Hey everyone -

The countdown to SaaStr Annual is ON! 

51 days and counting until the biggest SaaS event of the year.

Be there September 6-7-8 as we take over the Bay Area for 3 days of tactical content, hands-on workshops, mentorship sessions, speed networking, recruiting and epic evening events.

With 12,500+ of the best SaaS leaders, executives, revenue leaders and investors joining us this year, this will certainly be the biggest and best SaaStr Annual yet.

So are we coming off the “lows” in SaaS and Cloud?  Are times now at least a smidge easier and better than the tougher times of 2H’22 and 1H’23?

Maybe. Some data does say Yes.

First, the public markets seem to think so, that things are better now than at the start of the year. 

The Top SaaS and Cloud stocks have quietly been on a mini-tear since the start of the year, up a stunning 30%.

Second, you seem to think so. In our recent SaaStr survey, 69% of you thought demand was picking up — at least a smidge.  At least a little ..

A few objections reps think they can overcome … that they can’t:

We literally do not need this product now. There’s the classic rule that only about 10% of prospects are truly in-market at any given time, and that’s about right in my experience.  Too many reps do too many lame cadences and break things.  Sometimes, checking back in next quarter or later really is the best way to go.

I’m already stuck in another long-term contract. This can be overcome with a buy-out deal, but many don’t do them. They should.  

I don’t have time right now. Too many reps try to force it, when really, the prospect may have more time next month or quarter.  It’s not just about the deal to the customer.  It’s about all the time and soft costs and training it will take to deploy your app, too.

It’s not a priority anymore. The reality is most enterprises can only bring in a few new critical vendors a year per department or org. Priorities do change.

I need to start with a pilot. Oftentimes they just do. Trying to “overcome” this can lead to a lost deal.

You’re not secure enough. A lot of customers really do need SOC-2, HIPAA and other compliances. Just do them.

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Here’s one way to think about it:

Give them shares worth 1.5x-2x the amount of cash their time is worth … vesting over the time they deliver the help.

Why 1.5x?

Well, any valuation for a start-up is a bit artificial in the early days. And the shares are also illiquid, maybe for a very very long time. So 1.5x seems fair in the early days.

So let’s do some rough math:

• Assume you ask a well-established CRO to be “Chief Sales Advisor”
• She makes $500k OTE today. That’s $250 an hour or so.
• You want her to help 4 hours a month, for 24 months.
• 24 x 4 x 250 = $24,000 in equity.
• Now multiply by 1.5-2x, and convert to shares.

Really, do all the “security stuff”, but especially just do the SOC-2.  Just embrace it early.

Why? 

First, you’ll have to do it to close even slightly larger buyers.

Second, you’ll be scrambling later to do it once you are forced to by a bigger customers.

This latest data from G2 was helpful:

• 86% of buyers require a security assessment prior to purchase, BUT
• only 24% involve a security stakeholder during research

So doing that SOC-2 and more early can let you check the box and avoid having a “security stakeholder” involved.

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I would have the board approve CEO salary, all material expenses (>$5k-$10k), and an overall CEO expense policy. 

And in fact, once you have VC investors, this is often required in your Investor Rights Agreements or other financing documents.  And approving the CEO’s salary is often required under state laws.

In a startup, the reality is a CEO can probably do almost anything they want — up to a point.

It’s hard for the investors to really police most activity or even be aware of a lot of it.  But just because you can break a few rules, doesn’t mean you should, or that it won’t catch up with you later.

Transparency builds trust.

Get everything approved by the Board.

We’re almost there!!  2023 SaaStr Annual is coming up on Sep 6-8 in the SF Bay Area, once again on our 40+ acre compass at the San Mateo County Fairgrounds.

We’ll have over 100 of the leaders in SaaS as sponsors, from Salesforce to Expensify, from Google Cloud to G2, and so much more!

Need leads?  Want pipeline influence? Want to get your brand out in front of 12,000+ of the best of the best in SaaS?

If you want to join us, let us know here ASAP!

Up Next: Wednesday, July 19th @ 10AM

Topic: Strategic Finance in Today's Market: A Tactical Guide to Building & Scaling Your Team with IVP

Speaker: Michael Miao, Partner @ IVP

Workshop Wednesdays is new series where we’ll be bringing some of the best SaaStr speakers to you LIVE, every Wednesday. 

Each workshop will be hosted in a live, interactive 30-minute format at 10am Pacific each and every Wednesday. This workshop will be 100% LIVE, not pre-recorded, and will be hosted in an, interactive 30-minute format, including Q&A.

© SaaStr 2023

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