Steve Blank

MARCH 18, 2011

The signals are loud and clear : seed and late stage valuations are getting frothy and wacky, and hiring talent in Silicon Valley is the toughest it has been since the dot.com bubble. VC’s worked with entrepreneurs to build profitable and scalable businesses, with increasing revenue and consistent profitability – quarter after quarter.

Internet 334

Internet IPO Silicon Valley Agile 334

Cracking the Code

MARCH 12, 2010

Given the predictability of SaaS GAAP revenues on a quarterly basis, the fact that the 08/09 projections were unchanged is not a surprise. Given that the revenues are not growing very fast, this means that most of the companies have reduced their sales force and focused on productivity improvement. SaaS 13 Index Valuation.

Software Review 63

Software Review Technical Review Cloud Forecast 63

David Teten

SEPTEMBER 23, 2017

Close to 80% responded that manual processes, such as tracking down support, preparing reports and pulling data from different sources, are the biggest pain points they face in the valuation process. Kushim , Totem , and VisibleVC focus on serving this need among VCs. This information is used to automate screening during origination.

Private Equity 60

Private Equity Venture Capital Equity Technical Review 60

Both Sides of the Table

JULY 1, 2015

Startup companies continue to grow at unprecedented rates, raise enormous amounts of venture capital and achieve valuations that imply that they will continue to grow rapidly for the foreseeable future. I’m not saying you shouldn’t grow engineering or do PR. But as with any sales advice, revenue diversity matters.

Balance Sheet 150

Balance Sheet eCommerce Venture Capital Acquisition 150

Hearpreneur

JANUARY 20, 2021

Specifically, here is what we’re planning to work on: Quadruple our gross revenue and total cases/consultations. Add an income stream (new area of practice) that will be diversifying our business’ revenue. In 2021, my business goals have been reinvented and pushed to be more competitive than we’ve ever been. Photo Credit: Mark Lizada.

Entrepreneur 118

Entrepreneur Mobile Valuation Global 118

Cracking the Code

DECEMBER 1, 2009

Detailed SaaS Spreadsheet (Valuation and CAC benchmark). SaaS 13 Index Valuation. Impact of the recession on SaaS Sales&Marketing pr. The recession created opportunities! S&M productivity (CAC ratio) for the SaaS 13 Index. Note: high CAC ratio means high productiviy (see blog post for definition). My Investments.

Software Review 48

Software Review Technical Review Cloud Europe 48

www.inc.com

SEPTEMBER 24, 2011

But with the help of Grahams company, which specializes in creating tech systems for start-ups, Jumpstart grew to more than $50 million in revenue--enough to make it an attractive acquisition for media conglomerate Hachette Filipacchi. Arizona Bay has also blended equity payments with revenue-sharing deals. Graham liked the idea.

Arizona 40

Arizona Equity Iowa Venture Capital 40

Cracking the Code

OCTOBER 9, 2009

This strong recovery has highlighted the resiliency of the recurring revenue model in a downturn as well as the stength of the shift to soaftware-as-a-service and cloud computing. In other words, how much of the decline in revenue growth is due to signing up fewer customer vs lower revenues from each new customer. anecdotes. (13).

Software Review 48

Software Review Technical Review Cloud Europe 48

Both Sides of the Table

SEPTEMBER 28, 2013

In the startup journey if you have success in your early product launches, fund raising and PR you’re likely to get “inbound interest” from likely acquirers. Sure, our revenue is growing, but is that enough to raise an internal round? Dilution / valuation. ” “Buy a house? Are you kidding me?

Startup 417

Startup Dilution San Diego Stock Options 417

Cracking the Code

NOVEMBER 13, 2008

The fact that SaaS valuations are being more affected by the downturn than the Nasdaq can be surprising given the supposed resiliency of the SaaS model (recurring revenues) but it translates the public investors belief that SMB software spend is going to be hit very hard by this recession. SaaS 13 Index Valuation. anecdotes. (13).

Software Review 48

Software Review Technical Review Valuation Portfolio 48

Cracking the Code

NOVEMBER 10, 2009

It is intriguing to see the M&A dynamics in the space, highlighting the interest of tech companies for recurring revenue streams - even SAP announced in their analyst call earlier this month that they were moving from perpertual licenses to five year term licences. Detailed SaaS Spreadsheet (Valuation and CAC benchmark).

Software Review 48

Software Review Technical Review IPO Cloud 48

Agile VC

JANUARY 21, 2015

Not every round of funding is closed at a “monster” valuation. But during the year 2000, we went through three different CEOs, fraud nearly killed the company, our revenue was negligible and unproven, and at our worst point, the company was burning well over $10 million a month — A MONTH! Communicating with Your Team.

