So two recent data analyses across both private and public SaaS companies interestingly showed basically the same thing:

for the best SaaS companies, on average, growth in Q1 was down about 33% or so from a year ago.

The time periods are different, but they also are sourcing the data at slightly different times.

ChartMogul’s data, which we covered in another recent post, shows data from 1000+ SaaS startups from $1m-$30m ARR in essentially real-time, as they are doing real-time revenue analytics.

What did they see?

Growth rates down about 33% from the peak 2 years ago, and maybe 20% from a year ago.

BusinessInsider had a great story a ways back on Datto’s $1b exit to Vista Private Equity. So much of it resonated with me, especially the story of the CEO’s 10-year journey, and turning down an earlier $100m offer to sell. 

A decent offer to buy your company is so rare. Founders think it is common.

M&A is not.

Most founders never get a decent offer to buy their company.  And those that do in SaaS, often only get one or two.  Assume you get few-to-no offers to buy your startup. Ever.

And it’s even tougher now. Take a look at the latest Pitchbook data.  Acquisitions are way, way down.

So saying no is so risky.

So this post isn’t meant to be a sub-tweet, or a sub-post — it’s just a general learning over the years.  So please, no one take this personally.  It’s not about you.

But I’m still going to make one simple suggestion when you go to hire your first set of VPs, your second, or even your third: Beware The Mediocre Recycled

What does that mean?  Well, there is a certain type of VP candidate that worked somewhere good once, twice, sometimes even three times.  And they seem to know the talk and walk the walk.  So they just … keep getting hired.  As a VP of Marketing, again and again.  A CMO role, again and again.  A VP of Sales role.  But they actually aren’t that good.  They didn’t really do it.  They just worked there.  And sometimes, even oftentimes, left the place worse than when they got there.

A few tells:

• No CEO-level reference.  Any great VP-level candidate should have at least 1 CEO willing to sing their praises.  Maybe not everywhere.  Maybe a role or two didn’t work out.  But someone to say they were great.
• Too many short job hops as a VP / Director.  We can debate if this is OK or not early in your career, but someone who never seems to make it a year as a VP … well … they probably won’t at your shop either.
• No one great wants to come with them.  This is especially rough in a VP of Sales candidate, but it goes for any leader.  And great leader should have 1-2 great folks that want to follow them.

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So these are interesting times. On the one hand, we are seeing more layoffs than ever in SaaS.  But on the other hand, the best folks are more critical than ever.

The best sales reps just close so, so much more in tougher times.

 The best engineers build features that let you really pull away from the competition that is struggling. And so on.

So now is not the time to rest on your laurels on retention. It may seem easier than at the Peak of 2021, but really it isn’t.  Your best always are striving for greatness, for more.

With that I wanted to update a classic SaaStr post on retaining your team. Something that’s gotten harder over my career, but that’s more important than ever..

There’s an endless amount written on the internet about hiring “Rockstars”.  Finding them, not settling, and all that.  That you need to spend 20%+ of time recruiting. 

That the #1 most important thing you can do is put together a great team. Which is absolutely true.

So we 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 despite tougher macro pressures, Cloud and SaaS spend continues to hit record levels.

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

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It’s not a myth, but I think the reasons for it are confusing.

Yes, Mark Zuckerberg, Bill Gates, Aaron Levie of Box, etc. dropped out of college, and Dylan Field of Figma and many others never went due to Thiel Fellowships. But as Marc Andreessen points out … they’d been “coding” at an elite level for years, since their teens.

By the time they got to college, they were ready. They had 6–7 years of experience and could ship consumer (Zuck) or commercial (Gates) software.

So … if we go back to Aileen Lee’s original Unicorn report … the average age of a founder at founding of start-ups worth $1b or more is 34.

And in SaaS, we found that the average age at IPO is 43.

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