David Skok

I've been recommended David Skok's blog [1] a few times which is exactly focused on SaaS. Haven't had the chance to go through it yet, so I can't personally recommend. [1] http://www.forentrepreneurs.com/

This seems more like a companion article to David Skok’s SaaS Metrics 2.0: https://www.forentrepreneurs.com/saas-metrics-2/ I found it to be more about SaaS metrics and less about product/market fit. For example, you could have great product/market fit with poor pricing, in which case you might have awful SaaS metrics and sluggish revenue growth while having great usage metrics and rapid organic/viral user growth. For example, imagine if PagerDuty or Slack were free for enterprises: they’d have terrible SaaS metrics but wonderful product/market fit, IMO.

re: "but anyone who is serious about building for the enterprise should definitely study other enterprise SaaS companies" Can recommend http://www.forentrepreneurs.com/saas-metrics-2/ as a good starting point.

David Skok wrote a great article about measuring customer engagement here: http://www.forentrepreneurs.com/customer-engagement/ HubSpot's CHI is a great metric too.

I also recommend the JBoss Business Case Study: "Lessons from Leaders: How JBoss did it" [1] [1] http://www.forentrepreneurs.com/lessons-from-leaders/jboss-example/

I consider David Skok's article on SaaS metrics[1] to be the best articulated and actionable source on this topic. It contains definitions of metrics, why they're important and even an Excel template that I've adapted to run my own SaaS business on. His article on the impact of churn on SaaS businesses[2] is also a must read even if you think you have a handle on it. Another great source is Christoph Janz's blog, in particular his KPI dashboard for early-stage SaaS startups[3]. [1] http://www.forentrepreneurs.com/saas-metrics-2/ [2] http://www.forentrepreneurs.com/why-churn-is-critical-in-saas/ [3] http://christophjanz.blogspot.co.uk/2013/04/a-kpi-dashboard-for-early-…

Fantastic resource: http://www.forentrepreneurs.com/saas-metrics-2/

Before you spend money on marketing I'd recommend spending some time improving your landing page and the sales funnel. The Copy Hackers ebooks are a good place to learn about this stuff: http://copyhackers.com/ I'd also recommend you read this article to learn about the kinds of metrics you should be measuring in your SaaS project: http://www.forentrepreneurs.com/saas-metrics-2/

David Skok of Matrix Partners has blogged comprehensively on this topic: http://www.forentrepreneurs.com/ The content may seem obvious, but how many startups can you think of that have utterly failed to achieve LTV > CPA?

>The sort of skills that would eventually allow me to run my own company/team/org. These are different things. Running your own company more often than not implies you have started the company, and the skills you need to start and run a company are different in and of themselves, let alone the fact they're different from running a team in an established company/organization where you never think about how the power is still on. In smaller companies and startups, the opportunity to learn is yours if you want it and the incentive to do so is survival. The company is small enough that you can, if you're so inclined, be involved in and learn about everything. I answered a few questions on some topics you might find relevant: https://news.ycombinator.com/item?id=40482961 There are a few replies there about communication and alignment. More (https://news.ycombinator.com/item?id=25398448 https://news.ycombinator.com/item?id=25288605) A FAANG is so large that the acronym is just five letters, and procuring whiteboard markers to them could be the biggest contract another company ever had. What you want is to expand the spectrum of your involvement or "ownership". One way of doing that is to learn to sell into the enterprise. Imagine you are a startup and you want to sell your product to [insert your company]. How would you go about it? It teaches you many things: What problem does it solve? For whom is it a problem? Why is it a problem? Why now? Are they aware it is a problem?…

Hi, dev here too working on my own side project, also an introvert, and English isn't my first language. You got a point, sales is a transferrable skill after all. But I think your sticking point is getting caught up in perfecting your pitch instead of actually getting infront of your target customers, trying to onboard them, letting it play out, and calibrating your product and onboarding process rightafter. My gut tells me it's a bit of anxiety in a way that it's blurry on how you should onboard your first few customers (which is a nerve-racking thing tbh as it varies on whatever type of biz you're looking into). Do you really need to take a 50% pay cut to figure it out? Maybe some reading could help, as a lot of founders have probably experienced this already.. - https://stripe.com/atlas/guides - https://www.ycombinator.com/library - https://www.kalzumeus.com/greatest-hits/ - https://www.forentrepreneurs.com/saas-metrics-2/