Cofounder 188

Cofounder Seed Stage Employee PR 188

Cracking the Code

NOVEMBER 10, 2009

Cloud accounting is all about matching revenue and costs to consumption…well, except for professional services! Detailed SaaS Spreadsheet (Valuation and CAC benchmark). SaaS 13 Index Valuation. Impact of the recession on SaaS Sales&Marketing pr. Support, support, support! Mind the GAAP! My Investments.

Software Review 48

Software Review Cloud Technical Review Sales Cycle 48

Hearpreneur

JANUARY 13, 2021

Specifically, here is what we’re planning to work on: Quadruple our gross revenue and total cases/consultations. Add an income stream (new area of practice) that will be diversifying our business’ revenue. In 2021, my business goals have been reinvented and pushed to be more competitive than we’ve ever been. Photo Credit: Mark Lizada.

Entrepreneur 62

Entrepreneur Mobile Valuation Global 62

Cracking the Code

JANUARY 22, 2009

While it may make sense to offer very slight adjustments for favorable payment terms and one time revenue, net additions to MRR should dominate the sales rep’s thoughts. 1 of MRR generates $12 of annual revenue, so $1 commission equals 1/12=8.3% of Year One Revenue Sounds high, but is that considered a reasonable package?

Software Review 91

Software Review Clawback Sales Salary 91

crowdSPRING Blog

NOVEMBER 30, 2012

… Checking In on Foursquare’s Valuation – [link]. Red All Over: Newspaper Revenues Fall In Q3 – [link]. Just got acquired? 10 adjustments to make when working for a Big Co. – [link]. The danger of waiting to long to find a business model? Who says startups are easy | Om Malik – [link].

Social Media 100

Social Media Small Business Central African Republic Design 100

Cracking the Code

FEBRUARY 25, 2008

As I was building the spreadsheet, I also included the revenue multiples for this set of companies, both for the trailing 12-month (TTM) and the forward 12-month (FTM). Detailed SaaS Spreadsheet (Valuation and CAC benchmark). SaaS 13 Index Valuation. Impact of the recession on SaaS Sales&Marketing pr. My Investments.

Software Review 48

Software Review Technical Review Europe Venture Capital 48

View from Seed

JANUARY 20, 2015

Not every round of funding is closed at a “monster” valuation. But during the year 2000, we went through three different CEOs, fraud nearly killed the company, our revenue was negligible and unproven, and at our worst point, the company was burning well over $10 million a month — A MONTH! Communicating with Your Team.

Cofounder 120

Cofounder Startup Employee PR 120

Agile VC

JANUARY 21, 2015

Not every round of funding is closed at a “monster” valuation. But during the year 2000, we went through three different CEOs, fraud nearly killed the company, our revenue was negligible and unproven, and at our worst point, the company was burning well over $10 million a month — A MONTH! Communicating with Your Team.

Cofounder 100

Cofounder Seed Stage Employee PR 100

Eric Friedman

JUNE 11, 2019

Partnership Forcing Functions can be tricky because they typically don’t involve revenue, which drives most business decisions, but there are other reasons to do the deal. Here are a few I have seen work: PR Opportunity – for the LargeCo. Typically a startup wants a POC with a LargeCo. and they move at a glacial pace.

Term Sheet 68

Term Sheet Stock Options Early Stage Agile 68

Cracking the Code

DECEMBER 16, 2006

however, public SaaS companies like Concur, Saba, Taleo, LivePerson and Ultimate are growing 50-100% per year and trading at an average 5x trailing revenue multiples (I excluded salesforce leading the pack with 9x!) whereas traditional software companies of this size have a growth rate of less than 10% and revenue multiples of 2-2.5x.

Software Review 48

Software Review Silicon Valley Technical Review Software 48

Cracking the Code

JANUARY 28, 2008

Eloqua is bringing this revolution to the B2B marketers by providing on-demand applications and best-practice expertise for B2B marketers to execute, automate and measure effective marketing programs that drive revenue. Detailed SaaS Spreadsheet (Valuation and CAC benchmark). SaaS 13 Index Valuation. My Investments. anecdotes.

Software Review 48

Software Review Technical Review Los Angeles Europe 48

www.forentrepreneurs.com

FEBRUARY 2, 2010

Far more common is a need to acquire customers through a series of steps like SEO, SEM, PR, Social Marketing, direct sales, channel sales, etc. It appears that LTV should be about 3 x CAC for a viable SaaS or other form of recurring revenue model. For more on the topic of Viral Growth, refer to my blog post on that topic here.)

Acquisition 103

Acquisition Cost Customer Entrepreneur 103

trada.com

APRIL 7, 2010

Once you’re doing this you’re not optimizing your own strategy anymore, you’re optimizing against the market’s current valuation of the strategies it sees. You get glimpses into their strategy and tactics. And you start playing game theory with them. Once you’ve carved out your own path, scale, scale, scale.

