I spent the early part of this week hosting a Customer Success workshop with the amazing and customer-passionate Kirsty Traill in Auckland. The topic is fresh, so we’re making this newsletter a 100% customer-focused special. 

1. CUSTOMER CHURN: In SaaS Churn is the silent killer and the primary reason why customer success is so important. Here are 3 ways to evaluate and address customer churn.
2. PRODUCT TO CUSTOMER TRANSITIONS: Getting started - Many established companies have historically been product focused and Customer-experience transformations, just like digital-transformation, are organizationally hard. Here are the seven deadly sins to look out for with customer-experience transformations. Survey Monkey has a downloadable PDF on 7 ways a company can actionably put customers first, compare that to HubSpot who also have their (CRM Focused) 7 step version.
3. CUSTOMER ON-BOARDING: On-boarding is one of the most critical parts of the relationship with a customer. This is HubSpot’s 6-part playbook to make sure you have a well understand criteria for what an optimally on-boarded customer lost like and Sixteen Ventures have a great article (with a Trello template) on their approach
4. CUSTOMER JOURNEY: To add-on to the articles above, clearly mapping out a Customer Journey via a visual map is a great way to know at what points a Customer Success Team need to be involved (and what their responsibilities will be) via engagement models.
5. CUSTOMER JOURNEY: Another tie-in to above’s reference of engagement models. Visualizing the various interactions via customer journey mapping is actually replacing traditional sales funnel strategies as a means to close sales. 
6. CSM MODELS: Not all CSM’s are built the same. And it depends, based on stage and strategy, as to how your CSM teams will evolve…...but they will. Gainsight propose 5 basic kinds of CSM, along with a corollary org chart. But keep in mind IRL they all will be different hues. SaaSx have this model. Which one best resonates with you?
7. COST ATTRIBUTION: How do you account the cost of a CSM team? The team at Gainsight dive deep into this question and come up with some fantastic insights event though the question itself is complicated and the answer end up being non-monetary. Owning the renewal, up-sell, x-sell is a key delineation point between expense attribution to departments. 
8. CUSTOMER SEGMENTATION: In order to calculate cost for CSM’s, it’s best to segment customers out in order to understand efforts required. Chartmogul have this great visual and once again Gainsight take a look at how to Benchmark efforts over segmentation. Here is what they found. The median amount of ARR that an Enterprise CSM can manage is between $2M and $5M and The median amount of customers an Enterprise CSM manages is 10-50 - these revenue figures drop with mid and SMB customer segments and increase fairly dramatically with number of customers per CSM.
9. CUSTOMER OUTCOMES: The test of long-term success for a modern tech company is with their ability to demonstrate value to customers - which can determine whether a startup can continually generate waves of success that are sustainable.  Here is a playbook on mastering the art of successful (laser focused) customer outcomes.
10. CUSTOMER PRICING: In the SaaS world, great pricing prioritizes the customer’s success over that of the businesses. That logic seems a little counterintuitive, but the profitability of a customer in SaaS happens waaaaay after a customer becomes an actual customer. OpenView expands on this reasoning more in this complex post on achieving net negative churn (where the average revenue per customer increases at rates which offset any churn) by using customer based value metrics as a pricing strategy. 

POD OF THE WEEK: HeavyBit crank out great content. This podcast from them features Bob Tinker, former CEO of MobileIron and author of Survival to Thrival where they discuss the framework he developed for tech companies to build a go-to-market playbook.

BONUS: Next month (September 18-19 Pacific Time Zone) Survey Monkey are hosting on online Curiosity Conference looks to be a bunch of session designed to leverage feedback to make actionable customer-driven data-driven decisions. 

