Inc - Is the Seed VC Model Broken with 20VC

So Harry Stebbings was kind enough to have us back in the new group format on 20VC with 2 of the legends in seed investing, Eric Paley of Founder Collective and Mike Maples of Floodgate.

While both aren’t pure SaaS investors, they’re both in the top 1% (!), with investments in The Trade Desk, Okta, Airtable, Slack and much more!

Eric Paley is the Managing Partner at Founder Collective, one of the world’s most successful seed funds with investments in the likes of Uber, The Trade Desk, Coupang and Airtable.

Mike Maples is one of the OGs of seed investing. As the Co-Founder of Floodgate, he has backed the likes of Twitch, Okta, Lyft, Twitter and more.

Jason Lemkin is the Founder @ SaaStr one of the best-performing early-stage venture funds with a portfolio including Algolia, Pipedrive, Salesloft, TalkDesk, and RevenueCat to name a few.

Missed our biggest, best SaaStr Annual ever?  No problem!  We’ll start transcribing, publishing, Youtube-ing, and podcast-ing all the top sessions.  Some are already up, and you can watch at ton of them here on the Live tab on YouTube.

But if you want to catch up on the 7 Most Popular Sessions from 2023 Annual, here they are!

This edition of the SaaStr Weekly is sponsored in part by DevRev

Don’t settle for generic tools! Upgrade to DevRev OneCRM: Purpose-built for SaaS & tech. Modernize customer relationships with customer-centric software development and product-centric support. Streamline collaboration to focus on what matters most.

Discover Bessemer Venture Partners’s annual State of the Cloud report, going through trends, benchmarks, and metrics that underpin the Cloud economy. 

The past twelve months have been relatively turbulent for Cloud founders. SVB collapsed, market multiples are down, yet the IPO window is re-opening, and we have a platform shift to AI that’s exciting everybody. 

What does this mean for Cloud companies?

Let’s find out.

So I’ve been doing SaaS for a while, and the costs of doing business have just gone up. 

Inflation is everywhere.  Salaries have gone up. Marketing expenses have gone up.  And expectations for OTE have gone way up.

The net effect I see this happening today is a squeeze in U.S.-based SMB sales positions.

SaaS sales execs with even a little bit of experience at other SaaS companies are looking for higher and higher OTEs, often with lower effective attainment and high support costs.

Net, net the math isn’t really penciling out anymore.  U.S.-based sales reps often aren’t really willing to work, or excel, at sub-$100k OTEs anymore.

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

Upgrade your business travel with Booking.com for Business. Enjoy exclusive business rates and earn loyalty points on flights, accommodation and car rental, along with 24/7 travel support - all for free!

Many of the fundamental business models that were once engraved in the SaaS playbook are now changing thanks to a tougher macro environment and a maturing market. 

In last week’s Workshop Wednesday, held every Weds at 10 a.m. PST, Stephanie Opdam, Partner at Notion Capital, shares four business model changes that will allow SaaS companies to build resilience and staying power over time. 

Some of the changes we’ve seen in the last year or two include: 

1. CAC reduction
2. Headcount optimization
3. Price complexity
4. Quality of revenue

A different environment means a different strategy, and Notion Capital lays out four business model changes that could be helpful based on what peers are doing.

© SaaStr 2023

644 Emerson St. Suite 200, Palo Alto, CA 94301

If you'd like to stop receiving the SaaStr Daily, click here