What to Expect from SaaS in 2024 with David Sacks and Jason Lemkin

Founder and General Partner of Craft Ventures, David Sacks, shares his perspective on what to expect from SaaS in 2024. Is everything going to be focused on AI? Can you raise a Series A if you’re not “AI SaaS?”

These are some of the questions Sacks and SaaStr Founder Jason Lemkin discuss at this year’s SaaStr Annual.

Many will tell you it’s a bad idea, and it probably is — in most cases.  I sort of tried this myself, and it didn’t quite work.  We had all the classic problems of unclear authority, especially as times got tough.

But here’s the thing: the best startups are all outliers.

So you find that while they follow most rules, they also follow whatever path makes for the biggest success.

Two of the biggest successes in SaaS that have co-CEOs!

• Atlassian
• Monday

So when it works — it works.

A few other VC-type “rules” that were broken by outliers:

• Canva, Cisco: spouse / partner teams
• Zoom, Zscaler, New Relic: solo founders
• Atlassian, ZoomInfo, Qualtrics:  bootstrapped to billions and IPO

Rules are important, they are directionally correct and help us synthesize complex issues.  But outliers, are well … outliers.

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So Samara is that vertical fleet-and-more-management-and-more SaaS company that has just roared out of the gate since its quiet IPO.  Things did get harder for them about a year ago, but growth has since reaccelerated.  And efficient growth at that.

Fast forward to today, Samsara is at almost $1 Billion ARR growing a stunning 40% — and are now cash-flow positive.

New Bookings Growth Has Re-Accelerated, with Highest Growth in Six Quarters

You can see below Net New ARR has come back and his a new high last quarter, and well above the somewhat tougher times of 12-15 months ago.  That’s even with going profitable. 

Downturn?  Not for Samsara.

Practica put together its guide of the top SaaStr articles to excel at work.  Many are my favorites too, and some you may not have seen.  I think this is some pretty helpful reading here, a good slice of some of the most tactical insights.

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Let me share my list. It’s more about things I worry about after investing, as sometimes they’re hard to see before:

• Founders’ understanding of market doesn’t get deeper. I really worry when 9–12 months later, the founders do not understand their market better.  Especially, when they are a bit too arrogant about how they will kill the leaders — when they don’t really understand why they win.
• Too slow to hire VPs. Hiring is tough, but if 12 months have gone by and you haven’t added 2 strong senior execs to the team, I get worried. I worry if you can even recruit them at all. If you can’t — you will never scale.  At least, you will struggle to scale.  When others fly.
• Too slow in general.  Startups that are just too slow get eclipsed by the competition.  No matter what else great they have going for them.
• Excuses for misses.  Often, again and again. This is maybe the biggest flag. You will have rough months and quarters. Probably even a rough year or two. It’s a bummer, but it happens to us all. When the “excuses” come out, though … confidence goes out the door.  
• Surprises. There’s no need for surprises at the investor / board level in SaaS. Let everyone know ahead of time. In SaaS, the revenue recurs. You’ll know when a big customer is at risk. When the burn rate may grow larger than plan. When the year plan is at risk. When a VP may not be the right one. The best CEOs telegraph these risks, without drama, but plainly and ahead of time.

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