Hey SaaStr Community,

So when I was a founder, I didn’t pay much attention to how VC funds themselves worked. I just pitched them.

But fast forward to today, and there is an incredible amount of information about how the industry actually works, and we put a bunch of the best stuff on SaaStr itself.

Most important today is for founders to know (1) how active the venture markets are, at each stage and (2) how healthy venture is overall.

This you should know as a startup CEO or founder or executive. And importantly, I find most founders are still too optimistic here.  They still think it’s all easier right now than it really is.  So you have to see the data, and speak with it.

In terms of each stage, everything is now down. Most dramatic is later-stage investing, with the latest Crunchbase data showing Series D rounds are now down 92% (!) from the peak and 86% from a year ago.

Fundraising By VC Firms Themselves Is At a 10 Year Low. What That Means.

So we’ve covered HubSpot on our 5 Interesting Learning series more than any other SaaS leader, but it’s for a reason.  First, so many of us HubSpot itself every day, so it’s … well, tangible.  And second, it’s similar to the apps many of us build, sell, and market ourselves. 

We all at least sort of know HubSpot. 

If they are doing well, then hey, that’s a challenge to all of us.  And if they are seeing headwinds, then many of us will, too. They’re a barometer of sub-enterprise B2B SaaS in many ways.

And what’s the latest?

Well, HubSpot has now passed a stunning $2 Billion in ARR, growing 30% in constant currency.

And while that growth level is a bit off the crazy pace of 2021, it’s still mighty impressive in the current macro environment. And a good natured-challenge to all of us to keep growing!

This edition of the SaaStr Weekly is sponsored in part by Secureframe

Secureframe makes it easy to get SOC 2 compliant. With guided workflows and one-click integrations, the entire process is automated.

So SaaS Capital put out its latest report on SaaS retention and NRR after having surveyed over 1,500 SaaS companies and professionals.

There are a lot of great learnings and metrics in the report, and a few stood out to me:

#1.  Annual Contracts Didn’t Boost NRR, And Even Multi-Year Contracts Only Had a Modest Impact on NRR.  We tend to intuitively think annual contracts help combat churn, but they really don’t — they just defer it.

  And as time goes on, that doesn’t really help you much.  This data confirms that.  Let customers buy the way they want to buy.

#2.  Median NRR is 102% across all SaaS companies, Media Gross Retention is 91%.  Not a profound learning, but a great confirmation.

Ray Wang of Constellation Research and Vala Afshar, Chief Digital Officer, had me back after a long time on DisrupTV.

It was a really great deep-dive on where venture is right now:

• Multiples have fallen back to 2015 and 2016
• Why VCs can’t justify investing at $100m+ valuations in many cases today
• How optimism is bleeding out of VC, and realism has seeped in
• Why the “next round” often isn’t coming anymore, and how everything got inverted in 2021
• How you actually get cash-flow positive in SaaS

And following me in the above video was a great interview with the CEO of DevRev and founder and CEO of Nutanix, Dheeraj Pandey.  Stay for that one, too!  I loved his discussion in particular on how they spend $1 Billion total on sales & marketing at Nutanix, and how they could have easily done it just as well spending 25% less.

This edition of the SaaStr Weekly is sponsored in part by Hubilo

So what makes B2B content stand out and make people slow their scroll? Raj Sarkar, startup advisor at Sequoia Capital and a long-time CMO, shares tried & true steps on how to create viral and growth-producing content.

Sign up and learn how to create B2B content that drives growth for your business.

So founders, in many cases, were taught some of the wrong lessons in the Boom of late ’20 to early ’22. 

They were taught you could fundraise in a week. 

That you could sort of hide things.  And that you didn’t even need to have board meetings or really do much for your investors.

Now that’s biting founders when their investors aren’t as supportive as they would otherwise be.  And that just doesn’t help you.

So I updated a classic post on the 9 Types of CEOs that VCs don’t want to work with, along with a new video above. The 9 types. In rough order.

One of the most essential things SaaS founders need to get right is their sales strategy. From day one, it’s critical to drive results to impress your investors, acquire customers, and set your sales team up for success.

Dave Kellogg –EIR at Balderton Capital, and author of the Kellblog –– knows a thing or two about successful sales.

In an in-depth workshop, Kellogg shares seven things that every founder should know about results-driven selling.

Cledara is looking for a 360 Account Executive whose core task will involve managing the whole sales cycle from booking in demos, then taking the demos through to closing them to become Cledara customers.

Justworks is seeking an Account Executive who will be responsible for the full sales cycle - building and managing a sales pipeline, market research, prospecting, fostering relationships and creating new ones, contract negotiation, and closing on deals.

• SaaStr 659: The 9 Types Of CEOs VCs Struggle To Work With — With Founder and CEO of SaaStr, Jason Lemkin
• SaaStr 658: SaaStr CRO Confidential: Omni Founder Colin Zima on the Power of Leveraging Your Network for Sales and Recruiting

• SaaStr 657: Gainsight CEO Nick Mehta Shares His Top 10 Mistakes in 10 Years of Running Gainsight: Part 2

Listen on Apple Podcast, Google Podcasts or Spotify

I'd say 95% of founders still don't fully understand how tough the

Series A/B/C markets are right now

They think they understand

But they are still too bullish

Until you are clearly #1,

Your homepage should plainly list the 3 things you do better than the competition

If you are hoping for a magic "exit" this year,

Pitchbook data says Don't Hope Too Hard

Exits are back to pre-2013 levels

That's low

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