This will be my last post of 2022, so it's a forward look at the Holiday season, 2023, planning, and beyond. Have a great holiday season, and thanks for your continued readership. See y'all in 2022.
1. SaaS METRIC OF THE WEEK: Here is a good list of 10 growth metrics to track for 2023. No surprises here: Churn, LTV, CAC, CAC Payback (see #10 below), but the Quick Ratio is good, as is Customer Health Score. One that needs to be added to that list, though, and referenced in a newsletter I'm unable to link here from Matt Cameron (he has no web version of his newsletter) is Velocity! Here is an older slide from Matt's SaaStr presentation explaining that formula more, or watch the presentation in its entirety.
2. GROWTH: Gartner predicts an acceleration of business software spend in 2023, up to 11.8% growth from 9.8% in 2022 - monetarily, that is $100B, and more importantly, SaaS spend in the enterprise is forecast to grow 17% to $195 Billion. Cloud spending overall is expected to grow 22.1% in 2022 (from 18.4% in 2021)
3. eBOOKS: Holiday season is here, and who doesn't want to tuck into ebooks covering marketing, sales, development, web3, etc. - there are over 600+ free here. Also, take a looksie at these 28 Free AI, Machine learning, Data Science, and Python eBooks - ready for download directly to the device of your choice now.
4. FINANCIAL FORECAST: Your 2023 new financial year is just around the corner! Now is always the second best time to get started on getting started (the first being two months ago). This is an excellent article with a complimentary excel download from The SaaS CFO - it's a SaaS Financial Plan for Startups (and also works for most SMBs). It also comes with a handy complimentary video tutorial for the worksheet.
5. OPERATIONAL PLAN: Because your new strategic year is just around the corner and now is the second best time to get started getting started, Dave Kellogg has a great How-to guide on presenting your fantastic new operating plan to your board.
6. BUDGET: This could be a whole newsletter by itself: How much do you plan on spending on your 2023 operational plan? SaaS Capital has a wonderful B2B SaaS Spending Benchmark report to best forecast what to send on sales, marketing, CS, COGS, and R&D. And because 2023 will be the year of LeanOps - here is how to manage burn and extend your runway into 2024 from Capchase.
7. UNCERTAINTY: Will '23 bring a double-dip recession, extra inflation, and a new pandemic? We are in uncertain times, so when considering #4, #5, and #6 above, read this article from First Round Capital covering 6 tactics for rethinking planning in uncertain times.
8. COMPENSATION: Bookmark this free library of 20 sales compensation plans that can let you scenario plan into 2023. This is seriously next-level content marketing that has a significant amount of value.
9. SAASOPS: How many SaaS apps are too many in an Enterprise organization? According to the State of SaaSOps Report from BetterCloud, organizations are currently using 130 apps on average! Organizations are still using more SaaS apps than ever, but growth has slowed slightly in '21 and '22. But the net gain of SaaS apps used is still up 18% this year, with more to come in 2023, according to Gartner (see #2 above).
10. CASE STUDY: Speaking of uncertainty (see #7). Salesforce, the world's largest SaaS company, broke with established practice for its Q3 reporting and said it would not provide financial guidance for next year as "they just didn't know.". What is even more profound than that statement is in their underlying metrics: With some back-of-the-napkin/Twitter math, they currently have a CAC Payback period of 155 months (yeah - just short of 13 years)!!!! Certainly a case study for many sales and marketing layoffs in the new year.
POD OF THE WEEK: One of the best growth levers you can work on for 2023 is pricing and monetization. So check the podcast about the art and science of pricing from Lenny's Podcast.