SaaStr

JULY 13, 2020

Q: What was your failed investment experience and where will you never invest funds again? I’ve made about 30 material investments. Most have been successful, but of course not all have and I’ve been reflecting on the ones that didn’t, because they still had attractive elements when I invested. More on them here.

Technical Cofounder 306

Technical Cofounder Investment New CTO CTO 306

SaaStr

MARCH 16, 2025

The best time to negotiate marketing pilot terms is in the last two weeks of a quarter – Vendors are more flexible with minimum spend and commitment requirements when they’re trying to close their books. Follow the Pilot-Repeat-Enlarge Methodology Pilot : Start small with minimal investment.

Scale 245

Scale Sales Hiring Scaling Marketing 245

Intercom, Inc.

JULY 2, 2020

For Pam, it all stems from a long-held belief that investing in the customer’s success will chart a direct path to the company’s. In the return of the Scale podcast, Pam details her support philosophy and the investments she’s making to drive better customer outcomes, for the long term. What are the financial implications?

Outsourcing Services 253

Outsourcing Services Investment Underperforming Technical Team Outsourced Development 253

Tom Tunguz

SEPTEMBER 30, 2020

I’ve been steadily progressing through the excellent books in the Stripe Press catalog. It’s the best book I’ve read on engineering management. The book abstracts out the wisdom of those times into theory abstracted from experience, not just hypothetical ideas. First, I read High Growth Handbook.

Engineering 363

Engineering Software Review Systems Review Technical Review 363

Tom Tunguz

DECEMBER 6, 2022

PLG companies R&D spend hasn’t produced new business at the same rate as a dollar invested in sales & marketing post-Covid. Some about the data: PLG companies R&D spend hasn’t produced new business at the same rate as a dollar invested in sales & marketing post-Covid.

Headcount 344

Headcount Market Research Acquisition Education 344

SaaStr

JANUARY 24, 2022

Was it misunderstanding bookings vs. ARR vs. GAAP revenue, was that the issue? It was too big a flag for a company at the edge of where I like to invest. Mistake #1: Bookings are not revenue. More often than not, the response is, “Well, our bookings are __”. My next question is then, “What do you define as booking?”

Finance 333

Finance Outsourcing Services Systems Review Technical Review 333

Tom Tunguz

AUGUST 20, 2020

The magic number answers the question: if we invest $1 in sales and marketing, how much new bookings can we generate? ZCP answers the question: if we invest $1 in sales costs (e.g., Both the magic number and NCP measure the efficiency of the go-to-market teams.

Metrics 347

Metrics Payments Banking Sales 347

Tom Tunguz

NOVEMBER 6, 2021

All of the sales and marketing dollars invested to obtain persuade the buyer to put digital ink to pdf have been recouped immediately. And the company has two years of marginal profit to invest in the GTM. But there is a viable GTM strategy for startups to book multi-year deals with pre-payment, and use that cash to finance GTM growth.

Sales Hiring 352

Sales Hiring Scale Payments Payment Solutions 352

SaaStr

JUNE 30, 2024

But … it almost always takes longer than you think than direct sales: Salesforce announced a little ways back that its partners were the #1 source of its new bookings. Invest long here. In the early days, invest heavily in any partners you have even 1 or 2 joint customers with. Invest in what is working.

SaaS 310

SaaS Investment Startup Revenue 310

Tom Tunguz

JULY 16, 2020

I’ve been searching for a book that combined the history, the people, and the emotional roller coaster of US economics. The book recounts five crashes: 1907, 1929, 1987, 2000, and 2010. But, the storytelling engrosses you, and you can imagine yourself reading the paper during those times, wondering how to invest.

Marketing 262

Marketing Banking Investment Technology 262

Sales Hacker

JULY 17, 2024

Her book, From Hoodies to Suits: Innovating Digital Assets in Traditional Finance , hit shelves in June. 26:02] – The main themes of her book “From Hoodies to Suits.” ” [31:49] – The potential for blockchain to democratize access to venture investing.[41:49]

Finance 124

Finance Blockchain Investment Compensation 124

User Pilot

MAY 29, 2024

He is the author of the best-selling books “Hooked: How to Build Habit-Forming Products” and “Indistractable: How to Control Your Attention and Choose Your Life.” Nir Eyal books product professionals should read The majority of people recognize Nir from his bestselling books.

Underperforming Technical Team 105

Underperforming Technical Team Consulting Engagement Technology 105

SaaStr

JUNE 7, 2024

To start adding eight figures and then nine figures of new bookings a year, it can really help to focus on bigger customers. They stop supporting, or at least investing, in their smaller customers. Klaviyo has SMB roots but is pushing hard at $50k+ deals as it approaches $1B in ARR. And bigger customers almost already have higher NRR.

