All’s quiet at SaaStr Square Park as yet another SaaStr Annual draws to a close. As Jason Green, Founder and General Partner of Emergence Capital noted, the event is a diaspora of SaaS. It’s a fair characterization! Every year at SaaStr Annual a community of people gather back at the homeland to renew their connections and share their origin and faith. The SaaS diaspora indeed!
Today’s content lived up to the level that was established by the first two days of the conference, with speakers from early stage startups to big, established SaaS businesses with $1B exits (yes, we’re looking at you ServiceNow!).
Topics ranged from the current state of SaaS to busting startup myths, the journey to a billion dollar exit, founder burnout, successfully managing hypergrowth, customer acquisition, B2B data strategy—and everything in between.
Here we provide just a handful of choice learnings from the final day of SaaStr Annual 2018:
“ICOs are a fundamental change in the way that startups fundraise. In December 2017, ICOs raised almost as much capital as Series A did globally. For a small number of companies, it’s a viable fundraising mechanism. It’s an important trend that’s going to impact startup land broadly.” – Tomasz Tunguz, Venture Capitalist, Redpoint, @ttunguz
“I think M&A is the weirdest thing. Everyone thinks they’re going to get acquired, but the odds are crazy.” – Jason Lemkin, Founder, SaaStr, @jasonlk
“It’s easy to assume that you’re acquirer knows exactly what they’re going to do with you post-acquisition. But a lot of companies don’t have a well-defined process. It’s easy to be lambs to the slaughter, but you can have influence over the acquiring business,. You can go in passive or with a point of view.” – Dave Yarnold, CEO, ServiceMax, @dyarnold
On the best business ideas:
“Sometimes the best businesses are the areas others have overlooked because they’re not so interesting.” – Therese Tucker, CEO, Blackline, @BlackLine
“When you start a company, you’re betting on an idea or vision that nobody else already had. Either they overlooked it, or looked at it and valued it differently than you did. When you start a company, it’s just a bet that everyone else was wrong.” – Therese Tucker, CEO, Blackline, @BlackLine
On the “playbook” for success:
“There is no playbook for success. If there was a playbook that worked for everyone, then everyone would go out and make a gazillion. Companies are like people, they have a unique DNA, a unique culture. What works for one will sink another.” – Therese Tucker, CEO, Blackline, @BlackLine
On CEO commitment:
“If you are the CEO of a small company, you have to be committed to doing whatever it takes to make your company successful. I’ve bought bagels, coded, and even cleaned toilets. Because I wanted my company to succeed no matter what.” – Therese Tucker, CEO, Blackline, @BlackLine
On raising money:
“Avoid building your business with the intent of raising money. You’re losing the focus on the business when you do that. You’re falling in love with the idea. The person on the other side doesn’t know your market or your business. Focusing on impressing them over building your business and getting customers is a bad idea.” – Therese Tucker, CEO, Blackline, @BlackLine
“How do you hire people who are better than you? Look for people who are enlightening you just in the interview process and who are results-oriented. That way you won’t need to manage what they’re doing (which you may not even know how to do) but just hold them accountable for results.” – Jason Cohen, CTO and Co-Founder, WP Engine, @asmartbear
On when you can’t “eat your own dog food”:
“If you can’t use your own software, you have to embrace the domain. Bring in domain expertise. Watch customers use your product: ride alongs. See what customers are dealing with when they’re using your software. It’s amazing to see your business from the end-user perspective.” – Dave Yarnold, CEO, ServiceMax, @dyarnold
On the billion dollar exit:
“Companies aren’t sold for $1B. They’re bought for $1B. And that’s because there’s a thought that they will serve a strategic function in the future.” – Jason Green, Founder and General Partner, Emergence Capital, @jasonegreen
“I think of hypergrowth as any amount of growth that stresses the systems that you currently have in place and requires you to iterate on and grow those systems.” – Julio Avalos, Chief Strategy Officer, GitHub, @github
“We assume as a tech industry that everyone is infatuated with growth for the sake of growth, disruption for the sake of disruption. You lose sight of: growth towards what? for what reason? Even questioning whether you want to be in hypergrowth is a reasonable first question. But the growth needs to be in service of a mission, of a vision. ” – Julio Avalos, Chief Strategy Officer, GitHub, @github
On the humanization of technology:
“Software doesn’t just fall from up on high. There’s a human being that built that. Humanization of technology. What does that product do for humans? Is this growth going to be good for the customers and for the employees inside this building.” – Julio Avalos, Chief Strategy Officer, GitHub, @github
