Hey SaaStr Community,

So most of you can probably infer from funding posts and press releases just how much B2B funding is going into GenAI startups.

But exactly how much?

Sapphire Ventures has the latest data.

In 2023: GenAI funding was up a stunning +271% (!) But overall, B2B VC funding was down -36%

2024 seems to be pretty much the same. Top SaaS VCs are investing 80%+ in AI-first startups. This is where the VC frenzy is right now.  With public SaaS multiples frozen around 6x, there just isn’t a ton of later-stage excitement outside of AI.

So we’ve had a ton of great conversations over the years on SaaStr on when and how to go multi-product. And you can see some great deep dives here from some of the top leaders in SaaS:

• How, When and Why to Launch a Second Product: A Deep Dive with Dharmesh Shah, CTO HubSpot
• The Secrets to Going Big, Going Multi-Product and Going Public with Amplitude CEO Spenser Skates
• From $5M to $100M: How to Scale a Multi-Product Startup with Lattice Founding CEO Jack Altman

I wanted though to do a deep dive on just one piece — a few thoughts how to sell that second product.  It’s hard enough to build a second product, with all the constraints on product and engineering.  Then how do you actually get anybody to buy it? :). Too many sort of think it will sell itself with the same team, motions, etc. It so rarely does.

A few thoughts, really a 3-part test.

So both of SaaStr’s mega events are coming up.  First up, the 5th SaaStr Europa is finally coming back to London on 4-5 June.  4,000+ of us will get together there to share, scale and learn.

Next up is the 10th SaaStr Annual in the SF Bay Area, Sep 10-12, once again in sunny San Mateo in the SF Bay Area on our 40-acre campus right between Palo Alto and San Francisco.  12,000 of us will gather there this year.  11 stages, 1000 mentoring sessions and braindates, 800+ VCs.

Which should you join, if you are picking one?

So Atlassian has cruised past $4 Billion in ARR, still growing a steady 21% in a very efficient fashion. It’s raining cash, with 27% free-cash flow margins.

The markets like this combination. Even with a few bumps, Atlassian is still trading at a $55 Billion market cap, so over 12x ARR.  That’s twice the average of 6x ARR for public SaaS companies.

Efficient, steady, profitable growth at scale. The markets say Yes to Atlassian.

So times aren’t tougher for everyone in B2B and SaaS, but they’re tougher for many.

And the playbook has mostly been as follows for those with tougher times:

• Cut the burn
• Freeze hiring
• If growth is really slow, look at layoffs if necessary

and

• Cut marketing to almost zero

To some extent, this makes sense. Marketing is a variable cost with generally medium-term benefits in SaaS and B2B. Most marketing spend builds pipeline that you are lucky to close in 4-12 months. So cutting that spend may limit future growth, but it rarely impacts the current month.

So marketing gets cut.

This edition of the SaaStr weekly is sponsored in part by Paragon

In today’s world, there’s a clear shift in what founders, boards, and investors are all after — scalable, low-CAC (customer-acquisition cost) growth strategies. 

In a panel, Guillaume Cabane (G) and Martin Gontovnikas (Gonto), co-founders of HyperGrowth Partners, Axelle Heems, Senior Director of Growth Operations at Gorgias, and Morgane Palomares, VP of Marketing at Vercel, share real-life examples of how demand generation, growth, and marketing strategies have been executed to scale beyond 2x ARR each year, even on a low budget. 

In this latest episode of CRO Confidential, Sam Blond, Partner at Founders Fund and former CRO at Brex, sits down with the CRO of Zapier, Giancarlo Lionetti (GC), to chat about Product-Led Growth (PLG) and Go-To-Market (GTM). Everything from hiring on the GTM side to layering in a sales-led motion into PLG. 

Before joining Zapier, Giancarlo was at Atlassian as a technical sales lead before moving to DropBox as a Senior Director of Growth and Monetization, and was CMO at Confluent – so he has a wealth of knowledge from Zapier’s Go-To-Market history as well as these successful SaaS companies to pull from. While we use Zapier here at SaaStr and are super familiar with it, for those who don’t use the tool, it’s a workflow automation platform that connects your data sources and apps to help maximize the efficiency of your teams, tools, and processes without relying on a developer team. 

From a Go-To-Market perspective, Zapier uses a hybrid model that involves a combination of freemium offerings, subscription plans, and partnerships. Let’s dive into what’s making that hybrid model successful.

• SaaStr 722: 2024 State of SaaS: Trends and Predictions with SaaStr CEO and Founder, Jason Lemkin

• SaaStr 721: How Revenue Leaders at Box, Calendly, and Lattice Scaled From $0 to $100M+ and Beyond

• SaaStr 720: CRO Confidential: What It Really Takes to Be Successful in Enterprise SaaS Sales with Christian Smith, CRO of Splunk. Hosted by Sam Blond, Partner at Founders Fund

Listen on Apple Podcast, Spotify or Google Podcasts

% of their job they do: 

A player: 150%-175%

B player: 80%-85%

C player: 10%

Here's the thing we're all re-learning in 2024:

To be VC-backed, you truly have to grow at insane rates

At least, Triple Triple Double Double (3x 3x 2x 2x)

Ideally, Triple Triple Triple Double Double

If that's not you, don't raise. Or stop raising. Or at least, be realistic.

A great sales rep does most of the work for the prospect: 

Does the scheduling

Does the demos

Solves the problem

Helps sell other stakeholders

Follows up

Simplifies deployment

Yes, this is a lot more work than sending a Calendly link the next day, I do admit

© SaaStr 2024

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