1. FORECAST: Great article and excel download from The SaaS CFO - A  SaaS Financial Plan for Startups and SMB’s. It also comes with a handy complimentary video tutorial to the worksheet.
2. SEED FUNDING: Tomasz Tunguz takes a look at the current state of seed funding to determine which categories of startups are thriving and which aren’t. WHAT’S HOT: AI, Blockchain, FinTech, Food and Beverage and Software. COOLING: Advertising, Analytics, Big Data, and Social Media.
3. RECURRING REVENUE: It’s a great business model for building out predictable revenues as long as you are not a gym (which sit at an industry average of about 30% churn). That predictability also takes a hit that when subscriber growth is driven by Stranger Things, Game of Thrones or The Hand Maiden Tales. The research team at The Information take a look at streaming TV revenue growth - specifically at Netflix as it relates to stock price and forward multiples (they are calling a 4x multiple for Netflix in comparison to SaaS industry average of 5.2)
4. FINTECH: Here is the 2019 H1 report from KPMG. It’s been a quiet start for fintech investment globally and Blockchain/crypto technology investment has returned to the levels of 2014-2016 following a two-year hype period.
5. EXPANSION: Growth is not just about acquisition. Far from it. As mentioned in prior newsletters, improving retention or monetization can actually impact growth 2-4x more effectively than improvements in acquisition. (see slides 41-46 for the real nuggets). Tips on how to optimize this via renewal available here. But I really enjoyed reading this working example of what that means to a companies growth and revenues from a product perspective from the company Buffer. 
6. MODERN WORK: The Industrial Revolution 4.0 is apparently coming and Slack is a company with products that have reinvented a large digital part of how modern workers choose to work, collaborate, and communicate. Slack are focused on being a thought leader in this new state of (modern) work, so they embarked on a global survey of about 17,000 knowledge workers and came up with some fascinating insights around alignment. Starting with the fact that organizations need to communicate their corporate strategy at least once a month to keep employees engaged and drilling into stats such as optimal number of meetings/day (no more than 4) and the loss of hours per person/per year simply by time spent switching between applications (it’s 130 hours!). PDF Version of report here
7. STARTUP CITIES: Yes, San Francisco is still the primary geographic location to nurture a fast growing tech company. But, unlike a lot of disaster movies, the tech world doesn’t end at the Golden Gate Bridge. Three things here: 1. From Inc Magazine comes a list of the top 10 US Startup Cities, 2. In a more extensive global report are data on over 200 exists from 17 Cities around the world. (Nearly every month for the last ten years, a tech company has been acquired or gone public for over a billion-dollars from outside the SF Bay Area) 3. The Startup Ecosystem report from StartupBlink (NZ Ranks 26th - room to move!)
8. PRODUCT MARKET FIT: From Y-Combinator this is a great (but 50 minute long) presentation on how to measure product-market fit via high fidelity data. Slides here if you can’t watch - which have really insightful charts and examples.
9. VALUE: The test of long-term success for a modern tech company is with their ability to demonstrate value to customers - which can determine whether a startup can continually generate waves of success that are sustainable. TL:DR Here is a playbook on mastering the art of successful customer outcomes.
10. INSTAGRAM: Feel like the amount of ads in your feed have increased? Well they have (pretty much doubled) since 2018. This article from The Information is a fascinating deep dive behind the (tense) scenes at Facebook and Instagram over the past 18 months.

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POD OF THE WEEK: From the B2B Sales Show featuring NZ’s own Matt Cameron on the topic of sales coaching. (Matt will be in NZ next week as part of SouthernSaaS)

BONUS: From Gainsight a Webinar on Thursday, August 29th (Pacific) at 11am on The best ways to find friction in your Users Journey (and how to fix it). 

