Kyle Poyar’s Post

𝟵𝟭% of B2B SaaS companies are NOT tracking this one critical metric. Unfortunately, not knowing this Key Performance Indicator leads to failure. 😖 Which happens to most software companies, sadly. What’s that key metric? 𝗟𝗧𝗩:𝗖𝗔𝗖 That stands for the LIFETIME VALUE of your customers against your CUSTOMER ACQUISITION COST. There are two reasons why SaaS founders and leaders don't track this: 1st, they don't know how important it is. So I'm here to tell you: it's absolutely critical. This number shows you how much money you'll earn from a customer vs the amount of money you spent to get them as a customer. If you're spending too much on sales & marketing, but not getting enough back in return, You'll fail. Or if you're getting a lot back for little spending, you know you can spend more to make even greater amounts of revenue. 2nd, they don't know how to track it. Fortunately, while building my SaaS startups, I developed a really helpful SaaS Sales Scorecard. It tracks your LTV:CAC and several other crucial KPIs for you. Just plug in your numbers, And POOF! Complete with pretty charts to show you visually how things are going. Because if you're not measuring it, you can't maximize it! I'm giving this scorecard to anyone who requests it, free of charge. Just type "SaaS Scorecard" below in the discussion and I'll send it over. #SaaS #metrics #mattschats

The Startup Pricing Journey If pricing is as hard as advertised and even the world’s leading companies wait for years to circle back on pricing, why should early-stage companies care? A pragmatist might argue that after wrapping up the initial pricing work, it should be placed on the back burner in order to free up capacity to tackle the most pressing needs of the business. However, by applying a relatively straightforward ROI lens to the various levers a business might tweak in pursuit of growth, it becomes clear that one of the most efficient means for incrementally driving revenue growth is indeed by focusing on pricing. There are clearly many other ways for companies to drive value. However, most of these initiatives cost significant investments in both capital and time: 🔹 Better products: Creating and improving products that provide increasing value to customers requires talented product managers and engineering teams capable of executing on that vision. 🔹 New logos: Exceeding revenue goals requires experienced sales leaders and account executives to chase down new accounts, while also selling larger deals. 🔹 Strong renewals: Generating more net new opportunities is usually only one part of the puzzle, and all great businesses are driven by a mix of recurring revenues, upsells, and net new business. In order to keep churn low and upsells high, a highly responsive Customer Success organization is needed. 🔹 Demand generation: A marketing organization that not only builds a brand that stands out from the crowd of noisy competitors, but also informs motivated customers about your solution, while generating robust leads to feed the top of funnel, is required. 🔹 Partnerships: Creating a supplemental engine for growth requires finding and establishing new channel and service partners, while also enabling them. Ultimately, pricing is comparatively cheap. Best-in-class teams are usually able to pair one to two dedicated hires with analytical support (either from Finance or Engineering). While this must also be complemented by a culture of leadership buy-in and cross-discipline engagement and support, when compared with other strategic programs the necessary inputs seem quite manageable. When we looked at the results, 32% revenue uplift on average, the math starts to seem quite compelling. Because of the cross-functional nature of pricing, the output of pricing improvements is not mutually exclusive of these other initiatives. The pricing changes Company A made helped to inform other initiatives such as creating better products, strengthening renewals, and supporting demand generation with a new product and pricing scheme that met more customer needs. 👉Subscribe for more insights https://lnkd.in/d94JgWBU Source Bessemer Venture Partners / Simon Kucher & Partners #fintech #pricing Prasanna Marcel Richard Panagiotis Tony Efi Nicolas Arjun Dr Ritesh

Small B2B SaaS companies face dual challenges: size perceptions and acquisition fears. But with the right approach, a small startup can turn these challenges into opportunities. Consider these key points, and then check out the full article from our Founder Seth Temko: 🤝 Build Trust: Regular, detailed communications about your vision and updates. 🙌 Show Reliability: Highlight customer support and service uptime stats. 📣 Address Acquisition Concerns: Clearly communicate your strategic independence. 💫 By fostering a community around innovation and showcasing awards, you can build a loyal user base and enhance trust. 🔥 Check out the full article here 👇 https://rdar.li/43z8o9r #SaaS #B2B #Tech #SmallBusiness #Innovation

