The Latest from SaaStr: Going Big in Venture Capital

THE LATEST FROM SAASTR

By Jason Lemkin  · Friday, November 11, 2022 | Fundraising, Product

10 (!) years ago in the first few months of SaaStr.com, in November 2012, folks all over Twitter were making fun of Sequoia for investing $20m+ in an iOS app that never launched and failed.

But they missed the point of how the game was played. 

The same week, Sequoia also sold Meraki to Cisco and made $240,000,000 on that deal. 

You can lose $20,000,000 if you make $240,000,000 the same week.

We see the same today with FTX.  A crazy loss.  But a tiny one, compared to the huge wins in the exact same VC fund.

Yes, FTX is going to zero.  And yes, it looks like fraud was involved.  It’s not OK.  But, in the end, Sequoia is already up $7.5 Billion in the same fund it lost $150m on in FTX.  Losses like this are part of Going Big.

LOCATIONS

By Jason Lemkin  · Friday, November 11, 2022 | Blog Posts

So there’s so much talk on the status of the SF Bay Area on Twitter and beyond.

There’s a few things that are clear:

The “Old” San Francisco in particular of 2015-2020 in SaaS is never coming back.  In fact it’s becoming a distant memory.  Something for the history books. 

Never again will SaaS companies have floor after floor full of AEs and SDRs in downtown San Francisco. That’s gone. Those folks are all either 100% distributed, or in hybrid situations outside the SF Bay Area.  See, also, most engineering teams.

NEW PODCAST + VIDEO

By Amelia Ibarra  · Friday, November 11, 2022 | Fundraising, Metric

At the end of Day 3 of SaaStr Annual 2022, Jason opened up the mic for an AMA. This episode is the first half of the session.

In this episode, Jason discusses:

• Breaking rules
• Setting goals
• Technical debt
• Black Swan events
• Y Combinator

VENTURE

By Jason Lemkin  · Friday, November 11, 2022 | Early, Fundraising

A few that come to mind:

The initial decision is made within 20 minutes of the first meeting, or at least, the first face-to-face. Make it exciting, speak with data, and get to the point. The initial Yes, Maybe, or No decision is made within 20 minutes. So save slides 20–200 for questions and back-up.

If your existing investors have a strong brand and aren’t positive on you, it can much harder to raise. At a minimum, keep them in the loop. Don’t just ignore them after they write a check. The converse is also true. Your existing investors are often your best source of leads for the next round of funding.

GROWTH

By Jason Lemkin  · Thursday, November 10, 2022 | Growth

So our economy is going through some unpredictable transitions, with Cloud and SaaS companies powering through with still-strong growth and unemployment remaining at near record lows, while inflation, interest rates and more batter us at the same time.

And we’re seeing a lot of layoffs in tech, Meta and Stripe being the latest.

Perhaps the only direct and frank I’ve seen is from Stripe:  “We Just Plain Overhired”.

But even there, the issues are more nuanced. 

Q&A

By Jason Lemkin  · Thursday, November 10, 2022 | Early, Fundraising

Let me give my process at least:

First, I try somehow to identify before a first meeting if there is a >=2.5% chance of investing.

This is perhaps the most non-obvious part. There are too many startups out there that want to meet, have coffee, do a Zoom, etc. You simply cannot meet with all of them.

The single most important thing you can do is protect your “slots” so that you meet with startups there is at least some chance you might invest in. You need to challenge your mindset so you don’t pattern match or get into a rut, but every meeting you take with a startup there is truly a 0% chance you’d invest in, is one less meeting you’ll take with one that could return the fund.

THE SECRETS TO SCALING

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SAASTR EVENTS

At SaaStr, our partners are an integral part of our events. In June 2023, we’re heading back to London for SaaStr Europa and we wanted to give a special shout-out to some of the companies that will be there with us!

We’ll see 2,500+ of the best SaaS founders, execs, and VCs June 6-7 at 2022 SaaStr Europa!  Grab tickets here. 

Join these incredible companies to experience all the value of SaaStr!

Tip the payment scales in your favor by being one of the first to unlock exclusive early access to BlueSnap's 2023 Payment Predictions eBook.

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