saas 101: metrics & best practices

SaaS 101: Metrics & Best Practices

March 13, 2015

Nicolas Wittenborn, Point Nine Capital

Nicolas Wittenborn

Associate at Point Nine Capital

Tweet @ncsh and blog at heyni.co

Founded 2011 in Berlin

Investing €100,000-1,000,000

Raised €45M

Team of 8

Who’s Point Nine

Vancouver

Washington D.C

Auckland

Edmonton

New York

San Francisco

BerlinRiga

Point Nine ’s SaaS

Paris

Barcelona

Warsaw

III.

Best Practices

II. Important SaaS Metric

s

I. What’s SaaS?

I. What’s SaaS?

aaSSoftware as a Service

No installationContinuos updates

Accessible from everywhere

Why VCs like SaaS companies

Recurring revenues

High margins

Global scale from day 1

The SaaS market is quite ‘frothy’

which might change soon**

* Data analysis by Tom Tunguz **Jason Lemkin: ’Unfortunately, SaaS Start-Up Valuations Are About To Fall by 50%’

?

*

Global SaaS Market SizeROW21%

France3%

Canada4%

Germany6%

UK6%

US60%

Global SaaS Market Volume*

shows strong US bias

* Siemer's SaaS Industry Report 2013

Founded in Copenhagen 2007

Move to US HQ in 2009

IPO ($ZEN) in 2014

Europe still produces great SaaS companies

II. Important SaaS Metric

s

Monthly Recurring Revenue(MRR)

negative churn

Extension MRR > MRR churn

Churn & Retention: Cohort Analysis

Yours truly: ‘Cohort Analysis Q&A’

LTV

CAC

III.

Best Practices

Incentivised referrals are a great ‘growth hack’*

* if you have a suitable (freemium) model

Get to WOW! fast*

* a great on-boarding can increase conversions significantly

???

You might be too cheap!

* if you provide real value & haven’t raised prices since you launched

???

Price increase

Valuable content = King

One time effort, long time effect

There is no silver bullet

Just the Long, Slow, SaaS Ramp of Death*

* Gail Goodman: How to negotiate the long, Slow, SaaS Ramp of Death

At least until now…

Hyper-growth?

Outlook: SaaS 2015

* Edited Social + Capital Chart

Thanks…

…and found all the SaaS Startups!

nicolas@pointninecap.com

Ressources•Blogs:

• David Skok http://www.forentrepreneurs.com/ • Tom Tunguz http://tomtunguz.com/ • Christoph Janz http://christophjanz.blogspot.de/ • Jason Lemkin http://saastr.com/

•Slides: • 9 Worst Practices in SaaS Metrics: http://www.slideshare.net/PointNineCap/9-worst-practices-insaas-metrics • Siemer SaaS Industry Report 2013: http://www.slideshare.net/SiemerAssoc/sa-saa-s-industry-report-summer-2013-25007137?ref=http://www.siemer.com/research/summer-2013-saas-industry-report/

•Secrets to raising VC (Mamoon Hamid): http://www.slideshare.net/03133938319/saastr •More:

• Quora SaaS topics: http://www.quora.com/Software-as-a-Service-SaaS • Long, slow, SaaS Ramp of Death: http://pawel.ch/post/71104054756/the-long-slow-saas-ramp-of-death-i-have-just • Cohort Analysis Q&A: http://heyni.co/post/79862265851/cohort-analysis-a-practical-q-a • ‘Unfortunately SaaS Startup Valuations about to fall by 50%’: http://saastr.com/2014/04/29/unfortunately-saas-start-up-valuations-are-about-to-fall-by-50/

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