Last Year Was a Pretty Rough Year for Many SaaS Startups

So 2023 was a weird year. 

2021 was nuts, with crazy growth and crazy multiples. In 2022, revenue growth held up for many leaders, but share prices and multiples cratered. And 2023?

It was mixed actually, even if startups didn’t seem to get a breather, it wasn’t so bad for most public SaaS leaders.

On the debit side:

• Growth at public SaaS companies fell to all-time lows, averaging just 16%
• Public ARR multiples remained low, at 6x, for the second straight year
• Late stage VC fell dramatically, outside of AI investments
• Start-ups failed, and/or saw much tougher times.  Many in impacted categories saw growth fall to 0%.

And yet … it wasn’t all bad, for the bigger guys:

• The median SaaS and Cloud stock was up 41% in 2023! per Jamin Ball’s great summary below
• The Top 10 in SaaS saw their stock price up 136% on average!
• And everyone got much, much more efficient.  Most SaaS leaders flipped to cash-flow positive, for many, for the first time.

In the latest episode of CRO Confidential, host Sam Blond, partner at Founders Fund and former CRO at Brex, sits down with Ashley Kelly, VP of Global Sales Development at Rippling.

For context – Ashley had previously helped Sam scale Brex’s outbound sales from $2M to over $300M in ARR as Senior Director of SDR. 

Together they discuss:

• Scaling outbound sales and SDRS (sales development representatives) from 0 to $100M and beyond
• How to hire the right outbound sales team
• The SDR interview checklist
• How to create an environment to set up outbound sales reps for success
• Which KPIs to measure and matter most in outbound SaaS sales
• Increasing the quality and closed-won revenue with your outbound sales team

Let’s dive in!

Is it the end of an era in SaaS customer success?

It seems like some of the biggest changes to the human side of SaaS are happening right now. What does the AI revolution and SaaS spending cuts mean for the future of Customer Success and support?

Join SaaStr CEO and Founder, Jason Lemkin, and SaaStr fan-favorite, Nick Mehta, CEO of Gainsight for a LIVE webinar where they'll share their insights and predications on what the future of customer success will hold in 2024 and beyond. 

Want to partner with SaaStr? Click here to Sponsor our events, podcasts, newsletters and more.

So Harry Stebbings and I got back together for the first 20VC of 2024!

• Will IPO windows open in 2024?
• Will Stripe and Databricks go public?
• Did Figma kill the M&A market in 2024?
• Will LPs allocate to new venture managers?
• Will many venture firms slowly die?

This is the ultimate show with on what the heck happens in 2024 with many predictions…

It’s pretty common that a co-founder doesn’t work out, unfortunately.  I’ve been a part of all versions of this. I’ve had a great co-founder that went the distance with me.  I’ve had one that quit less than a year into the journey.  And I’ve been part of a senior team (not a co-founder, but part of a team) where I was the top performer by far, but wasn’t a fit for them in the end.  I’ve also observed this as an investor many times.

We agonize over this, and debate it, but in the end, the answer is simple:

Treat them the way you’d like to be treated.

It’s over. If you truly have to fire (vs. demote in some fashion) your co-founder, the relationship is broken. If not forever, at least probably for quite some time.

So first, my advice is first, slow it down. Are you sure there isn’t a role she can succeed in? If so, try one last time. And get some outside help to work you through this discussion.  The majority of co-founder departures … IMHO at least … are a bummer.  It would be better if someone super talented, that truly knows how everyone works, stayed in some role.  Even if it has to be a different role.  At least try.

But if there’s no chance it can work, be nice about it. Be direct. Be grateful. Just imagine if the shoe was on the other foot.

A bitter, angry ex-founder can drag at least a small cloud over the company for months and even years. Lawsuits, drama, whispers, bad Glassdoors, and more. A co-founder exit done wrong is often just the start of a dragged-out process.

Try to make it as quick but also gentle and appreciative as possible. Probably, they helped you get where you are today. Even if the help tapered off, and wasn’t as much as you’d hoped, or needed.

“Doubling Down” is a new series where we hear from top B2B SaaS investors on their most recent activities and takes on the current market. We had a great one last week with Nina Achadijian, Partner at Index Ventures. Check that out here.

This week we’re focusing on Erica Brescia, Managing Director at Redpoint Ventures!

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