Only 17 days until the start of SaaStr Annual 2023: September 6, 7 and 8. 

Don't Miss Out on the Biggest SaaS Event of the Year!

This year's Annual will bring together an impressive lineup of over 12,000 SaaS CEOs, founders, and investors, eager to share their insights and network with fellow industry leaders just like you.

If you're considering attending SaaStr, now's the time to act as this will be another SELL OUT SaaStr event. 

With so many amazing speakers, sessions, and networking opportunities, you'll have everything you need to take your business to the next level. Not to mention the chance to connect with some of the brightest minds in the industry and discover new partnership opportunities.

So, don't miss out on this incredible opportunity! Register now to join us at SaaStr Annual 2023 in the San Francisco Bay Area this September.

Hey SaaStr Community,

You probably can’t make it in a large, crowded market if you have “no new innovative product offering.”

But take a pause.

Crowded large markets are good. That means you can scale quickly — if, if, you hit it.

But, in a crowded market, you probably have to be 10x better than the current market leaders. Not 10x better than the past. How do you do that? The market already has great products.

So, redefine the 10x:

Can you be 10x better just for one vertical or segment? 

For sales? For finance? For procurement? For small businesses? For very large businesses? Can you be 10x more “secure” than the competition? E.g., you don’t have to be 10x better than Salesforce in every way to build a $100m ARR businesses. You just have to be 10x better at some small part of CRM.

Can you be 10x better for where the market is going, not where it is today? 

Can you be 10x better on tablets? 10x better on phablets? 10x better on Bitcoin? 10x better outside the U.S.?

Can you put together 10x better of a team? 

This is very hard, but if you can do it — it does work. An epic team can outsell, outclose, and ultimately, outinnovate the competition.

So I don’t have a strong emotional attachment to the geo debates: 

Is SF Back? 

I say, sort of — at least for founders, VCs and execs.  

Is Miami a tech hub? 

I want to believe, and yet …

for SaaS …  Austin?

Maybe.  

Utah?  

Utah is clearly a SaaS powerhouse, but not necessarily a place a lot of founders move to to get a SaaS company off the ground.

Look, I love it all, all these tech centers. I just want to know.

What’s the headquarters of SaaS today?

Cyberspace? Zoom? Hayes Valley?

As part of the latest Cloud 100, Bessemer collected data on the top 400 SaaS and Cloud companies surveyed, and found:

52% are based in California, mainly the SF Bay Area

16% are headquartered in New York

and 4%-5% in each of Florida, Texas and Massachusetts

This edition of the SaaStr Weekly is sponsored in part by New Zealand Trade & Enterprise 

We think globally from day one and understand how to partner internationally, scale at speed, and deliver localized solutions to meet the needs of markets worldwide. There’s a reason why our companies are trusted by some of the biggest brands in the world.

So Toast is the latest SaaS leader to get much more efficient in the past 12-18 months.  Monday, HubSpot, Mongo and more all did the same.

But they’re still cruising — growing a stunning 45% as they blow past $1.1 Billion in ARR! Even with a company that is much more efficient than an IPO.  And their stock is up 34% Year-to-Date, and it trades at a health $12.6 Billion — or 12x ARR.

As time goes on with your startup, then your scale-up, then maybe even your public company … you will have to deal with disputes.

At first, they will be rare.

Then more common.

Then they will escalate, and in many cases, you’ll be pretty sure you are on the right side of a series of disputes,

• A customer that doesn’t want to pay a signed deal
• A VC that backs out of a term sheet
• An employee that was never even really there that sues you, or threatens to
• A sales rep that sues for commissions on deals they never even closed
• A partner that threatens you for not paying rev share on deals they had nothing to do with
• An ex-founder that comes out the woodwork and wants 10% of the company
• An advisor who claims they are owned a pile of options
• Your first patent threats
• Your first IP litigation

It will all happen to you, or at least most of it over time. And it just scales. It starts with thousands at stake, then tens of thousands, and later millions.

This edition of the SaaStr Weekly is sponsored in part by Booking.com

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My general advice here has stayed the same for 15+ years — but my specific learnings have evolved.

Advice: Just let your VP of Sales pick their CRM.  Let Your Top Execs Pick Their Tools.

Until a few years back, they’d probably want Salesforce 95% of the time. You might not. But whatever tool they want, I think you have to let your VPs pick their tools. The ones they know and trust. Otherwise, the amount of pain and new learnings aren’t worth it.

But: far, far more startups are using HubSpot for CRM than just a few years ago. It’s dramatic. Almost half of SaaStr Annual attendees use HubSpot, not Salesforce, for CRM now. A related recent survey we did here, with similar results.

So while the media is full of stories of unicorns doing layoffs and massive cutbacks, the story is a bit different with leading public SaaS companies.  Yes many public SaaS companies have done some sort of layoffs the past 12 months, they were often more really reorgs, though, without any net decrease in headcount.  And yes, many have gotten tougher on spending for sure.  But almost every public SaaS leader has still grown at either pretty good or very good rates the past 12+ months.

What’s changed the most: the leaders in SaaS have gotten radically more efficient.  In many cases, for the first time ever.

Let’s take a look at some examples:

#1.  Toast:  From -5% EBITA to +6% in Just 12 Months.  While Still Growing 43% at $1.1 Billion in ARR!

We came right back on 20VC to do a deep dive on where seed investing is right now with Frank Rotman, one of the most successful fintech investors, Sam Lessin on Slow Ventures, with an incredible portfolio, and Jason Lemkin.

• SaaStr 681: Scaling to $5B with Cockroach Labs' CEO Spencer Kimball's Formula for Sustained Growth and Resilience      

• SaaStr 680: The Most Important SaaS Metrics of 2023 with monday.com Co-Founders and SaaStr Founder Jason Lemkin              

• SaaStr 679: Scalable, Low CAC Growth Tactics with Hypergrowth Partners Co-Founder Guillaume Cabane

Listen on Apple Podcast, Google Podcasts or Spotify

% of their job they do:

A player: 150%-175%

B player: 80%-85%

C player: 10%

Part of being a successful founder is a commitment to excellence that many won’t understand or even see or perceive

To next-level excellence

This will create some friction among those without that commitment.

Actually, lots of friction.

Your best are underpaid,

The rest are overpaid.

You can't fully fix it,

But you can try.

Try >again< before we get too close to the end of the year.

© SaaStr 2023

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