1. SaaS METRIC OF THE WEEK: CHURN: In this post, Lenny Rachitsky asks, "What is a good monthly churn for a SaaS business?". Zero is the obvious correct answer - but he took to a benchmarking exercise and sourced good data to develop this chart. For B2C SaaS: 3% - 5% churn is GOOD, and less than 2% is GREAT. For B2B SMB: 2.5% - 5% is GOOD, less than 1.5% is GREAT. For B2B Enterprise: 1% - 2% is GOOD, less than 0.5% is GREAT.
2. DEV TOOLS: Anna Debenham of Boldstart Ventures was given access to a subset of this year's raw data from OpenView's Product Benchmarks Report focusing on dev tools. The report reveals trends in dev-tool product-led growth strategies - 31% organic leads and increasing reliance on sales-generated leads. Conversion from site visitors to users is 10% (median), with varied activation rates depending on the product. The median 28-day retention rate is 23%, and conversion to a paid account is 5%. The article discusses a new entry for our Tech Dictionaries - a "sandwich model" strategy, combining product and sales for sustained growth.
3. FUNDING: One of the cool things to come out of the SaaStr Annual conference every year is the updates to the SaaS Funding Napkin from Point Nine Capital. 2023 has been a tough year - so it's great to finally get the in-depth dive into what it takes to raise capital in 2023 and the updated TL;DR napkin. You can also watch the SaaStr Annual 2023 presentation from last month here.
4. VENTURE: Last month's post about the SaaS IPO marketplace was popular, and I had a few responses debating whether the potential end of the IPO freeze is happening now. Well, guess what? It looks like it's not over yet. According to this article - VCs are advising their portfolio startups to postpone their IPO plans until the interest rates stabilize, but really a) Recent IPOs by Instacart and ARM were pretty low energy, and b) They want rates to drop, not stabilize. It's all about fund returns.
5. AI 1/2: Cynically, big tech companies are trying to moat out and win the AI space via lobbying and regulatory capture.
6. AI 2/2: According to this article and the full slideshow from Battery Ventures, despite the tech-spend turndown, 50% of enterprise buyers are expecting to increase their AI spending in the next 6 months, and 79% plan to deploy generative AI in the next year.
7. PRODUCT MANAGEMENT: Requires outstanding leadership - here are interviews with the Head of Growth at Reddit and the Head of Product at Twitter (pre "X") on creating a good vision and strategy, but quality Product Discovery is the hidden skill. This article leverages Slack and Dropbox examples, highlighting the importance of understanding market gaps and user needs with various techniques, such as reverse discovery, continuous discovery frameworks, and competitor analysis sprints, that can transform product leadership.
8. BENCHMARKS: Check this fun little Product Benchmarks calculator from OpenView (referenced in #2 above) that you can use to see how you compare to the 1,000+ B2B SaaS companies surveyed in our 2023 Product Benchmarks.
9. COLD OUTREACH: Cold email is still a go-to modern-day sales tool. Predictable Revenue has a PowerPoint deck for four pillars constituting a quality sales-based email campaign. Here is a 3-step guide to getting noticed by email, and finally, check out this "How to automate cold outreach motion" cheat sheet by Lucas Perret; it includes triggers and prompts.
10. CASE STUDY: The never-ending quest to create the perfect homepage. While there's no such thing as a "perfect homepage," there are certainly best practices you can follow - this article breaks it all down.
POD OF THE WEEK: Speaking of regulatory capture (#5 above), this is a super fun talk from the All In Summit (of All In Podcast fame) by Bill Gurley (of SuperPumped fame) about how regulation favors incumbents.