On culture fit:
“Culture fit—nobody knows what that means. It’s taken on the level of fetish in the Valley. It too often gets used to back down candidates for reasons which are unclear to you, unclear to them, and you are not in a position to articulate. And there is danger in that. Take that time to define what culture fit means for your organization, write it down, communicate it. That is a foundational exercise that needs to happen.” – Julio Avalos, Chief Strategy Officer, GitHub, @github
On market research:
“In the early days, we did a lot of user and market research. It’s a little out of the current Silicon Valley context. It’s more old school business plan MBA, but I think it’s a powerful tool. We talked to a bunch of people about their problems to try to hit on something. Looking for extreme users — the ones who say stuff that’s a surprise to you — is a good place to start.” – Nate Smith, Founder and CTO, Lever, @nateps
On just starting up:
“When you’re a new startup, you’re not competing against your competitors. You’re competing against the fact that people don’t even know you exist.” – Garry Tan, Co-Founder and Managing Partner, Initialized Capital, @garrytan
“If you can take a single strategy and you can replicate it more than once and teach it to someone else who can replicate it, that’s the time to hand it off and start scaling that channel.” – Leore Avidar, CEO and Co-Founder, Lob, @bavidar
On data strategy:
“B2B data used to be just a few fields of data and companies didn’t have a strategic view on what to do with data. We’ve gone from an environment of scarcity to abundance. But this hasn’t ‘solved the problem,’ just shifted it – Mark Godley, President, LeadGenius, @mgodley21
“Too often, people don’t know what their go to market strategy is, so they don’t know what data to prioritize, to invest in, and to leverage. You don’t just need data. The question is what do you need the data for?” – Katie Bullard, Chief Growth Officer, DiscoverOrg, @Katie_E_Bullard
“Shopping for B2B data used to be like shopping at In and Out Burger: it was a limited menu and you knew what you were getting. Now it’s Cheesecake Factory times 10! There’s a lot of delicious stuff on the menu, but a lot of it is superfluous sugar and fat.” – Jim Gearhart, Sr. Director, Sales and Marketing IT, Zendesk
“It’s the downstream effect of the data that’s critical.” – Karen Steele, CMO, LeanData, @karenmsteele
On investing in systems and software:
“You don’t start coding something without doing design. In terms of business strategy, you want to understand your strategy first, and then understand the data you need, then shop for data vendors, then contextualize that data.” – Jim Gearhart, Sr. Director, Sales and Marketing IT, Zendesk
“Investing in systems isn’t something you should have to learn the hard way. When you have a homegrown billing system sitting around some other homegrown tool. Do you want to be in the biz of building out your own homegrown billing system? app tracking system? HR tools? What do you know about these things? In our case, we found we were building our own mousetraps that weren’t as good as what was out in the marketplace—and sinking 2 years of development time into it.” – Julio Avalos, Chief Strategy Officer, GitHub, @github
“Investing in the right systems for your business that are going to scale with you. It’s always a painful exercise. You don’t know what the right stack is going to look like. If you don’t have a view of your goals, you’re in a situation where the systems might hamper you: if you can’t bill in other geographies because of your home grown billing system, if you can’t hire the right people, etc. You’re flying 100% blind if you don’t have those systems in place.” – Julio Avalos, Chief Strategy Officer, GitHub, @github
Let’s close out our wrap up with this short and sweet quote from Jason Cohen (@smartbear), CTO and Co-Founder of WP Engine:
“Building fulfillment is more important than building ARR.”
Even with all the emphasis at SaaStr Annual on ARR, in the end, the learnings go way beyond simply how to grow revenue. And ultimately, that’s the allure and power of the event: attendees come to get the tools to build and grow a company from startup to a billion dollar buy-out, but, equally importantly, we all come to have some fun along the way, and for the assurance that we’re not doing it alone.
Thanks again, Jason Lemkin and the SaaStr crew for another amazing event. We were honored to be a part of it and are already looking forward to next year’s event.
If you’re already jonesing for more insightful content and networking with your peers, come join us at Subscribed 2018 in June in San Francisco, or one of our other Subscribeds in your region. Subscribed is THE event for disruptors, innovators, and business leaders in the Subscription Economy to join together to share best practices.