Stealth 40

Stealth PPC Advertising Conversion 40

Both Sides of the Table

FEBRUARY 25, 2010

million at a $15 million pre-money valuation. Morgan Stanley had proposed a higher valuation to let them in. If it’s a biz deal you might care about IP protection, revenue share, investment commitments to joint marketing – whatever. million at a $15 million pre-money valuation. We ended up agreeing a term sheet for $16.5

Technical Review 301

Technical Review Term Sheet Due Diligence Venture Capital 301

crowdSPRING Blog

MAY 8, 2015

What is the ideal size and make-up of a team for a pre-revenue SaaS startup? The Angel VC: Key Revenue Metrics for SaaS companies – buff.ly/1INSu29. Valuation As A Scorecard – buff.ly/1F0CUyC. Steve Blank On Why Most Startups Fail, And It’s Got Nothing To Do With Technology – buff.ly/1IhCLrF. 1P7gNaZ.

Small Business 48

Small Business Design Social Media Startup 48

Transformify

AUGUST 27, 2017

Your team is directly correlated with the valuation of your startup. A startup needs marketing, business development, branding, PR, IT, and a myriad of other experts as there is no single answer to the question ‘’How to start a business and do it right?’’ Team comes first. The downside?

Hiring 64

Hiring Software Review Burn Rate Startup 64

www.readwriteweb.com

OCTOBER 18, 2010

These are areas that may be gaps in the portfolio of large companies, and are perfect for M&A deals in three to five years after building enough validation and $10-$20 million in revenue. Raymond has built a nice business through efficient distribution deals and will do about $250,000 in revenue this year. This is her core market.

Marketing 52

Marketing Bootstrapping Incubator Angel Investor 52

www.readwriteweb.com

OCTOBER 18, 2010

These are areas that may be gaps in the portfolio of large companies, and are perfect for M&A deals in three to five years after building enough validation and $10-$20 million in revenue. Raymond has built a nice business through efficient distribution deals and will do about $250,000 in revenue this year. This is her core market.

Marketing 52

Marketing Bootstrapping Incubator Angel Investor 52

www.paulgraham.com

OCTOBER 23, 2010

The investors backed down; wedid another round of funding at a reasonable valuation; the giantcompany finally gave us a piece of paper saying they didnt own oursoftware; and six months later we were bought by Yahoo for muchmore than the earlier acquirer had agreed to pay. A rich companyis one with large revenues.

Startup 105

Startup Cofounder Software Stock 105

Scalable Startup

JULY 19, 2011

Great PR and finance firms, but not many startups. If you seek maximum scalability, the best capital providers, the best people, the highest valuations, you gotta be in Cali. If you plop your company here, great things could happen. Houses were cheaper, you couldn’t get good engineers, etc. That has all changed.

California 20

California Southern California San Francisco Silicon Valley 20

betashop.com

OCTOBER 8, 2012

From the start we said that we would never make a decision as to what features to build or what products to sell based on revenue alone, rather we would focus on things that make our customers smile and by doing so lots and lots of revenue will fall out over time. Never, ever, choose your investors based on valuation.

Technical Review 108

Technical Review Technology Software Review Valuation 108

Cracking the Code

MAY 25, 2010

A few highlights from the different keynotes and speakers On top of Jason, we also had the chance of having many great speakers at the event and here are a few quotes and notes that I have taken during the different keynotes and panels: Joe Payne, CEO of Eloqua moderated the panel on Revenue Performance Management. SaaS 13 Index Valuation.

Software Review 74

Software Review Cloud IPO Jordan 74

crowdSPRING Blog

MAY 4, 2011

Must read article for all startup entrepreneurs about valuation – [link]. agency revenues – [link]. What It’s Like To Be An Entrepreneur – Mark Achler – [link]. 4 Ways to Make Social Technology Work For Your Biz – [link]. Seven lessons to learn from Amazon’s outage – [link]. Traditional?

Social Media 92

Social Media Small Business Design Media 92

Cracking the Code

MARCH 10, 2008

I found this approach interesting, but it seems to me that gross margin is a more relevant benchmark than revenues, given that the GM of saas companies varies by type of application and size of the company (for example NetSuite went from about 50% GM three years ago to close to 70% today).

Sales 79

Sales Software Review Marketing Technical Review 79

This is going to be BIG.

SEPTEMBER 7, 2012

In the late 90's, it wasn't surprising that companies with no revenue that were funded at 100 million dollar valuations didn't survive. I think I'm terrific at helping early stage teams by rolling up my sleeves and doing what's necessary--getting them hires, PR, product strategy help to find that market fit. Down from what?

Later Stage 99

Later Stage Down Round Pre-Money Valuation Early Stage 99

Cracking the Code

OCTOBER 10, 2008

Be prepared to cross the desert - SaaS requires R&D and sales expense up front for a multi-year stream of revenue, so it demands enough investment capital to fund 4+ years of runway. Farming is also often overlooked, but can help grow customer accounts and revenues from 30% upwards (if successful). Great list! Philippe Botteri.

Software Review 48

Software Review North America Europe Metrics 48