The weekly top 10 for B2B tech operators · Every Friday
Chartmogul notes that retention strategies are now growth strategies in their SaaS Growth Trends in 2023 report. Why is that? It's because companies with best-in-class retention grew at least 1.8x faster than their peers. Check out this other great ChartMogul article that outlines how to calculate, benchmark, and track retention (along with some good ol' fashioned strategies).
Balancing the needs of existing vs. new customers is a hard product act to balance, and that push and pull is nicely described in this article, which includes some great analogies and tips on influencing the product roadmap. It also includes an article from First Round Review with a list of things to avoid when building highly technical products.
For some of you, the new Financial Year just started, so check out some of this help for your Financial Year plans: Bessemer has a great six-part "fundamentals of startup finance" series: Part 1 (Goldilocks Budgets), Part 2 (Forecasts), Part 3 (Hiring), Part 4 (Growth and Profits), Part 5 (Pricing), and Part 6 (Metrics and benchmarks).
Another new entry for the Tech Dictionaries, The Trigger Technique outlined in this article,shows how to leverage customer interviews to learn what "triggers" potential customers' buying decisions. This information helps design more targeted marketing campaigns to boost sales.
According toCrunchbase data, Global Venture Funding was up in Q1 this year, but not by much ($66B). In fact, it was the second-lowest period on record (by volume) since the start of 2018. Of that $66B, Seed and Early Stage pulled in about $3B. At later stages, the VC pullback continued (falling 35% YoY) to $29.5B. Carta agrees that it was in the "slightly better" category; here is their summary.
Did your team or company miss revenue goals last quarter? If so, you are not alone, as according to data in this article, 56% of companies fell short of their revenue goals. Marketing pipeline and sales velocity are also down, which are pretty key indicators that revenues will be down the next time this data gets refreshed (towards the end of the year).
Just how profitable should a SaaS Company be? This article from OnlyCFO looks to benchmark profitability data in SaaS, and here are the main takeaways: Gross Margins are Crucial: Companies with low gross margins (around 50%) face a hard limit on profitability, even with efficient operations (one of the reasons SaaS is favored); As SaaS companies grow decreases in OpEx as a percentage of revenue should occur, as should Sales and Marketing costs (typically the biggest component of OpEx)
This intriguing article argues that SEO is becoming less reliant (thanks AI), so it advocates for identifying channels with high potential (via research of where the ideal customers are active, etc) using a Channel Growth Quadrant (I love me some quadrants). Great ideas for sometimes overlooked distribution methods. Adding onto this is the concept of "being where you matter" - and cynically, communities are not where that is (it's channel)
One more for the tech dictionaries. CLG stands for Customer Lead Growth, which is just another term for old-school referral engines or word of mouth. It's the most operationally efficient channel an operator could hope for. Download this "definitive guide" from Catalyst. Deloitte is even in on the acronym with their perspective. Userpilot breaks CLG down vs. PLG here.
Intercom's Des Traynor and Fergal Reid share insights on leveraging AI language models (like GPT-4) to transform Intercom's SaaS products, highlighting the importance of low-risk problem selection and a centralized ML team.
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