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Dear SaaStr: How Much Should a SaaS Company Invest in Professional Services? Now how much to invest is a different question. Up to 20% of the ACV is usually OK and you will still be seen as a software business, not a services business. At $500m ARR, OneStream gets about 8% of its revenue from professional services.
I’ve invested almost $200m as part of SaaStr Fund / 2024. Make the cold email so great, you’d want to invest based on just it alone. Make the cold email so great, you’d want to invest based on just it alone. Is this the type of investments they do? VCs don’t expect investments to be perfect. They right stage?
GTMfund’s 3 Areas of Focus for Investing Thanksgiving weekend is always a period of reflection and gratitude. Reflection across go-to-market trends, but also on the investment front (not to mention community !). A common misconception is that the name is representative of the type of software we invest in.
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? What do they think the key drivers of the business will be? Do they really understand their business model?
The digital age has brought about increased investment in data quality solutions. Businesses are realizing that it isn’t just about the volume of data they have available; it’s about the accuracy of information. 64% of successful data-driven marketers say improving data quality is the most challenging obstacle to achieving success.
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.
Increasingly, you’ll hear the term “business outcomes” popping up in software marketing. While I initially loathed the phrase for its vagueness, over time I’ve come to believe that, much like the frequently abused word “ solutions ,” there is a right and a wrong way to use “business outcomes.” It’s not great.
Instrument Everything Before running campaigns, ensure you have rock-solid data collection: Define clear metrics tied to business outcomes Create instrumentation that accurately tracks performance Focus on data that’s “directionally correct” – perfect precision isn’t required 4.
Six months ago, security was the number one prohibition preventing businesses and software companies from buying AI. This can destabilize your business and have a big impact on cash. So the survey asked how much as a business has AI impacted its sales funnel. So how much business has it closed? It isn’t predictable.
Whether it’s a business deal or a personal connection, they are a driving force to solidify a foundation of trust. Enter conversational marketing — the new paradigm to tackling your business deals and converting prospects in minutes. Conversations have always been at the heart of our most authentic relationships.
So venture capital turns out to be a pretty tough business. 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? A 1% stake?
G2 had us back for another great deep dive on just where SaaS investing is there days, and it was a great panel: Accel Partner Arun Mathew Inspired Capital Founder & Managing Partner Alexa von Tobel Salesforce Ventures Managing Partner Paul Drews and Jason Lemkin! Low investment multiples pose a key challenge.
The document contains a plethora of information on the company including a general overview, up to date financials, risk factors to the business, cap table highlights and much more. The purpose of the detailed information is to help investors (both institutional and retail) make informed investment decisions.
Software companies don’t invest once in R&D & then sell copies of the software as we did in the 90s on CDs. 1 Despite the enthusiasm from Investopedia, I think it’s important to say that no financial metric is perfect & all of them are proxies for the ultimate performance of a business.
It's a simple, frustrating truth that you can't predict everything when it comes to recruiting for businesses. It's important to also invest in building a passive candidate pipeline. However, it's not efficient or cost-effective to be in the active recruitment mode all the time.
APIs (Application Programming Interfaces) are at the heart of this transformation, enabling businesses to create customized payment workflows that meet the unique demands of their operations. API-driven payment systems reduce processing times by up to 40%, improving cash flow management for businesses of all sizes.
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.
Dear SaaStr: Does Bootstrapping Through an Agency/Services Business Work? Running two businesses at once well is really, really hard. I’ve invested in Logikcull and been an advisor to Showpad, both of which are successful and did just that. They slowly wind down the services business and stop investing (e.g.,
A New GTM Mental Model for AI Products That feedback told GitHub that people who weren’t using the GitHub platform still wanted to use Copilot for Business. They ended up shipping Copilot for Business for non-GitHub Enterprise users, which was a commercial success. Another big investment during rapid growth is digital moments.
Speaker: Peter Cowen, Managing Director, Sutton Capital Partners & Tim Draper, Founder, Draper Associates
Join Peter Cowen, Managing Director at Sutton Capital Partners, with top VCs looking at the trends and perspectives on investing in today’s climate. Come join us for any of these sessions to hear from these top seasoned investors and get answers to these questions: How are VCs now looking at investing in the short term?
Here’s what I see most often, the Top 6 Mistakes First Time SaaS Founders Make: Incomplete understanding of business model, and how it will scale. Basically I only invest in first-timers. But they also make mistakes we tend not to make with experience. First-timers do just as well, if not better, than second-timers.
Its a tough business, with sharp elbows, and half promises. I’ve later co-invested with VCs that treated me pretty poorly, at least IMHO. Move on and focus on your business. I know, but the thing is, someone else will still take their money. Also, no one really thinks VCs are saints. Everyone knows this. Three, let it go.
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.
And how much that dramatically drives up the burn rate and cost of doing business. 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. Dramatically. This especially bites founders that get pretty far bootstrapping.
According to several business analysts and practitioners, ABM is a necessity for creating more predictable revenue. In times of economic uncertainty, account-based strategies are essential. Research shows that nearly three-quarters of marketers (74%) already have the resources needed to build successful ABM programs.
