So there was a quiet SaaS IPO you may have missed in the craziness of 2021 — SEMRush, a tool your marketing department quite likely uses to keep track of the performance of your SEO and marketing site.

Today, Semrush is quietly doing $290,000,000 in ARR, with strong NRR, and growing a very respectful 24% a year … and is worth just $1.2 Billion.

It’s tough out there in the public markets, folks.

Semrush crossed 100,000+ Paying Customers, So About $2,800 ACV Per Customer.  But $10k+ customers growing fastest. The classic “high-end of self-service” price point.  But $10k+ customers are growing 45%, so that’s where the biggest growth is.

If there’s one rule almost everyone universally agrees with when building software, it’s that focus is critical. Conventional wisdom says that if you narrow your focus, you can go really deep. 

Parker Conrad, the CEO of Rippling, disagrees.

As a founder of two different compound startups, each valued at above a billion dollars, he’s probably the best person in the world to share this alternative perspective. 

This edition of the SaaStr Daily is sponsored in part by Notion

Notion combines project management with your docs and knowledge base, so you can stop jumping between tools, and stop paying too much for them too.

A few signs you finally have a “real company” in SaaS:

• Your customer count is doubling monthly, even from a small base
• You are getting word-of-mouth customers from existing customers
• You are growing > 100% at $500k+ in ARR
• Enterprise prospects and potential customers are finding you
• You have more leads than you can call back

Those are all good signs.

In the end, if you hit $1m ARR and are growing < 100% annually in this day-and-age, you don’t quite have product-market fit.

But the flip side is the Cloud is just too big, and growing too quickly, to not grow 100% by $1m or so ARR >if< you really have something of true and differentiated value in your market.

Don’t Fail.

I’ve almost failed several times but never actually failed. Why not?

Never quit. You can’t fail if you don’t quit.

Find great co-founders. If you find truly great cofounders, you always have another card to play.

Don’t spend all the money. I know this sounds simple and silly, but whatever amount of capital you do have — make it last. Whatever it takes.

Go get more customers. Revenue cures all ills. Get on airplanes. Learn outbound. Hustle. Go to the top events. Whatever it takes.

Stop feeling sorry for yourself. A tiny bit of this is OK. But then dust yourself off and figure it out!

This edition of the SaaStr Daily is sponsored in part by Instruqt

Free trials and freemiums can be a powerful sales strategy. But it’s not a one-size fits all! Learn how to increase conversion by leveraging other PLG modules, such as sandbox product experiences, and show prospects how your product can solve their challenges. 

One of the most critical relationships an entrepreneur or founder will have in the life of their company is with their investor. A healthy VC-founder relationship can make the difference between company success and failure. So how do you ensure that your investor relationship is a strong one?

In a recent Workshop Wednesday session, Recursive Ventures Founder Itamar Novick shares his secrets to creating a solid bond based on his years of experience in VC and founder and leadership roles.

As the founder, you may be happy with a longer road to reaching certain milestones, but your investors have their fund lifecycles to consider. They may think of liquidity on a different timeline than a founder would. Being prepared for this scenario in your company’s future is important. 

So we use SaaStr itself as a lab for a lot of learnings, including just what folks want from field marketing and events. 

The theme for 2023 is clear:  leads and pipeline.  Brand marketing, meeting with customers, and pipeline influence have fallen down the list.

So we modified things to focus on qualified leads.

The result? The average sponsor got 153.5% of the qualified leads of the prior year.

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