1. SaaS METRIC OF THE WEEK: Usage-based pricing and MRR/ARR models are often mentally complex to compute collectively (I know this from experience), so this article was a sight for sore eyes earlier this week, discussing the mental mapping required from Annual to Monthly and Usage-Based Metrics (and introducing Implied ARR) from David Kellogg. A recent analysis of usage-based pricing from Bessemer Ventures is here to help you think about your own pricing models.
2. VERTICAL SAAS: A lot of Big Tech is threatened by narrowly focused SaaS companies taking market share in niche areas and building massive businesses (for example, Toast is currently valued at $10B +). Check the difference between vertical and horizontal SaaS here. Then, look at how these vertical SaaS companies are taking market share from those cloud giants and how AI may accelerate everything in Vertical SaaS even more.
3. VENTURE: According to a new report from Pitchbook - VC funds have hit a pretty significant low, -17% (that's a minus, not a hyphen), the worst in a decade. Downhill, this means that Firms will need more access to capital. Stability is forecasted for 2023, though, with generative AI as the promising focus.
4. EXPONENTIAL GROWTH: It's all marketing hype and doesn't exist in real life. Take a look at this article, which explains it more by taking a deep dive into the numbers of "Exponential" companies such as Slack ($0-$10m ARR in 10 months!!), Facebook, and HubSpot. According to McKinsey, despite the sector's image as a bastion of hypergrowth, only a tiny share of SaaS companies sustains growth rates above 30 to 40 percent.
5. DEVOPS: Google Cloud's DevOps Research and Assessment (DORA) team has just released their 2023 DevOps report. AI has yet to deliver substantial benefits to development teams - but in my experience, that is a lagging metric. Current key success factors for high-performing teams include user-focused development, rapid code reviews, and a high-trust culture.
6. CONTENT MARKETING: Mastering great content writing is a skill - and I've snagged an excellent guide for us all here on that topic; here is great info on how to plan a data-backed B2B content marketing strategy
7. FREEMIUM: Freemium is only sometimes the best pricing strategy for every SaaS startup. Beyond free trials and freemium models, you can give your users Opt-In Free Trials, Opt-Out Free Trials, Usage-Based Free Trials, Freemium, New Products, and Sandboxes.
8. -1 to 0: One for your tech-dictionaries and inspiration read when you need to think differently. In startup land, it's a tech-ism on "going from 0 to 1". But this article argues that we are missing a step - the "-1 to 0" stage is key. It's choosing your next decade's focus and replacing good ideas with great ones.
9. TECHNO OPTIMIST: Don't put away your tech dictionaries just yet - pencil this one in and save it for when you have time, as it's a longer form read to process. Andreessen Horowitz is back with a new, post-pandemic manifesto, 'The Techno-Optimist Manifesto.' Their Pandemic Manifesto was "Time to Build," this new one is an extension of that that argues against the current pessimistic view of technology, embracing it as a crucial driver of societal progress and solution to problems. It encourages fostering growth through technology, asserting that it's pivotal for overcoming challenges and improving human living standards.
10. CASE STUDY: Supabase's CTO discusses the company's unique "Launch Week" approach, emphasizing regular product updates and team autonomy. Integral to their Product-Led Growth strategy, this method has shifted the needle with their growth.
POD OF THE WEEK: Beneficial for me - Modern Engineering Management with Russell Smith, co-founder and CTO at Rainforest QA. He discusses some core engineering management concepts essential for success in today's fast-paced, mainly remote, and highly competitive engineering environment.