1. SCALE-UP: Scaling any business is hard and especially scaling out the market-facing teams, in particular sales. Being ready is key. Here is a great list of questions to ask from Forbes about a companies readiness to scale teams.
2. STOCK OPTIONS: In today's competitive employment market, incentivizing people to stay put is no joke. Using stock options, especially in the US-based tech world, is a tried and true strategy. This post from The Startup is a comprehensive guide on how to deliver employee based stock option grants.
3. VIDEO: Connie Chan from a16z makes the case that eCommerce apps will have to also become video apps as commerce trends evolve. 
4. THE ROSE METRIC: People are the most important (and expensive) metric for any company, especially SaaS (yes, I would argue more important than the software product). Revenue per FTE is one metric to measure when it comes to people efficiency, but a better one perhaps is the ROSE Metric, (Return on SaaS Employees). This metric highlights the tradeoffs between headcount, recurring revenue, and EBITDA growth of a SaaS company.
5. LOYALTY: We are deep into the Age of the Customer and paid subscription-based premium loyalty solutions (it’s hard to figure out where to put the hyphens in that statement) are an emerging retention and value strategy for many brands - for example, Amazon Prime, Lululemon, and Nike Adventure Club. Clarus recently released a study on this growing segment, with great insights on what consumers expect from a paid program, how frequently they want rewards, and how it influences shopping behavior.
6. DEV TEAMS: An article from Marianne Bellotti that I wish I had read 15 years ago describing all the best engineering and management advice she stole from non-technical people. I’ll tease this with the reliability and security-based 100:10:1 rule; Brainstorm 100 things that could go wrong, pick 10 that feel like the most likely, investigate them, and focus on 1 critical problem.
7. SOCIAL COMMERCE: Great report from Business Insider on the Social Commerce sector - forecasting an $84.2 billion social commerce opportunity by 2024, assuming we can address the security and true issues.
8. STARTUP START-UPS: Brex launched out of seemingly nowhere a couple of years ago in San Francisco, proving that servicing startups is a lucrative business and famously ditching digital advertising in favor of physical billboards on buildings and public transportation stops. BONUS: If you are a Kiwi startup looking to use Brex as your internal Credit Card provider I have negotiated a NZ specific landing page with them (with zero fee card issuance).
9. SPEED MATTERS: I write this newsletter during my weekly public-transport commute times using Evernote - I prioritize speed and quality content over spelling, editorial tightness, and grammar. (My bad!) James Somers feels the same. As does Google, they obviously also made speed a priority for their tech stack and speed is UX moat for tech companies. Netflix is another great speed-focused tech company, who (amazingly to me) de-prioritized uptime in favor of speed and also become their own CDN as part of their speedy experience solution.
10. ZERO TO TEN: There are a bunch of founder stories out there telling quite scripted PR stories of their growth. But I found this post from the founder of HotJar very insightful (and full of great data on their industry unit economics) .

POD OF THE WEEK: How to Change Your Mind from Freakonmics Radio. A lot is empathy based.
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BONUS: Recruitment. Convincing someone to join your startup is a sales pitch all in itself. Y-Combinator partner Dalton Caldwell gives his advice on how to pitch this. 

1. DUE DILIGENCE - THE FINAL PART OF A FIVE PART SERIES. This five part series has covered how most VC's approach the quantitative part of conducting due diligence on potential investments. PART 5: REVENUE QUALITY - looking at the distribution of engagement across the user-base.
2. CAC PAYBACK: In past weeks, CAC (Customer Acquisition Costs) Payback has been discussed and it is one of the most important metrics for a SaaS business (as cash is king). Diving a little deeper into this metric and breaking it into constituents gives a much better indicator of efficiencies. Patric Mathieson has created a (downloadable) template and corollary blog post on how best to do this.
3. INNOVATION REPORT: Our buddies at Silicon Valley Bank just released their latest Q3 report for 2019 on the global innovation economy. The sector remains healthy, which is great considering the ongoing backdrop of global trade tensions and economic uncertainty - likely due to the recent flurry of high-profile unicorn IPOs. There is still a big concentration of capital into mega funds exceeding $1 billion and smaller funds under $200 million, with the spaces between hollowing out.
4. DIVERSITY: Hiring and building a diverse team is essential for a thriving business. In this article Google layout the framework on how to hire and retain diverse teams.
5. AAARRR: Aka "Pirate Metrics”. Thanks to Paul Burke for sharing this one. First proposed from 500 Startups, the great thing about this acronym based grouping of metrics is that it can be applied to non-software products or services as well as traditional SaaS: Awareness, Acquisition, Activation, Revenue, Retention, Referral.
6. INSURTECH: From CB Insights, this is a downloadable (and very shareable) PDF on the current state (Q2 2019) of the InsurTech industry. 
7. PRODUCT TOURS: Product tours are used in most web apps but there is a sophisticated art to design the right engagement that leads to conversion. Chameleon have just released this report from 15 million user interactions using product guidance to provide benchmarks and best practices for designing a sold product tour experience. 
8. PRICING: In the SaaS world, great pricing prioritizes the customer’s success over that of the businesses. That logic seems a little counterintuitive, but the profitability of a customer in SaaS happens waaaaay after a customer becomes an actual customer. OpenView expands on this reasoning more in this complex post on achieving net negative churn (where the average revenue per customer increases at rates which offset any churn) by using customer based value metrics as a pricing strategy. 
9. VIDEO: Storytelling via Video is an every growing and integral part of most tech companies Content Marketing strategies. In this post from Google, testing and experimenting via video is a new evolving approach (and hopefully using tools like NZ’s Wipster and PageProof!) 
10. EDGE: Compute requirements can be a serious bottleneck in todays ever connected cloud and mobile world. Computational processes need to be moved from central servers and infrastructure over to more localized devices to minimize latency and optimize user experience (looking to you to figure this out Siri!). This e-book from DMI explains why edge computing is important now and will be continue to be even more significant in the future.