The Expert Panel Karen Paige, General Partner at B Capital Karen brings deep operational and investment expertise to B Capital, where she focuses on enterprise software and AI investments. While 50% of enterprises have dabbled in AI projects, most are still playing around the edges rather than transforming their core business.
Consumers now also expect to talk to businesses through digital means. Onboarding, especially for vertical saas products and tools that oftentimes utilize hardware or require a vendor like a Mangomint to ingest 10+ years of existing data on the fly, is an order of magnitude harder since these businesses are open every day.
Ryan’s previous company, ImportGenius , was the largest provider of business intelligence to the import-export industry, which gave them access to an extremely valuable list of customers, trade data, and understanding of the international trade market. Measure customer NPS early and make it a key KPI for the business.
Organizations that invest heavily in customer success earlier see much higher customer retention and loyalty than the competition. Your company is going to change business goals every year, and your customer success strategy has to move towards and align with those priorities. Pick Your Battles That Drive ROI What does that mean?
But we can take the right actions to prevent failure and ensure that AI systems perform to predictably high standards, meet business needs, unlock additional resources for financial sustainability, and reflect the real patterns observed in the outside world.
. “I will say this to all of the founders out there too, that as much as you want to be the face of the business, you don’t want to be the totality of the business. The playbook shifts: heavy investment in domain experts to build the brand in a trusted way, and local market adaptation is key. In the U.S.,
I try to look at two things in Vertical SaaS startups, at least when investing : Will everyone in the vertical / industry use it? Even a fairly small business can pay $10,000-$20,000 a year for one app, usually. and Is the app so core, or at least is on a path to become so core, that they can charge $20,000+ a year for it?
A Philadelphia native, Colin started his professional career as a Business Development Representative (BDR) 14 years ago and worked his way up to his current role as CRO. This approach required immense trust from the CEO to invest millions ahead of proven results.
So theres a theme Ive been working on with all the SMB-focused founders I work with and have invested in: # 1. You can still make them super happy, but a subset of small businesses will churn at that rate anyway. # The Goal for SMB SaaS is 100%+ NRR. Easy in enterprise, hard in true SMB. # Thats often 3% a month or so.
Join Peter Cowen, Managing Director at Sutton Capital Partners with top VCs looking at the trends and perspectives on investing in today’s climate. Come join us for any of these sessions to hear from these top seasoned investors and get answers to these questions: How are VCs now looking at investing in the short term?
Im investing in fact at SaaStr Fund in a solo founder right now. It could be a VP of Product, Sales, or Engineeringsomeone who takes ownership of a big chunk of the business and cares almost as much as you do. If youre business-focused, hire a strong technical lead. Dear SaaStr: I Have No Co-Founder. What Should I Do?
Many of the fundamental business models that were once engraved in the SaaS playbook are now changing thanks to a tougher macro environment and a maturing market. PST, Stephanie Opdam, Partner at Notion Capital, shares four business model changes that will allow SaaS companies to build resilience and staying power over time.
In 2006, BILL CEO and Founder René Lacerte set out to define a category around financial operations for small and midsize businesses (SMBs). ’ Bill is approaching half a million customers, so has a good pulse on small businesses. With SMBs, the smallest business is owner-operated. Needless to say, he succeeded. in revenue.
Turns out, I’m not alone: A study by HubSpot found 31 percent of participants saying that an About Us page is one of the most important elements of a business website. It’s not what will initially provide you with the most return on investment (ROI) , either. How do you operate in your day-to-day business?
Speaker: Peter Cowen, Managing Director, Sutton Capital Partners & Ben Narasin, Venture Partner, NEA
Join Peter Cowen, Managing Director at Sutton Capital Partners with top VCs looking at the trends and perspectives on investing in today’s climate. Come join us for any of these sessions to hear from these top seasoned investors and get answers to these questions: How are VCs now looking at investing in the short term?
Engineering resources: With thousands of engineers, companies like HubSpot can make substantial AI investments when they choose to 3. The Future of AI in Customer Support While many vendors are achieving similar baseline results with AI customer support, Brian believes we’re still early in unlocking its full potential.
Moving upmarket isn’t just a nice-to-have for most SaaS companies – it’s often the difference between building a sustainable $100M+ ARR business and getting stuck in the mid-market quicksand. But the rewards – higher retention, bigger deals, and ultimately a much larger TAM – make it worth the investment.
Joselyn Goldfein , Managing Director at Zeta Venture Partners, which invests in AI and data infrastructure-focused startups from inception through seed stage And see everyone at 2025 SaaStr Annual, May 13-15 in SF Bay!! The bar has risen significantly from the “growth at all costs” mindset of 2021-2022.
They: Started with clear use cases Built a strong data foundation Focused on measurable customer value Invested consistently over time Maintained a human-centric approach For SaaS companies looking to leverage AI, the key is to start building your data advantage now, even if you’re using third-party tools.
Join Peter Cowen, Managing Director at Sutton Capital Partners with top VCs looking at the trends and perspectives on investing in today’s climate. Come join us for any of these sessions to hear from these top seasoned investors and get answers to these questions: How are VCs now looking at investing in the short term?
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