I can be slow sometimes, but it’s taken me a while to understand what’s >different< in SaaS in 2023.

Budgets are tighter, but SaaS is still growing, folks are still buying more software than ever.

Here’s what’s different: 2023 is the first time SaaS itself got harder since 2005.

SaaS has never been truly easy outside of a window from mid-2020 to late 2021 But every year, it got easier and easier. Not easy, but easier and easier.

There was a bump in 2016, a Flash Crash in SaaS, when budgets were slashed, but it didn’t last long enough to really impact renewal cycles.  SaaS markets had fully recovered later that year.

Even the 2008-2009 downturn, while truly brutal, didn’t hit SaaS as hard as the rest of the economy. The best of us kept growing, albeit with elevated churn through 2010.

Everyone usually gets pretty good at segmenting customers by ACV.  Large, Medium and Small.  Or at least by splitting up sales-driven and self-service revenue.  Or enterprise vs smaller customer. 

And later, we often start segmenting by vertical and industry.

More of you right now should be putting that aside a bit and segmenting your customers into 3 new groups:  Growing. Struggling.  And Shrinking.

And setting different goals for sales and retention for each segment:

Growing.  Almost all of you have at least one segment of customers growing now.  Maybe it’s healthcare.  Or remote workers.  Or call center.  Or esports.  Or e-commerce.  Maybe it’s just 10% of your customer base, but there’s often at least a small piece that is growing faster, at least for now, than before these crazy times.

Struggling.  Some of your customers may, on balance, be struggling but making do.  E.g., generic SaaS companies.   Many are doing OK but a lot of impacts today.  Generally, anyone at 0.1% growth or higher counts here.

Shrinking (and Dire Straits).  This category can just include clients already shrinking in size.  E.g., certain categories of startups.

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As we gear up for SaaStr Europa 2023 in London on 6-7 June and SaaStr Annual 2023 in the SF Bay Area on 6-7 September, we wanted to take a look back at some of our most iconic speakers and sessions from over the year, that we can still learn from today.

At SaaStr Annual 2020, for the first time, we were able to get Ben Chestnut CEO of Mailchimp to join us for a very open and honest discussion of the top challenges really building the #1 100% bootstrapped SaaS of all time.  At least so far.

Fast forward one year, and 100% bootstrapped Mailchimp was acquired by Intuit for a stunning $12 Billion. It seemed a good time to revisit my Top 10 Learnings from my chat with Ben, with a few updates.

Should you join that Successful SaaS start-up?

The one that just raised a nice seed round, that has $20k in MRR, and a cool product?

Maybe.

The key is understanding if it’s merely a pre-success you are meeting with … or one that potentially can be very successful.  And it turns out, at least in my experience, the characteristics of Successful and Very Successful SaaS companies are actually quite different.

But especially in the early days, it can be hard to tell, especially from the outside.

Don’t worry about stage fright. It’s real.  I used to have it.  And … you’ll get over it.

I remember the very first time I had to present to a Fancy Board Meeting. I wasn’t a founder yet, but I was told I had to get up in front of a half dozen very famous, very prominent Venture Capitalists.

10 minutes in, I frozen. And walked out.

It was terrible.

Fast forward to the first time I had to get on stage in front of 2,000+ in a Vegas kick off. I’d done it so many times, I refused to even show up to the prep session.

You’ll get better with practice. It’s OK.

The secret is repetition. You’ll start to get very good at your pitch, the vision, the value proposition, once you’ve done it a few times.

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So I wanted to do a little weekly look at who in SaaS and Cloud is doing well.  These are tougher times for almost everyone than the Go Go Days of 2021. Budgets are being scrutinized, and even the best are growing more slowly in many cases.

But many are still doing well — as Cloud and SaaS spend continues to hit record levels.

So a quick look at who’s doing well this week.

My 7 top tips to increase sales quickly.

1. Hire a great VP of Sales. Yes, I am a broken record here. But I’ve seen it 100+ times. Hire a great VP of Sales, and even if nothing else changes … she’ll increase the revenue per lead by 20–100%+. In one sales cycle or less.
2. Raise prices 20% — but ideally only on new customers. Pricing is not a science, even in B2C companies. Not really. Raise prices 20%. You can always also discount 20%-25% the next day. Discounting back to your old list price even is far better than discounting fromyour old list price.  But be careful not to raise prices on existing customers without really thinking that through.
3.  Make sure you have monthly quotas, not quarterly ones. Quarterly ones take all the pressure off for the first 2 months of the quarter. Later, when you are huge, move to quarterly quotas. Not today.

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