# Top 10 in Tech - What to know for Week ending May 14, 2021

Published: 14 May 2021
Canonical: https://www.top10in.tech/posts/week-ending-may-14-2021

## 1. SaaS METRIC OF THE WEEK: CLTV

This metric represents the average revenue that a customer generates before they churn - Customer Life Time Value. ChartMogul has a great [online calculator here](https://chartmogul.com/metrics/ltv/#calculate). Go to 'advanced mode' as this calculator references the traditional formula as well as [the David Skok version](https://www.forentrepreneurs.com/ltv/) (which is the advanced one, but viewed as being more realistic)....and [check here for a thought-provoking read](https://medium.com/point-nine-news/why-your-ltv-might-be-higher-or-lower-than-you-think-f35539291701)of why your LTV may be lower than you think.

Link: https://chartmogul.com/metrics/ltv/#calculate

## 2. SECOND ORDER REVENUE

Doubling down on LTV this week and a little contrary to the last link above Jason Lemkin claims that CLTV isn’t the whole story and often [references a term called "Second-Order Revenue"](https://www.saastr.com/its-not-just-cltv-its-your-trgcltv-that-matters-total-all-in-revenue-generated-by-your-customer/). He states that traditional CLTV analyses underestimate true revenue generated by customers by 50-100% (whaaaaat!!!) in most SaaS models selling to any businesses larger than SMBs.

Link: https://www.saastr.com/its-not-just-cltv-its-your-trgcltv-that-matters-total-all-in-revenue-generated-by-your-customer/

## 3. PITCH

The days of mandatory in-person pitch meeting to a VC are mostly behind us (at least for the foreseeable future). Pitching over Zoom is where we are at. Before you focus on getting the perfect lighting though - check these [16 rookie errors founder make pitching to VCs](https://www.saastr.com/16-rookie-errors-founders-make-pitching-to-vcs-and-passing-the-20-minute-test/) from Jason Lemkin and read here on [how you will be Zoom-judged by the VCs you are pitching to](https://www.nfx.com/post/how-vcs-judge-your-startup-on-zoom/).

Link: https://www.saastr.com/16-rookie-errors-founders-make-pitching-to-vcs-and-passing-the-20-minute-test/

## 4. CODE

Hard truth - some of your code is pretty stinky. [Take a read of this for the kind of bad smells your repo may have](https://hackernoon.com/how-to-find-the-stinky-parts-of-your-code-part-i-xqz3evd). Meh - but how much does it really matter? Well [here is a report from Stripe that gives you that cold-hard number](https://stripe.com/files/reports/the-developer-coefficient.pdf) and also calculates that the developer "community" is valued at about $3 trillion GDP globally.

Link: https://hackernoon.com/how-to-find-the-stinky-parts-of-your-code-part-i-xqz3evd

## 5. WEBSITE

Do you have a pretty high churn rate from your home page or landing pages? Maybe you have a trust problem.[This article outlining the Trust Pyramid is very much worth a read](https://www.nngroup.com/articles/commitment-levels/) but TL;DR A website must meet users' basic trust needs before a visitor can be expected to engage meaningfully. With the Trust Pyramid, there are 5 distinct levels of trust-based engagement, each with separate design requirements.

Link: https://www.nngroup.com/articles/commitment-levels/

## 6. GROWTH

For public SaaS companies there is a wealth of online benchmarks in regard to performance - but it is much harder to scratch the surface of private SaaS (when there is no compliance requirement to share the data). But here is a couple of reference documents for ya (both from SaaS Capital): 1) Growth - here is their latest report on [Private SaaS Companies' growth rates](https://www.saas-capital.com/wp-content/uploads/2020/08/RB-22-2020-Benchmarking-Private-SaaS-Company-Growth-Rates.pdf). Some snippets: It takes approximately 5 years for companies to reach $1 million in ARR, 87% of those surveyed reported annual revenue growth of greater than 10%. 2) I've posted about this before - but [spend is just an important measure as growth](https://www.saas-capital.com/blog-posts/spending-benchmarks-for-private-b2b-saas-companies/) - bootstrapped companies are obviously being outspent by venture-backed companies - the average is 80% of ARR to 115% ARR!!

Link: https://www.saas-capital.com/wp-content/uploads/2020/08/RB-22-2020-Benchmarking-Private-SaaS-Company-Growth-Rates.pdf

## 7. PRODUCT DEBT

This is a nuanced (and more customer-centric spin) on Technical debt: [Product Debt is just as bad as Technical Debt](https://medium.com/swlh/technical-debt-is-overhyped-lets-talk-about-product-debt-4b422a33894b) - it's all the decisions that have been made, often tactical and acute, without a clear product vision or sufficient consideration about the long term effects of that moment/decision. The link above also has a great case study of Google Messaging's product evolution.

Link: https://medium.com/swlh/technical-debt-is-overhyped-lets-talk-about-product-debt-4b422a33894b

## 8. CONVERTIBLE LOANS

They are a kind of debt [until they are not](https://medium.com/entree-capital/the-math-challenge-with-convertible-notes-safes-8352d250e43). But Convertible Loans are a quick way to access money quickly via an interested investor. Point Nine Capital [describes in detail what is involved in a convertible loan](https://medium.com/point-nine-news/convertible-loans-what-to-look-out-for-404e888ea0c2) and what to look out for.

Link: https://medium.com/entree-capital/the-math-challenge-with-convertible-notes-safes-8352d250e43

## 9. LANDING PAGES

One of the most common reasons why a search engine-based marketing campaign fails is that it does not have optimized landing pages to continue the journey, take a look here at some best practices, real examples, and templates for Google Ad-based Landing Pages. Then also [Check this site out](https://saaspages.xyz/) - a collection of the best landing pages around the web with a focus on copywriting and design - finally (this is a repeat-post) IceBreakerVC lists [best practices for good landing page planning and strategy](https://medium.com/icebreakervc/best-practices-for-b2b-saas-landing-pages-2b6f3e7cd1f0).

Link: https://saaspages.xyz/

## 10. CASE STUDY

STRIPE: Stripe just raised a new round, remaining private. It was a $600 million funding round that boosted its valuation to $36 billion - but how did they come out of nowhere to dominate the payments space? The answer: Developers! [They focussed on going after developers](https://blog.chartmogul.com/why-is-stripe-so-popular) — the main group of people involved in integrating payments into all kinds of digital applications.

Link: https://blog.chartmogul.com/why-is-stripe-so-popular

## POD OF THE WEEK

From Invest Like The Best this week is [an interview with Michael Seibel](https://podcasts.apple.com/us/podcast/michael-seibel-lessons-from-thousands-of-startups/id1154105909?i=1000490440953?i=1000490440953) - the CEO of Y-Combinator's startup accelerator - he has reviewed literally thousands of applications to YC.

Link: https://podcasts.apple.com/us/podcast/michael-seibel-lessons-from-thousands-of-startups/id1154105909?i=1000490440953?i=1000490440953