I'm seeing a lot of people in this thread balking at the $2B in losses. The thing is that aggregate profit is a terrible metric for measuring companies that have a recurring revenue model with high upfront costs (as WeWork, Uber, and many other tech startups do). The reason for this is profit doesn't factor in investments. Let's say I invest $1200 to acquire one customer who pays me $100/month. If you look at month 0, I have -$1200 in profit. At first glance, this looks really bad. Alternatively, you can see it as I am now making $100/month. Because of the $100/month, after one year I'll have made my original investment back and still be making $100/month. After two years, I'll have made a profit of $1200. This is probably exactly what's happening here with WeWork. If you look at things in aggregate, WeWork is spending a ton of money investing in opening new offices while they make a much smaller amount of money from their old offices. This makes them look like they are lighting money on fire. In reality they are investing their money in new offices and expect each office to make a return on investment over a few years. As long as they are spending more money investing in new offices than they are making from the old ones, they will appear unprofitable. For a typical software business, a pair of metrics that are much better than profit are CAC (cost of acquiring a customer) and LTV (the life time value of a customer). As long as a product's LTV is sufficiently greater…

Sales-savvy-co-founder of a bootstrapped company here. Stop. You don't need a sales person, you shouldn't be cold calling, or even selling over the phone. Why? It won't be profitable at your current pricing model ($132/year) unless you are pursuing large universities or university buying groups that can purchase 75+ licenses per year (~$10k ACV). If your ACV for each sale is over $10k (even $5k but that's getting down there) then it makes sense to have a direct sales team. If your ACV is under $10k, then you'll need to find more capital efficient ways of reaching customers. Not my area of expertise, David Skok has a great post about sales complexity that'll do a much better job than I can [0]. If you're ACV is above $10k I'd be happy to offer some tips on building a sales team behind that (I don't charge for consulting). We have a product that you're a little too early for but may be able to help when you're further down the road. My details are in my profile, feel free to reach out if you'd like some advice. [0] http://www.forentrepreneurs.com/sales-complexity/ Edit: Moving link to bottom.

"Once you get a lead, if it takes even a single phone call to close them, you’re no longer doing self-service and Customer Acquisition Costs vs. Self-Service pricing is going to kill you. If you’re not doing that phone call and you’re also not closing those deals, you need to figure out of if you can solve the problem through conversion optimization or if you really do need to be speaking with customers in order to close them. " Wow, can you bold this? Touchless sale/conversion = win. David Skok talks about it brilliantly and has an eagle eye on these metrics when evaluating his SaaS investments - http://www.forentrepreneurs.com/business-models/the-touchless-conversi… No one really talks about backing into pricing based on LTV/CAC ratio (affected by for example measurable inbound marketing or cpc/cpm costs). Pay back period (ideally CAC < a year) is also a factor. http://www.forentrepreneurs.com/saas-metrics/

Make sure whoever visits your website matches the kind of person you're making the jewelry for. So if you think your designs appeal to twentysomething girls: post the website link in places where those kind of people will be browsing. Have pictures of the kind of customer you want on your website. There are minimum 3 things you need to trigger a purchase - this is a good starting point: https://www.forentrepreneurs.com/buying-cycle-and-triggers/

You got me beat (Biltmore's a year short of 20 years, IIRC, oh yesteryear.) I tried searching for RH and banks and other than a landing page re: RBS and a few quotes it was particularly light on details. RH crushed it with the RHEL and JBoss model[1] (pretty much the paragon of "ethical open-source commercialization" IMO). Are these banks replacing pSeries AIX boxes at branches, WebSphere instances for the consumer to hit, or z13 mainframes with CICS or other more-than-five-nines-accessibility with guaranteed zero data loss? (Pardon my ignorance - not a snarky quip but rather genuinely curious as to what, if any, out of the box solutions RH is pushing in that sector.) [1] http://www.forentrepreneurs.com/jboss-example/

I've always found this guide[1] to be tremendously helpful to people looking for a good primer on SaaS business metrics. Important to remember here is that VC funding is not the path for everyone, and what a VC wants may not always fully align with what a business owner wants. If someone has a small SaaS product where the 3x multiple is lower, perhaps that is ok with them if it still allows them to run it as a lifestyle business. Ultimately these things are flexible (with the exception of CAC < CLTV). [1] http://www.forentrepreneurs.com/saas-metrics-2/

