Patrick Campbell, CEO, Price Intelligently presented "Lessons learned from 3k SaaS Companies" on the Playbook Stage at SaaStock 2016.
Watch the video here: https://www.saastock.com/blog/view/lessons-learned-from-3k-saas-companies
SaaStock is Europe’s premier Conference for B2B SaaS at RDS, Dublin Ireland in September 2017 www.saastock.com
10. Happy customers big and small
ProfitWell
SaaS pricing software
and tech enabled
services
Free financial metrics
for subscription
businesses
@PriceIntel
11. We’ve seen inside more SaaS companies than
anyone else on the planet.
@PriceIntel
12. The market is becoming saturated and unit
economics just aren’t what they used to be…
@PriceIntel
13. Our world is more competitive, making
switching costs easier.
@PriceIntel
14. Competition is growing
N = 289 SaaS companies, +/- 3.44% MoE at 95% level
0
2
4
6
8
10
12
5 Years Ago 3 Years Ago 1 Year Ago Today
#ofCompetitors How many competitors did you have during the following periods?
@PriceIntel
15. Competition is here
0%
10%
20%
30%
40%
50%
0 to 2 3 to 5 6 to 10 11+
%ofRespondents
How many competitors do you current have?
(Companies around for less than 1 year)
N = 547 software companies
@PriceIntel
16. The relative value of features is declining.
All software is going to $0.
@PriceIntel
17. “Differentiation” isn’t what is used to be…
N = Varies by line, but minimum of 10,000 customer respondents per line
0%
25%
50%
75%
100%
125%
4 Years Ago 3 Years Ago 2 Years Ago 1 Year Ago Today
WTPas%ofWTP4YearsAgo
Willingnessto pay over time relative to WTP 4 years ago
Core Features Single Sign On Integrations Analytics
@PriceIntel
19. Acquiring a customer is getting pricier
N = Varies by line, but minimum of 453 companies per data point
-‐25%
0%
25%
50%
75%
4 Years Ago 3 Years Ago 2 Years Ago 1 Year Ago Today
CACas%ofCAC4YearsAgo
Blended CAC relative to four years ago
B2B B2C
@PriceIntel
20. We make matters worse by focusing on the
wrong fundamentals
@PriceIntel
23. We love talking about acquisition
0%
25%
50%
75%
100%
Acquisition Monetization Retention
%oftotalarticles
Category of growth articles written from 2014 to 2106
N = 25,679 blog posts written between 2014 to 2016
@PriceIntel
25. We love building for acquisition
0%
25%
50%
75%
100%
Acquisition Monetization Retention
%oftotalcompanies
Category of B2B SaaS companies
N = 6,324 companies currently active
@PriceIntel
27. What’s most important?
0%
25%
50%
75%
100%
More logos Making more money per
customer
Keeping customers around
longer
%oftotalcompanies
C-Level/Founder Growth Preferences
N = 1,432 SaaS companies, +/- 2.19% MoE at 95% level
@PriceIntel
28. What’s most important?
N = 1,218 SaaS companies, +/- 2.61% MoE at 95% level
0%
25%
50%
75%
100%
Acquisition Monetization Retention
%oftotalcompanies
C-Level/Founder Spend Their Time
@PriceIntel
29. There are clear winners and losers in this
environment.
@PriceIntel
30. SaaS Death correlates to acquisition focused teams
0%
25%
50%
75%
100%
Less than $2.5M ARR $2.51M to $5M ARR $5.01M+ ARR
%ofRespondents
Of those companies who died, what was the makeup of their growth
Primarily
Acquisition
Growth Balanced
Growth
N = Minimum of 30 companies per category who died over the past 4 years
@PriceIntel
31. Balanced growth velocity is much larger
0%
25%
50%
2012 2013 2014 2015
%ofRespondents
How do growth rates compare to our two growth groups?
Primarily Acquisition Growth Balanced Growth
N = Minimum of 512 companies per segment pulled from the middle 2/3 of companies in terms of growth rate. This, along with a
dampening model was used to control for outlier spikes in growth rate.
