Top 10 in Tech - What to know for Week ending September 13, 2024

SaaS METRIC OF THE WEEK

Growth Endurance Score (GES). This is a new one for me, and it's a metric that assesses a company's ability to sustain growth over time (something I have been discussing quite a bit lately, trying to maintain my own growth momentum). GES measures this efficiency by factoring in both net retention and customer acquisition efficiency. A high GES correlates with long-term business health and resilience. This score provides valuable insights for businesses aiming for consistent, sustainable growth. Bessemer has drilled deeper into it and Bessemer and plotted ARR growth lost YoY, and found that the decay is fairly predictable at 30%. That's a benchmark. In other words, you should expect next year's growth rate to be 70% of the current year as the stakes get higher.

GO TO MARKET

Go-to-market motions can be pretty specific and your GTM motions can impact your marketing strategy and your org chart. Robert Kaminski has distilled GTM motions into 5 types in this article based on a number of use cases; the summary diagram at the bottom is great.

NET REVENUE RETENTION (NRR)

NRR is one metric I'm a fan of and has become a new modern gold standard for SaaS growth. So much so that ChartMogul now has a trends and benchmark report: industry average NRR ranges from 90% to 100%, and the top-performing SaaS companies achieve NRRs 120%+. It's an action-packed NRR report, though, with lots of fantastic insight.

CHANNEL

If, like me and a lot of other enterprisy B2B SaaS, channel-based partnerships are something you want to explore, take a good read of BVP's guide to building SaaS channel partnerships. Selecting the right partners, aligning incentives, and establishing clear communication and training protocols are all included.

SAFEs

Last month we reviewed how much dilution founders typically experience during SAFE rounds. But how does that reflect how much equity founders typically give up during these SAFE rounds? Check this short but sweet Carta article with data on the average valuation cap by stage and fundraise size. For example, raising $250K-$499K ("Angel Round") often comes with a median valuation cap of $8M, while $5M+ rounds ("Jumbo Seed Round") see a median cap of $36M. Founders should focus on ownership dilution as much as valuation caps to understand the real impact on their equity.

AI

There are some fancy charts in this University paper on ChatGPT use: Journalists, developers, and marketers are the highest users of ChatGPT compared to other roles. Here is some great revenue data for the big AI players, as well as the Top 100 AI Consumer apps according to a16z.

SPEND

Kinda bleeding out of #6 above, AI vendors like OpenAI are leading first-time purchases and a sharp increase in AI-related AP spend, according to this great business spending report from Ramp. Companies are also leaning into independent contractors and pulling back on advertising, indicators of a more cautious approach as economic uncertainty continues for most. This shift toward AI and flexible labor indicates where companies see value in the current market.

PITCH DECK

I know pitch deck posts are popular here because creating the perfect pitch deck is every Founder's stress-dream. Data-driven VC offers some data drive insight on optimal decks from startups that nailed their presentations, highlighting key elements like storytelling, market validation, and financial projections.

PIPELINE

Looking for some inspiration to build additional pipelines for the rest of the year? The Growth Unhinged Blog has some inspirations for you to review.

CASE STUDY

Talk about diversification - with thin profit margins on their primary business, Uber has now diversified heavily into advertising. They are generating $1b in advertising revenue, according to their Q2 20224 report.