SaaS METRIC OF THE WEEK
DAU/MAU. The DAU/MAU ratio is a popular metric for companies that need to measure user engagement. Rule of thumb: Apps over 20% = good, if you have 50%+ - you’re world-class.
Top 10 in Tech - What to know for Week ending October 15, 2021
MARKETING
In early-stage start-up land, often time marketing is an after-thought. The Founder Coach listsseven things he wished he knew about Marketing early on and HeavyBit has a great article and video on early-stage positioning - one of the best things you can do starting up. Not sure how you rank? Go take the Tomasz Tunguz Marketing Scorecard.
VENTURE part 1
The State Of Venture Q3’21 report was released by CBInsights late last week - PDF version here. The run continues! Global venture funding reached $158.2B this quarter which is a 105% increase YoY compared to Q3’20 ($77B). The last 2 quarters have been the best ever in terms of total venture funding. The average deal size is up from $16m in '20 to $25m in '21.
VENTURE part 2
Crunchbase analysis shows that Tiger Global and the SoftBank Vision Fund are ahead of the rest of the field by a wide margin in terms of capital contributions for Q3 2021. SoftBank led 48 rounds and participated in 16 more. Tiger led 53! and participated in an additional 29. US VC firm a16z was the most active multi-stage investor in the U.S., yet with 46 investments (8 of which were outside of the US).
VALUATION
The public SaaS valuation listing a couple of weeks back created a bit of forward-multiple discussion - so I'm adding practical-private valuation-value this week with a downloadable sheet for ya: This SaaS-Capital Index worksheet (Excel) can be used as a starting point for a comprehensive valuation analysis for a privately-held SaaS business (from the SaaSCFO). Check the whitepaper PDF here as the starting point to work through this Excel sheet (especially the bit on how revenue should be measured). SaaS-Capital also reports quarterly on how this valuation index is performing overall. From a forward multiples perspective, the gap is widening between public and private SaaS- it sits currently at 50% on average.
SEO
If you are new to SEO you can consume this comprehensive starter-guide from Google on the topic but if you are just looking for a comprehensive guide of SEO best practices (like 180 of 'em) - take a bookmark (as it's constantly updated) and read of this page.
GROWTH
Back in 2017 I attended a HeavyBit conference with a mind-changing presentation from Patrick Campbell of Profitwell. I reference it all the time in this newsletter. This data has been updated for 2021 and the perspective hasn't changed too much: Acquire users, monetize them, keep them around as much as possible. This updated article re-iterates the point of the original pre-Covid presentation - SaaS companies seem addicted to solely acquisition-based growth, which is dangerous as competition is getting harder and more prevalent.
DATA
I don’t think I have more to add than the title of this article: "You Cannot Be Data-Driven Without Experimentation”, well OK fine, I do: The opposite of that is also a truth to hammer home "You Cannot run experiments successfully without being data-driven”. We all overestimate our experimentation skills AND our Data collection skills.
LINK BUILDING
This kind of seems like an SEO tactic of the past, where businesses build links to create a more organically positive Search rating. So is it still a relevant practice as we head toward 2022? Well......yah! But the rules have changed quite a lot. Check this article on how to optimize(by careful curation and intent) what to link.
CASE STUDY
Upwork - I have awesome full-time staff that came from shorter term gigs on Upwork, who is now worth $6 billion and at $400m+ in ARR. 2020+2021 gave them a chunky Covid boost and they are only just getting started with the good ol' fashioned "move-upmarket" strategy, with an absolute classic 80/20 rule in effect. 80% of clients are SMB's but 80% of the revenue comes from 20% of clients.