revops in driving growth. ” Delayed investment in enablement “I wish we’d hired our first enablement person two months earlier. We let sellers ramp without proper resources for too long, which cost us deals and momentum.

Sales Recruiting 245

Sales Recruiting Sales Hiring Scale AI 245

SaaStr

OCTOBER 31, 2024

Basically I only invest in first-timers. First-timers do just as well, if not better, than second-timers. And they are much more capital-efficient. Not always, but often. And they lack the biases of second-timers. The post 6 Of The Most Common Mistakes I See First Time SaaS Founders Make appeared first on SaaStr.

Scale 310

Scale SaaS Social Media Business Model 310

SaaStr

DECEMBER 26, 2024

I havent done that, but Ive done handshake deals in one day in maybe 50% of my investments (i.e, Not literally months to do the homework that doesnt take long but sometimes months to see enough progress for the investment to make sense to me, to connect enough dots. Yes, term sheets get done in one day.

Investment 246

Investment Pricing Leadership 246

SaaStr

OCTOBER 22, 2024

In my ecosystem, most do another start-up, invest, or do something related: For some, it’s ego. Dear SaaStr: Why Do CEOs Keep Working After Making a Lot of Money? It’s a great question. Some don’t keep working. Some are happily retired. But not most in my ecosystem. For some, they get bored. For some, it’s to go even bigger.

Investment 275

Investment 275

SaaStr

DECEMBER 30, 2024

There are really three modes from a VC perspective during a fundraising pitch: You Almost immediately want to do the investment. This is 80%+ of the investments Ive done. Almost all my investments at SaaStr Fund , Ive told the founders before the meetings end that Im in if everything theyve said checks out. The Likely Nos.

Startup 262

Startup CTO Investment Marketing 262

SaaStr

NOVEMBER 20, 2024

Don’t underestimate the investments you need to make here to be compelling to your customers. Another big investment during rapid growth is digital moments. You want to invest time and energy here so that partners are ready to talk to customers. Then, package that up into a narrative that makes sense.

Scale 263

Scale AI Scaling Marketing 263

SaaStr

NOVEMBER 19, 2024

But I’d say 90% of SaaS companies I work with and have invested in don’t get these basics right for a long, long time. Even if churn isn’t that high today — it likely will be later. I see many SaaS start-ups with mediocre retention with … mediocre NPS (20-30). Yes, a lot of this sounds basic. Not for real. NPS is A Great Core Metric.

Churn 273

Churn Retention Scale Investment 273

SaaStr

MARCH 17, 2025

Massive investments, at massive valuations, into the biggest leaders of AI. Now there’s a lot going on here and part of the rush in 2024 and 2025 is that more capital is coming into VC again. But it still shows where the energy and momentum are. At a scale we haven’t seen before.

Venture Capital 316

Venture Capital AI Scaling Investment 316

SaaStr

JANUARY 14, 2025

Their “sense” of what things cost is often just way too low once they start to invest the first round of VC capital they raise. And how much that dramatically drives up the burn rate and cost of doing business. Dramatically. This especially bites founders that get pretty far bootstrapping.

Startup 276

Startup Finance Engineering Investment 276

SaaStr

NOVEMBER 19, 2024

Organizations that invest heavily in customer success earlier see much higher customer retention and loyalty than the competition. But you have to be intentional and clear on what and where you want to invest to drive that high-value impact. You’ll likely retain these long-term, dedicated customers and brand ambassadors.

Customer Success 287

Customer Success Scaling Social Media Enterprise readiness 287

SaaStr

DECEMBER 27, 2024

The losses arent equal, and you can mitigate them by not making further investments. Why $300 Billion? Roughly, VCs model losing money on about 40% of their deals, but only 20% overall. So if roughly weve raised $300B a year over the past 5 years, more or less then 20% of that total would be $300 Billion.

Startup 246

Startup Investment Data 246

SaaStr

OCTOBER 29, 2024

Others will have to accept much lower returns, at least for folks that invested in 2020-early 2022. It’s Just Time to Finally IPO, even if valuations haven’t back. It’s just time. OneStream was arguably one of these, and PE made a big gain on the IPO. It just filed to IPO.

AI 315

AI Cloud SaaS Investment 315

SaaStr

MARCH 16, 2025

And dont underestimate the power of PRpodcasts, blog posts, and events can make a big difference in attracting talent. Dont wait too long to make this hireits worth the investment. Close Like Your Life Depends on It Dont assume your charisma alone will close candidates. Get it right, and youll set yourself up for success.

Software Review 164

Software Review Interviewing Engineering Startup 164

SaaStr

DECEMBER 16, 2024

I’ve later co-invested with VCs that treated me pretty poorly, at least IMHO. Everyone knows this. If you refuse to work with VCs that have never done something remotely questionable your VC network will end up being close to zero partners. I doubt they ever realized they did. Three, let it go. Man, its hard.

Investment 249

Investment Business 249

SaaStr

MARCH 24, 2025

And while the Wiz deal hasn’t closed yet, seeing a record M&A deal price fuels more VC investment. billion+ exits for U.S.-based based start-ups just in 2021! So good times are back. In part, because they see the absolute potential exit sizes just going up and up.

Acquisition 245

Acquisition Cloud Pricing Investment 245

SaaStr

APRIL 5, 2025

SEO: How Rupa Health Dominated Search with Programmatic SEO and AI Rupa Health invested heavily in search, aiming to own the top spots for specific lab tests and biomarkers. Invest in scraping and cleaning tools, and make sure your emails are personalized to grab attention. Pro Tip: Outbound sales rely on data quality.

Scale 231

Scale AI Search Sales Hiring Acquisition 231

SaaStr

OCTOBER 28, 2024

share of the profits on the investments) for a long time, if ever — and your job likely will be to hunt. It takes a long, long time for early-stage funds to make “distributions” of their profits from investments. VC looks a lot more glamorous than it is.I To bring in the next Slack, the next Datadog, the next Shopify. And that is hard.

Sales Hiring 304

Sales Hiring Compensation Branding Investment 304

SaaStr

APRIL 3, 2025

But that’s probably not what the VC that just invested in you makes. “Carry” in the column on the left is how much of the gains on the investments per fund they keep. So that “Partner” that invested in you might have 4%-7% carry or less if they don’t run the place. Now that’s cash comp.

Investment 211

Investment Management 211

SaaStr

JANUARY 1, 2025

In fact, in 90% of SaaS IPOs, the founder CEO is still the CEO at IPO: SaaS CEOs That Go The Distance, To IPO … Tend To Be Founder-CEOs (Updated) Of all the investments Ive made since 2013 , in only 1 have the VCs replaced the CEO. Almost all VCs want the founders to go the distance, if they are able and want to.

Venture Capital 261

Venture Capital Investment SaaS 261

SaaStr

DECEMBER 12, 2024

So theres a theme Ive been working on with all the SMB-focused founders I work with and have invested in: # 1. The Goal for SMB SaaS is 100%+ NRR. Easy in enterprise, hard in true SMB. # However, SMBs have a certain level of inherent churn. Thats often 3% a month or so.

Churn 275

Churn SMB Payments Payment Solutions 275