Inc - Yes, You Need to Focus

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

This is classic VC and social media advice, and of course, so much truth in it

But … but … the world in SaaS has rapidly gone multi-product and platform the past 18+ months or so

• Much more that even beforel
• Almost every SaaS leader I’ve invested in by $20m ARR has 2+ core products in market, but it’s more than that. They are building platforms.
• Platforms often require 4-5 core products to even be fully featured.

As you enjoy the Holidays, why not set yourself up for success to attend the biggest SaaS event of the year — SaaStr Annual, May 13-15 2025!

Grab your tickets now before prices go up Jan 4:

• Save 20% on 1-2 tickets, $200 savings
• Save 30% on 3+ or more tickets, $350 savings
• on each ticket!

But should you miss these holiday savings: 

• Startup tickets will be $1099 on Jan 4th
• Big Co & VC tickets will be $1299 on Jan 4th

This is your chance to hit your goals next year and experience the biggest SaaS event of the year. Not to mention, this will be 11th SaaStr Annual so we'll be adding even more new ways to network and get together, building off the success of the CEO + CRO, CMO, CCO and CFO summits we launched in 2024.    

There are really three modes from a VC perspective during a fundraising pitch:

1. You Almost immediately want to do the investment. You go into the pitch already very interested, and within 15–20 minutes, you want to do it. This is 80%+ of the investments I’ve done. These are also a great use of your time. Almost all my investments at SaaStr Fund, I’ve told the founders before the meetings end that I’m in if everything they’ve said checks out. Not all the deals, but probably 80% of them.
2. The “Almosts”. These are brutal as an investor and confusing for founders. There’s good stuff there, so it’s close. The numbers are strong, but the CTO isn’t good enough. Or you love the team but the market is just too small, or growth is good but not great. You hope learning more will get it from Almost to Yes. But it almost never does. These end up burning a lot of cycles and often confusing founders, who see it’s an Almost and burn cycles trying to get it to Yes as well. I now try to immediately tell the Almosts it’s unlikely to be a Yes to save everyone time.
3. The Likely “No’s.” A lot folks will take meetings to learn. I won’t. They waste a ton of time. There is no point IMHO in meeting any startup you don’t think you would potentially invest in. Some will take these meetings JIC. I find them torture. It’s why I no longer do “favor” meetings or even take most warm intros. They frustrate everyone and waste precious time.

Vendor Viability. The question for bigger customers especially on if a vendor will actually stay around if they buy.

This remains a large risk with start-ups. But it’s been mitigated to some extent in the minds of customers. With 100+ public Cloud companies, it’s now a bit clearer that at least after a certain point in time, SaaS vendors have a lot of stability. But as you can see above with Bench abruptly shutting down after 13 years and raising $100m+ … you never know.

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

Read how Duro Labs increased integration adoption, reduced engineering time for integrations, and launched them 10x faster.

It’s tough to spend even $1m a year effectively on most digital spend for most categories of B2B software:

• Putting aside Unicorns and folks that have raised monster rounds, in my experience, most enterprise SaaS companies struggle to deploy more than $40k-$50k a month on Adwords effectively.  Maybe $100k if they are really, really good at it (which most aren’t).
• They may also be able to deploy a similar amount on G2, Capterra and other lead-gen solutions. Do those, too.
• And retargeting almost always works.  Upload your list of prospects, and at least retarget them on X, LinkedIn, Facebook, Google etc.  This is cheap and while it’s more a “second touch” than new lead generation, it almost always works at least a little bit.  A little bit.
• And marketing, done well, on platforms almost always works.  It’s hard to do well, but getting top placement on the Shopify ecosystem seems to work, for example.  To a point.
• SMB-focused SaaS companies often have better performance with Facebook in particular, and can often deploy more there. And LinkedIn always has reach, it’s expensive but worth trying.  But paid social for SaaS is generally poor and limited.

But overall, most B2B SaaS companies struggle to find enough “digital” places to deploy capital than have even mediocre (1x) returns.

The B2C playbook here just doesn’t work as well in B2B. The volume just isn’t there.  Facebook Ads for most B2B? Doesn’t really work at all, unless they approach a consumer-like buyer.  But in B2C and e-commerce? It remains a Top 3 channel for many.

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