POD OF THE WEEK: Great interview from Shopify’s reluctant CEO, Tobias Lütke, on NPR’s How I Built This. Great segment in there on how they built their marketing based hypothesis testing.

BONUS:  Book publisher Taschen just released an interactive page that details the history of web design, from 1990 onwards. It details the emergence and growth of Flash, the evolution of the web developer, and the concept of virality that began to emerge in the early 2000s. It also takes us to 2019, where the "next generation" of web design is still being realized, mobile rules, and AR and VR use causes are being prepped for prime time. 

1. DUE DILIGENCE - PART FOUR OF A FIVE PART SERIES. This five-part series (over the next five weeks) covers how most VC's approach the quantitative part of doing diligence on potential investments. PART 4: RETENTION - this one is all about life-time value.
2. CYBERSECURITY: Software is eating the world and the digitization (much better term than disruption) of many businesses and industries creates  whole litany of risks. McKinsey discuss how to manage and integrate security into the digital transformation agenda.
3. US VC: Check these 21 charts showing current trends in US venture capital. Mega-deals still on the rise and 2019 on pace to surpass 2018’s banner year for VC.
4. FREEMIUM: Is it a good or bad strategy for your SaaS business? ChartMogul weighs the merits (and downside) of this strategy and also asks you to challenge your assumptions.
5. PRODUCT MARKETING: PLG (Product Led Growth) has been referenced in past newsletters and can create massive virality if executed well (and the product can support the effort). UserPilot just launched a great guide on how Marketers can really execute on Product-led Growth Marketing.
6. CLOUD: Big tech dominates public cloud and, based on recent earnings calls, all three big providers (Amazon, Microsoft and Google) showed big gains in this segment of their business: AMAZON: Grew AWS revenue by 37% YoY, increasing to $8.4 billion for the quarter MICROSOFT: Azure revenue was up 64% from the prior year. GOOGLE: The cloud business unit reported an $8 billion annual revenue run rate - that’s double what was reported last year.
7. FEMALE FOUNDERS: The gender gap for startup investment dollars hasn’t broken past 3 percent for female-only founded startups in the last year, but Global dollar volume for startups with a solo female founder or at least one female founder is at 14 percent so far this year, compared with 10 percent in 2014 Several VC firms report progress in funding female-founded companies: 38 percent for Kapor Capital and 28 percent for M Ventures' second fund.
8. PRICING: Packaging up offerings and finding the optimal pricing and features structures for both customers and business unit economics is incredibly hard and never right. The team at Heavybit know this very well and this article from them on using feature flags is a great read.
9. GROWTH: I love this article from First Round Capital. Mainly as it justifies my sentiment around rigor, data and insight. To quote: "Growth is about implementing a rigorous, customer insight and data-driven process with sustained effort to remove friction"
10. AI: In the Tech B2B World, we are reaching the tail end of the age of SaaS and entering the Data/Intelligence age. This article does a great job exploring this next wave of intelligence based tech and the impacts on the software industry coming in the next 10 years.

POD OF THE WEEK: I’m cheating this week as it’s actually an on-demand webinar from Oracle on the trends impacting the venture capital market.
BONUS: From NZ, the Absolute IT renumeration report is out and shows that the national median base is on the rise again.