#17 Is the SaaS VP Sales model wrong. Too many layoffs in Customer Success. How to price AI features. High NRR is not necessarily good. Bezos bets on Google Challenger. And more...
January 15th, 2024
Insights, real stories and food for thought on SaaS and Customer-Centric go-to-market growth in both Tech and Traditional Industries. Maximum once per month in your inbox.
Manually curated by Luigi Mallardo.
My Work:
What’s wrong with the VP Sales model in SaaS.
Why most scaleups fail to find the right Revenue Leader. (1) Bad Timing. (2) Unreasonable Expectations. (3) Wrong Profile. (4) Inexistent Onboarding. Link.
As a CEO are you Bottleneck, Maradona or Down-To-Earth?
In my experience there are three types of CEOs in early stage SaaS. What's your profile?
Leadership Mantras
Everyone should have a list of personal and professional mantras. Something to remind ourselves regularly. The start of a new year is a good moment to do it. Here are mine. Link.
News on SaaSed-up companies
How to price and bundle AI features.
Takeshi Numoto has been the revenue architect of Microsoft cloud business from 8 billion $ in 2015 to 140 billion in the year ending June 2023. Now he faces the challenge of building the revenue model to convince customers to pay for AI tools. Link.
Never say never.
In 2020 Netflix founder Reed Hastings promised "No ads. Ever." Today the basic plan with Ads is fully operative and has more than 23 million active users. Link.
SaaS
High Net Revenue Retention is not necessarily a good thing.
In a recent chat of Jason Lemkin with Henry Shuck, CEO of public listed company ZoomInfo, Henry shared interesting insights about the SaaS macro-environment (watch) and acknowledged that high NRR (Net Revenue Retention) is not necessarily a good thing. I wrote a Linkedin post about it that generated engagement and interesting interactions, including from ZoomInfo CEO. Read the thread (link).
How to know if a SaaS business is overvalued or not.
Take the Enterprise Value to Yearly Revenue ratio (for example a company valued 1 billion € with 100 millions in revenue has a ratio of 10). This multiple shouldn’t be bigger than 1/3rd of your growth rate. So in this case you should grow at least by 30% yr on yr. Link.
Customer Success is the first to get eliminated in a layoff.
This is so wrong and short-sighted. In a difficult and competitive context the real work should start after the sale.
AI Agents as a Service
Presentation: AI, and everything else
Every year Benedict Evans, one of my favourite readings, produce a big presentation exploring macro and strategic trends. For 2024, ‘AI, and everything else’. If your startup isn’t working on generative AI, what’s wrong with you … Link.
OpenAI launches a store for custom AI-powered chatbots. Link.
Rising Stars
Bezos bets on Google challenger
Shopify CEO, Nvidia and Jeff Bezos amongst others invested in Perplexity. This one, more than ChatGPT, may become the real Google Challenger. Link.
Interesting reads 📖
Software report covering merger and acquisition (M&A) trends.
Transaction volume was down. Infrastructure software has the highest total value. Median enterprise value multiples for all segments combined in this report during the last 36 months were 4.3x revenue and 17.5x EBITDA. Link.
Podcasts and Webinars 🎬
Would you cut your feet to fit the shoe of what VCs want to hear?
As a tech founder, if you follow the trail that works for you and your customers, there are many ways to create a valuable software company. Cutting your feet to fit the shoe of what VCs want to hear is not necessarely the right thing to do. Listen to this interview to a founder of a Healthcare scaleup who is happy and doing well. Link.
Bundle or Unbundle?
When you start up your SaaS business the opportunity is to bundle your offering. When you scale up it's the opposite, you should consider the opposite. Zuora CEO Tien Tzuo has been the first evangeliser of the #Subscription Economy and spoke recently about the latest developments including his own experience with customers like Linkedin. Link.
I wish you a resilient and serene 2024 and the same for your families and friends. My thoughts go primarily to good fathers, separated with children and this is why. Link.