Tom Tunguz followed up his article on free trials survey ( presented at Saastr 2019) with another insightful post on assisted and unassisted free trails. They are linked and should be read together. The key points that you need to dig deeper into are :
Tom Zsomborgi is the CFO of Kinsta a managed WordPress hosting company. One of the most simple and honest summary of growing your saas business is his post in the Kinsta Blog earlier this year.
In a recent TrustRadius report on the growing Vertical SAAS market they pointed to an article by Brian Feinstein of Bessemer Venture Partners which pegs growth of Vertical SAAS market between 2010 and 2016 at 3X – from 50B to 150B. He ought to know. Bessemer has a large Vertical SaaS portfolio across education, real estate, construction, healthcare et all.
January 2020 CCPA kicks in. We need to pay attention as regulation catches up with invasive technology world over.
The ability to make any use of personal data collected will be severely restricted in a similar manner as it is already in place in European Union through the General Data Protection Regulation. GDPR is one of the most comprehensive data protection laws in the world today. CCPA is considered to be one of the most significant legislative privacy laws in the US.
As always, the Blissfully Annual SAAS report has a wealth of interesting findings. App turnover is common (I get that – with so many me too products with little differentiation chasing the same market) – typical mid sized companies changed 39% of their stack last year. 71% of companies has at leas one SaaS subscription with no billing owner.
Tomasz Tunguz delivered a session on 10 Learnings About Free Trials at Saastr 2019. Based on a survey with 590 respondents – from single digit ARR to public SaaS companies and a wide variety of price points and customer profiles. 1000+ lines of R code was written to make sense of the data.
Pricing your SAAS is easy. Just follow the per user/per month formula and build multiple levels based on truncated product or cascading features (higher you pay more you get). According to people who know, SAAS and SAAS pricing it is time to rethink this approach.
In 2015 Brad Feld mooted the idea of the Rule of 40% for SaaS companies. The rule states that “your growth rate + your profit should add up to 40%. So, if you are growing at 20%, you should be generating a profit of 20%. If you are growing at 40%, you should be generating a 0% profit. If you are growing at 50%, you can lose 10%. If you are doing better than the 40% rule, that’s awesome.”
I was amazed when I learnt that Zapier actually had no office for their (then) 140 member team and everyone works remotely from all over the world. 37 Signals, now Basecamp championed the idea in their 2013 Book – Remote : Office not required. Written by @Jason Fried co-founder of Basecamp it is a must read to understand the changing dynamics. I highly recommend this.