The main thing to consider is, as your customer acquistion scales, does your headcount/labor cost scale as well? If so, that should be a factor in your CAC calculation. I don't think there's one canonical formula. But here are David Skok's thoughts: "To compute the cost to acquire a customer, CAC, you would take your entire cost of sales and marketing over a given period, including salaries and other headcount related expenses, and divide it by the number of customers that you acquired in that period. (In pure web businesses where the headcount doesn’t need to grow as customer acquisition scales, it is also very useful to look customer acquisition costs without the headcount costs.)" [0] http://www.forentrepreneurs.com/startup-killer/

There is shopable Instagram. http://digiday.com/brands/four-retailers-tackling-shoppable-instagram/ You also have to ask where does the buying cycle and Instagram intersect: http://www.forentrepreneurs.com/buying-cycle-and-triggers/ The reality is that the ecosystem just isn't there to fully support cost per acquisition based transactions (the name for what your suggesting) in a way that satisfies provider (like Instagram), Brands (like Nike), Platforms (Like amazon, etsy), and Payment processors (this list is huge).

For understanding and calculating MRR, CAC, LTV, and cohort analysis, "SaaS Metrics 2.0" by David Skok (of Matrix Partners) [0] is highly referenced. Skok discusses viability of SaaS businesses (such as that LTV should be at least 3x CAC). A list of definitions is provided [1]. [0] http://www.forentrepreneurs.com/saas-metrics-2/ [1] http://www.forentrepreneurs.com/saas-metrics-2-definitions/

I believe he means annual contract value. http://saasaddict.walkme.com/getting-your-saas-acv-annual-contract-val… http://www.forentrepreneurs.com/saas-metrics-2-definitions/

80% seems to be the common 'educated guess' number: http://www.quora.com/What-should-be-the-typical-gross-margin-for-a-Saa… http://www.forentrepreneurs.com/saas-metrics-2-definitions/ http://www.forbes.com/sites/jjcolao/2012/10/02/running-a-saas-business…

http://www.forentrepreneurs.com/saas-metrics-2/ is a good one for SaaS startups.

> Warning! The entire article is filled with arcane finance newspeak and obscure acronyms! Boris Wertz is a SaaS/e-commerce investor. LTV, CAC, ARPU, churn, etc are pretty standard metrics for those types of businesses. Here is a good guide to SaaS Metrics: http://www.forentrepreneurs.com/saas-metrics/ Here is Bessemer's SaaS Reporting Template: http://www.bvp.com/system/files/reporting_saas.xls?download=1 The Smart Bear blog has a good series of SaaS metrics articles: http://blog.asmartbear.com/?s=saas+metrics

I want to add that we religiously use a format outlined here (also mentioned in the Constant Contact video): http://www.forentrepreneurs.com/saas-metrics/

I just recently rebuilt our KPI dashboard for Blossom.io and read through the following spreadsheets/posts/pdfs … * Christoph Janz – http://christophjanz.blogspot.de/search/label/financial%20plan * David Skok – as mentioned in the article (http://www.forentrepreneurs.com/saas-metrics/) * Ryan Carson – http://bit.ly/9w8eJ5 (talk: http://video.seedcamp.com/video/867124/seedcamp-week-2010-metrics-for) * Bessemer Venture Partners – http://www.bvp.com/cloud Had a ton of a-ha moments and learned a lot. Highly recommended.

For SaaS startups I found this post by David Skok to be very informative and comprehensive http://www.forentrepreneurs.com/saas-metrics/ . It is a bit old now but is still very relevant. Author talks about David Skok in the article too. Edit: Added ref to David Skok

I tweeted, tried to sign in with twitter which didn't work, then eventually created a standard account via email/pass to get into the content. The majority of the content is either a direct copy as cited or in reference to a post on a different site [1]. Not really ground breaking information, other than an Excel worksheet with mildly helpful formulas relevant to the topic. [1] http://www.forentrepreneurs.com/saas-metrics/

Every single blog post under the SaaS tag on this site - http://www.forentrepreneurs.com/saas/

This is called the viral coefficient, and if it's more than 1, it's 'viral growth'. http://www.forentrepreneurs.com/lessons-learnt-viral-marketing/