@PriceIntel
35. Buyer Personas
Table Stakes Tony
• Valued features:
• SFDC Integration
• Chrome extension
• Least valued features
• Analytics
• API access
• WTP = ~$10/month
• CAC = ~$22
• LTV: $160
Advanced Arnie
• Valued features:
• Analytics
• API Access
• Least valued features
• Chrome extension
• Premium support
• WTP = ~$25/month
• CAC = ~$56
• LTV: $325
@PriceIntel
36. We don’t know our buyers that well
0%
25%
50%
75%
100%
Thought about them Central document Quantified buyer personas
%ofRespondents
Which single category best describes your buyer personas?
N = 1,647 SaaS companies
@PriceIntel
37. We don’t do a lot of cust dev conversations
0%
25%
50%
75%
100%
Less than 10 11 to 25 26 to 50 51+
%ofRespondents
#
of
cust dev conversations
How many cust dev conversations are you having per month?
N = 1,647 SaaS companies
@PriceIntel
38. We don’t send any cust dev surveys
0%
25%
50%
75%
100%
0 1 2 3+
%ofRespondents
#
of
cust dev surveys
How many cust dev surveys are you sending each month?
N = 1,647 SaaS companies
@PriceIntel
39. We aren’t truly testing that much
0%
25%
50%
75%
100%
0 1 to 3 4 to 10 11+
%ofRespondents
#
of
tests/experiments
How many tests or experiments are you running each month?
N = 1,647 SaaS companies
@PriceIntel
41. If we improve each lever by the same
amount, which lever causes the most growth?
@PriceIntel
42. Impact of improving each
growth lever
3.32%
0%
5%
10%
15%
Acquisition Monetization Retention
%impactonthebottomline
Impact of improvingeach lever by 1%
N = 578 SaaS companies, +/- 2.89% MoE at 95% level
@PriceIntel
43. Impact of improving each
growth lever
3.32%
6.71%
0%
5%
10%
15%
Acquisition Monetization Retention
%impactonthebottomline
Impact of improvingeach lever by 1%
N = 578 SaaS companies, +/- 2.89% MoE at 95% level
@PriceIntel
44. Impact of improving each
growth lever
3.32%
12.70%
6.71%
0%
5%
10%
15%
Acquisition Monetization Retention
%impactonthebottomline
Impact of improvingeach lever by 1%
N = 578 SaaS companies, +/- 2.89% MoE at 95% level
@PriceIntel
45. Improving retention and monetization has 2-
4x the impact of focusing on acquisition.
@PriceIntel
46. What we find important
0%
25%
50%
75%
100%
More logos Making more money per
customer
Keeping customers around
longer
%oftotalcompanies
C-Level/Founder Growth Preferences
N = 1,432 SaaS companies
@PriceIntel
47. What works for growth
3.32%
12.70%
6.71%
0%
5%
10%
15%
Acquisition Monetization Retention
%impactonthebottomline
Impact of improvingeach lever by 1%
N = Data from 512 companies
@PriceIntel
51. Three ways to overcoming acquisition addiction
• Know your numbers
• Quantify your buyer personas
• Implement a customer development process
@PriceIntel
62. Your Cust Dev Process
Customer/Market
Research
Communication
Plan
Week:
1 2 3 4 5 6 7 8 9
Impact
Analysis
Customer
Advisory
Panel
Implement
Changes
Step:
@PriceIntel
63. Your Pricing Committee
Main Decision Maker
(could be a member of the committee, as well)
Main Coordinator Typically in Product or Marketing
Product Leadership Corp Dev/Finance
Sales Leadership Marketing Leadership
@PriceIntel
64. We’re in a customer value centric world.
@PriceIntel
65. You will be left behind if you think you can
brute force your growth.
@PriceIntel
66. Thankfully, there’s a community around you
to help you grow, but you need to take the
first step.
@PriceIntel
67. Here’s how we’re going to help today
• SaaS Pricing Workshop – 1:30pm
– Pricing workshop, where we’ll walk through the steps to quantify
your personas and answer every pricing question you’ve ever had
• SaaS Benchmarking Data Dump – 4pm
– We have the world’s largest SaaS dataset, and we’ll be walking
through some key benchmarks and differences between
companies doing well and those in trouble
@PriceIntel