Enterprise 326

Enterprise Scale SMB Investment 326

SaaStr

AUGUST 26, 2020

The other thing that VCs are doing is one very important part of their jobs, and that’s meeting companies and studying markets to figure out where they might want to invest eventually. And so, for all of those reasons, seed right now is a very different beast than Series and later-stage investing. Not the case to the seed stage.

Scale 315

Scale Investment Venture Capital Technical Review 315

SaaStr

SEPTEMBER 30, 2023

It can either be cheap in that the ROI is high — e.g., you make $5 back for every $1 you invest. pic.twitter.com/tomLUIbKhy — Dave Kellogg (@Kellblog) September 26, 2023 (need it book image from here ) The post Dear SaaStr: We Don’t Need It. Venture capital is very expensive in the early days, in terms of dilution.

Venture Capital 324

Venture Capital Investment Leadership 324

User Pilot

JANUARY 19, 2025

At first, this seemed like a smart investment for my company, so I invested. Reasons why you shouldn’t invest in standalone session recording tools You might think standalone session replay tools have one flaw, but theres more to the story. Reasons for not investing in standalone session recording tools.

Investment 52

Investment Scale Software Review Technical Review 52

SaaStr

FEBRUARY 14, 2024

While it saw some slowdown last year, it’s now accelerating again with 2 record quarters of new bookings in a row. Gottom Much More Efficient — But Still in Investment and Growth Mode Cloudflare has gotten much more efficient than where it was 2-3 years ago, like almost every SaaS and Cloud leader. Efficient Growth.

Cloud 276

Cloud Scaling Investment Revenue 276

SaaStr

FEBRUARY 13, 2021

Huge investment in marketing. GoDaddy is a marketing engine, investing $439,000,000 (!) in annual bookings. It doesn’t have to be there on Day 1. in marketing/ads in 2020. While GoDaddy sells multiple products to its customers, it still spends a lot in acquiring them. They did acquire 1.4 Google Domains).

SMB 320

SMB Cloud Scaling Investment 320

Clouded Judgement

OCTOBER 11, 2024

This behavior can create a surge in purchasing activity, as organizations look to make strategic investments without losing their allocated funds. As a result, software vendors often see an uptick in revenue and bookings during these periods. This is for information purposes and should not be construed as an investment recommendation.

Cloud 167

Cloud Cost optimization & reporting GCP(Google Cloud Platform) Software Review 167

SaaStr

JULY 20, 2024

Invest in People You want to keep the bar high on talent, especially in hypergrowth, and not just in the early stages. Invest Heavily in Onboarding Your typical employee takes about three to six months to get ramped. Invest Early in Your Marketing When scaling the GTM engine, you want to invest early in marketing.

Sales Recruiting 302

Sales Recruiting Sales Hiring Scale Engineering 302

SaaStr

JANUARY 11, 2024

What’s your most recent disclosed investment? What’s your sweet spot for investing — check size, stage, type of deal? Stage 2 Capital invests $4M to $6M in first checks into B2B software companies that are around $1M ARR. These investments typically occur between the seed and the A round. Check that out here.

Technical Review 304

Technical Review Scale Management Sales Hiring 304

SaaStr

AUGUST 5, 2024

You have to show a return on investment, so this value narrative is essential to secure renewals and build those business cases to expand into existing customers and go after net new customers, too. What is the time investment so far in implementing the software and training the team to get where it is? Where is there risk?

Scale 287

Scale Customer Success Scaling Revenue 287

Tom Tunguz

FEBRUARY 2, 2021

Today, she advises and invests in companies on these topics and others. She’s written extensively on the topic and co-authored a book The Customer Success Economy. Allison is an incredible builder of teams. In addition to talking about the evolution of customer success, Allison and I will talk about the COO role.

Scale 299

Scale Sales Recruiting Sales Hiring Customer Success 299

SaaStr

SEPTEMBER 11, 2024

Not Profitable Yet — And Probably Taking a Short-Term Hit Because of It Rubrik’s growth is one for the record books, but it’s still investing heavily in growth and isn’t getting more efficient. It’s at a super impressive 120% #2. Free cash flow margins are still negative at -12%.

Cybersecurity 308

Cybersecurity AI Cloud Scaling 308

SaaStr

SEPTEMBER 10, 2020

And I’ve seen it across my little investment portfolio too, from startups like Gorgias tripling on the back of the acceleration of eCommerce, to Talkdesk booming as call centers have to move to running distributed in weeks, to RevenueCat and others benefitting from an explosion in app development. Still very impressive, but slowing.

