SaaS METRIC OF THE WEEK: CPA
cost per acquisition. This is often conflated with the cost of acquisition, but they are different. Andrew Chen dives into the details as to why (and also how to calculate CAC accurately).
Top 10 in Tech - What to know for the week ending May 21, 2021
VALUATION
Complete with a downloadable sheet for ya: This SaaS-Capital Index worksheet (Excel) can be used as a starting point for a comprehensive valuation analysis of a (your!) SaaS business. Check the whitepaper PDF here as the starting point to work through this Excel sheet (especially the bit on how revenue should be measured). SaaS-Capital also reports quarterly on how this valuation index is performing overall. An impressive observation specific to growth rate is that every 1% increase in growth rate corresponds to a 0.38 increase in valuation multiple (starting with a flat growth valuation of 5.1x ARR). All part of the growth-at-the-expense-of-profit strategies.
FREEMIUM
Freemium is continuing to gain popularity as an effective growth strategy for B2B SaaS companies. Canva and Slack have contributed to the re-emergence of this growth strategy. So, why is Freemium becoming popular again? Read more on that here, then check the 3 main flavors of Free and then these 3 Famous Freemium SaaS Strategies (And why they’re so good). But perhaps the more pragmatic article is from a company called Chameleon on making freemium models actually work for you.
CONTENT MARKETING
Mastering great content writing is a skill - and I've snagged a great guide for us all here on that topic and here is great info on how to plan a data-backed B2B content marketing strategy
SECURITY, SECURITY, SECURITY
If you didn't notice - a big US gasoline pipeline got ransomwared last week leading to some serious gas shortages. So time to revisit this: Security should be an integral part of your dev cycleand you need to know your weak spots. Founder Institute discusses 6 points of vulnerability in your tech stack that I bet may be a bit leaky. These high-profile breaches are going to make Due Diligence a lot trickier to navigate (there is a growing need for chief compliance officers for example). What should you start focusing on? Start with more detailed Log Management (listen to the Podcast below to understand why in the now infamous Solar Winds case)
SALES TEAMS #1
Betts Recruiting releases a compensation guide every year and the 2021 version is now out (Or check this for the more interactive version if you don't want the PDF). It covers salaries of some of the most important roles at high growth (mainly tech, mainly sales) companies. Big take-home: Covid hit hard in Sales this year. People moved out of the sales hots spots big time (of NYC and SF); AE's had the first year of no overall Compensation increase; SDR's saw about a 3% rise and; Sales leaders saw about 5% rise.
SALES TEAMS #2
Now that you have some great baseline metrics based on the reports above from Betts, take a good read of this article from David Sacks on the simple math you can use to set up a sales team. With Individual plans, team plans, and expansions/renewals considered for a high growth sales team structure.
SMS
Did you know that the average open rate for marketing emails is around 20%, while SMS open rates range between 82-98%. Check this article for this fact and more on SMS-Marketing basics.
BUSINESS MODEL
You will be asked often (especially when pitching) about your go-to-market business model: This is a pretty long, but very high value, read from Alex Jarvis with real-life examples of good business models (with some good humor thrown in). The business model is always more important than the product (but of course they both matter - but so does timing). There is a longer PDF version - so I got that for ya too.
CASE STUDY
Check this complimentary case study to #4 above on how Leadfeeder used a long-term Content marketing strategy to increase their monthly signups.