So there’s a theme I’ve been working on with all the SMB-focused founders I work with and have invested in:

#1. Te Goal for SMB SaaS is 100%+ NRR.  Easy in enterprise, hard in true SMB.

#2. However, SMBs have a certain level of inherent churn.  That’s often 3% a month or so.  You can still make them super happy, but a subset of small businesses will churn at that rate anyway.

#3. Your job is either to go much more enterprise to get to 100% NRR — or to make your product into the OS for an SMB.  Into an ERP. Into the #1 most important app they use, and can never rip out.  And then — your NRR will cross 100% with SMBs.  And that will mean building a lot more product.

Brian Halligan, Chairman and co-founder of HubSpot did a deep dive recently on LinkedIn and how HubSpot got from 60% to 100% NRR. Brian talks about a lot of things that moved the needle in getting HubSpot to 100% NRR.

To get to 100%+ NRR with SMBs, you often have to do both.  Relentlessly attack the causes of churn.  But also at the same time, building more and more of the core functionality the SMB needs.  Enough so they’ll truly never leave.

Don't miss your chance to join 13,000+ SaaS founders, executives, and investors at the world's largest B2B SaaS conference. For a limited time, secure your spot at SaaStr Annual 2025 and enjoy Holiday savings.

So it was just 8 months ago we wrote “Is SaaS Dead?” and the post not only took off, it summarized a zeitgeist, a malaise, a feeling across much of B2B at the start of 2024. 

That SaaS was Dead. 

A combination of AI and buyer retrenchment had killed it.

What a difference 8 months makes.  

It’s not 2021 again, but so much has changed for the better as the year ends.

So few things are more disruptive than when a VP doesn’t work out.  Especially if they’ve hired a ton of folks under them that didn’t work out either. Millions are spent, so many mistakes must be undone, and so, so much time is lost.

So:

• When in doubt, don’t make the hire. Push on.
• If they don’t have anyone great to bring with them, don’t make the hire.  Push on.  Don’t just assume they have a few great folks ready to join.  Ask.  And go talk to them.
• If they don’t have one boss that says they were epic, don’t make the hire.  Push on.  It’s fine if one boss says they didn’t crush it.  But you need one you respect say they were an A.
• Especially if you are tired. That’s when we all sort of settle.

I was reminded of this from the great SaaStr Annual interview that Jyoti Bansal did with MongoDB’s CEO Dev Ittycheria. When I re-watched it the other day, this quote really stuck with me:

You are lucky if 60% of your VPs work out.

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

Customer requests for integrations won't slow down in 2025. Learn how you can sanely fulfill those requests.

Ironclad CEO and co-founder Jason Boehmig joined Seema Amble, Partner at Andreessen Horowitz at SaaStr Annual to share their observations on what’s currently working – and what’s not quite there yet – for Artificial Intelligence (AI) in SaaS.

With Ironclad’s journey from an AI-first concept in 2014 to a Series E+ company and a16z’s extensive portfolio view, their insights offer a valuable perspective on the current state of AI in SaaS.

We are gearing up 10,000+ at SaaStr Annual 2025 on May 13-15!! And more details on SaaStr Europa 2024 in the Fall of 2025 soon! Yup, we’re back earlier in the year for Annual where we used to be, so everything will move a bit faster this time.

And speaker submissions are now OPEN. We’ll do an announcement of the first wave of speakers soon, but it’s already an epic list. From the CEOs of Cloud Giants Snowflake and DropBox, to top vertical SaaS CEOs at unicorns Flock Safety, Clio and more, to the CCOs of Canva, GitHub, to 20+ top AI founders for our 2nd Annual AI Summit, and more, it will be epic.

So few things are more disruptive than when a VP doesn’t work out.  Especially if they’ve hired a ton of folks under them that didn’t work out either. Millions are spent, so many mistakes must be undone, and so, so much time is lost.

So:

• When in doubt, don’t make the hire. Push on.
• If they don’t have anyone great to bring with them, don’t make the hire. Push on. Don’t just assume they have a few great folks ready to join. Ask. And go talk to them.
• If they don’t have one boss that says they were epic, don’t make the hire. Push on. It’s fine if one boss says they didn’t crush it.  But you need one you respect say they were an A.

Especially if you are tired. That’s when we all sort of settle.

I was reminded of this from the great SaaStr Annual interview that Jyoti Bansal did with MongoDB’s CEO Dev Ittycheria. When I re-watched it the other day, this quote really stuck with me:

You are lucky if 60% of your VPs work out.

So one of the quiet SaaS leaders that has just crushed it in 2024 is Doximity:

• At $550m in ARR, it’s worth a cool $10.4 Billion (!) — or 20x ARR.
• And its stock it up a stunning +90% this year.

What’s going on? A combination of:

• Growth re-accelerating. Doximity is growing 20% now, vs. 18% at $450m ARR.
• Insane profitability.  53% EBITDA. That’s crazy.  It rains cash at Doximity.

To oversimplify’s Doximity’s business model, it’s “LinkedIn for Doctors” has almost every U.S. physician on its platform. And in turn, it can charge pharma and other companies $100k+ to reach them.

At the closing AMA of SaaStr Annual, SaaStr CEO and Founder, Jason Lemkin shared candid insights about what’s really happening in SaaS today.

In this Ask Me Anything Part 1, Lemkin answers the questions: 

1. What does SaaStr attendee data tell us about the state of SaaS?
2. Is outbound sales dead? 
3. When sales slow how do you keep the team motivated and push through?
4. How important are channel partnerships for sales and revenue?
5. When should founders make their first executive hires?

Let’s find out the answers. 

• SaaStr 780: From Outbound to Channel Partnerships: Your Burning Sales Questions Answered by SaaStr CEO and Founder Jason Lemkin

• SaaStr 779: 5 Things That Are Actually Working and 5 Things That Aren’t in B2B SaaS AI with Ironclad's CEO and a16z

• SaaStr 778: How to Leverage Pricing and Packaging to Drive Growth, Revenue, and Profit with Miro, Loom, OpenAI, and Splunk

Listen on Apple Podcast, Spotify or Google Podcasts

Just remember, i know they stress you out and drive you a bit nuts

But the customers that complain the most are often

the ones that care the most.

At least, it shows they aren't leaving.

Yet.

Your investors are wired to understand you may not hit the plan for the year Where they lose confidence is if:

- You sort of hide it

- You are running out of money

Run toward Bad News. Not from it.

© SaaStr 2024

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

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