Cloud 293

Cloud SaaS Mobile Enterprise 293

SaaStr

FEBRUARY 27, 2024

GTM Composition Can Make or Break Profitability and Growth More specifically, Sapphire has seen that the percentage of investment made against quarter-carrying sellers has dropped in the last 6 years. So back in 2018, on average, what we were seeing was around 30% of Go-to-market investment going to quota-carrying sellers.

VP of Engineering 276

VP of Engineering Scale Marketing Benchmarks 276

Tom Tunguz

MARCH 1, 2025

In their most recent quarterly earnings, the company clarified the breakdown in their book of business : 20% software & 80% consulting. While precise total market figures remain elusive, the trend is clear: hardware investments still outpace software and services revenue in today’s AI landscape.

AI 247

AI Revenue Azure Consulting 247

Tom Tunguz

MARCH 13, 2022

their business predictability diverges wildly: Mongo reports bookings, net dollar retention, customers worth more than 100k in contract value. After all, an investor looking to buy the best database investment will have to choose between Ethereum and Mongo (amongst others). they trade on separate exchanges.

Startup 305

Startup Scale Retention Enterprise 305

SaaStr

JULY 8, 2024

They are: A sense of ownership Investing in team development Theme 1: A Sense of Ownership Employees who feel connected and have a sense of ownership within their organization tend to stay for longer periods. Theme 2: Invest in Team Development Team development can happen in two powerful ways. Invest in team development.

Sales Hiring 290

Sales Hiring Scale Sales Education 290

SaaStr

JUNE 5, 2020

Carlota Perez argues in her book Technological Revolutions and Financial Capital that in the early days of a “golden age”, financial capital is necessary to fuel new technology innovation. . Geoffrey Moore calls this group the Late Majority and the Laggards in his book Crossing the Chasm , a secret bible for many SaaS CEO’s. .

Venture Capital 298

Venture Capital Technical Review SaaS Scale 298

SaaStr

JANUARY 31, 2024

If you'd just invested in ServiceNow's IPO You'd be up 3,094.02%!! Seeing Strong Bookings As Well Going Into 2024. at that scale, with 1,900 $1m+ customers. And it’s trading now at an all-time high of $160 Billion, or 16x (!) Far, far ahead of the average of 6x today. jasonlk) January 30, 2024 Wow.

Enterprise 315

Enterprise Scaling Churn Engineering 315

Tom Tunguz

NOVEMBER 16, 2021

What an arresting title for a book. In the first few pages, I learned that it’s a book about rhetoric. In the book, Sam Leith deconstructs the works of evocative orators: Aristotle, Cicero, Churchill, Luther King Jr., The book enumerates the troika of persuasive arguments: ethos, logos, and pathos. I was wrong.

Education 247

Education Investment 247

SaaStr

JANUARY 28, 2025

The Importance of Owning a Category The book “Play Bigger” suggests that buyers today make decisions around buying categories, not products, and companies should aim to own a specific category in the buyer’s mind.

AI Search 244

AI Search AI Artificial Intelligence Technical Review 244

SaaStr

APRIL 20, 2022

Invest here if that’s you. #7. Confluent is still investing in hyper-growth, and may like Snowflake not end up generating significant free cash-flow until $1B in ARR or so. Having said that, burning a net $100m a year isn’t that huge given the company is adding $400m in new bookings.

Scale 62

Scale Cloud Headcount Scaling 62

Tom Tunguz

MAY 10, 2019

And since expanding an existing customer costs significantly less than acquiring a new one, these expansion dollars require far fewer (and potentially zero) sales and marketing investment. If a majority of bookings come from expansion, then the business develops an incredible sales efficiency. Let’s walk through an example.

Development 270

Development Sales Acquisition Retention 270

SaaStr

AUGUST 9, 2024

A case study in the book In the Age of the Smart Machine, The Future of Work and Power discusses work at paper mills in the mid-1980s as that wave of computation came into industrial processes. The quicker you can be smart and make early investments that pay off, the better off you’ll be. Side projects are not a recipe to scale.

Scale 294

Scale Sales Hiring Scaling Startup 294

SaaStr

FEBRUARY 20, 2024

A Word You Don’t Often Hear When Building Territories is “Dynamic” We oftentimes treat our book of business as static — keeping the same reps on certain accounts for as long as possible, and giving them very set terrioties or accounts to work with. So, instead of dynamic territory books, they moved to just dynamic books.

Scale 275

Scale Sales Marketing Construction 275