𝐓𝐡𝐞 𝟓 𝐒𝐚𝐚𝐒 𝐌𝐞𝐭𝐫𝐢𝐜𝐬 𝐓𝐡𝐚𝐭 𝐅𝐮𝐞𝐥 𝐘𝐨𝐮𝐫 𝐒𝐭𝐚𝐫𝐭𝐮𝐩'𝐬 𝐆𝐫𝐨𝐰𝐭𝐡 🚀 Scaling a SaaS startup is no easy feat, but tracking the right metrics can make all the difference. 📊 These five key performance indicators (KPIs) are your compass to sustainable growth and profitability: ✅ 𝐌𝐨𝐧𝐭𝐡𝐥𝐲 𝐑𝐞𝐜𝐮𝐫𝐫𝐢𝐧𝐠 𝐑𝐞𝐯𝐞𝐧𝐮𝐞 (𝐌𝐑𝐑): Your MRR is the lifeblood of your SaaS business. 💰 It represents the predictable, recurring revenue you can count on each month. Consistent growth in MRR signals that your product is resonating with customers and gaining traction. ✅ 𝐂𝐡𝐮𝐫𝐧 𝐑𝐚𝐭𝐞: Losing customers? That’s churn—and it’s your worst enemy. 🚨 A high churn rate means your customers aren’t sticking around, impacting both revenue and growth. Focus on retention strategies, such as improving your product’s value and providing exceptional support, to keep churn in check. ✅ 𝐂𝐮𝐬𝐭𝐨𝐦𝐞𝐫 𝐀𝐜𝐪𝐮𝐢𝐬𝐢𝐭𝐢𝐨𝐧 𝐂𝐨𝐬𝐭 (𝐂𝐀𝐂): How much are you spending to acquire a new customer? CAC measures the efficiency of your sales and marketing efforts. 🛠️ Lowering your CAC while maintaining quality acquisition channels ensures that your growth is both scalable and profitable. ✅ 𝐂𝐮𝐬𝐭𝐨𝐦𝐞𝐫 𝐋𝐢𝐟𝐞𝐭𝐢𝐦𝐞 𝐕𝐚𝐥𝐮𝐞 (𝐂𝐋𝐕): CLV helps you understand the total revenue a customer will bring throughout their relationship with your business. 💎 The goal? Increase CLV through upselling, cross-selling, and boosting retention, so you can maximize the return on your CAC. ✅ 𝐍𝐞𝐭 𝐏𝐫𝐨𝐦𝐨𝐭𝐞𝐫 𝐒𝐜𝐨𝐫𝐞 (𝐍𝐏𝐒): Are your customers satisfied enough to recommend your product? An exceptional NPS indicates high customer loyalty and a strong brand reputation. 🌟 Use feedback from NPS surveys to refine your product and deliver experiences that delight your customers. Tracking these metrics isn’t just about numbers—it’s about unlocking insights to make data-driven decisions. Understanding and optimizing these KPIs will help you scale faster, retain customers longer, and drive higher profitability. 👉 Ready to supercharge your SaaS growth? Start by mastering these metrics today! 🔖 🔖 #𝐒𝐚𝐚𝐒𝐃𝐞𝐯𝐞𝐥𝐨𝐩𝐦𝐞𝐧𝐭 #𝐒𝐭𝐚𝐫𝐭𝐮𝐩𝐌𝐞𝐭𝐫𝐢𝐜𝐬 #𝐃𝐚𝐭𝐚𝐃𝐫𝐢𝐯𝐞𝐧 #𝐓𝐞𝐜𝐡𝐒𝐮𝐜𝐜𝐞𝐬𝐬 #𝐁𝐮𝐬𝐢𝐧𝐞𝐬𝐬𝐆𝐫𝐨𝐰𝐭𝐡

Over 95% of B2B SaaS CEOs who reach out to us have hit a plateau with their product-led growth motion. This happens because: 1) They have an unintentional model They decide on a free trial/ freemium because their competitors do it. But there are multiple product-specific, company-specific, and market-specific factors you need to take into consideration. In short, you need a structured decision-making framework and you can't rely solely on your gut. 2) They approach PLG from the surface level Do you think you can crush a marathon simply by buying expensive shoes and not focusing on diet and training? Most companies have a similar approach when it comes to PLG. Slapping a free trial/ freemium without building the capabilities that support your product-led motion is a recipe for disaster. 3) They're solving the wrong problem. I've seen hundreds of such scenarios. For instance, they spend months optimizing their onboarding flow to fix their free-paid conversion rates. But after 1 or 2 quarters, they realize that the problem is with their offer. Most companies don’t have that much leeway. If you're struggling with choosing the right model, I've created "The Bedrock Framework" to help you solve this problem. Just leave a comment and I'll send it over!

In the SaaS sector, businesses often find themselves impoverished by growth. The term 'Growth Trap' aptly describes situations where high revenue growth coincides with severe profitability issues. Contrarily, reality often demonstrates that faster growth correlates with greater losses. This cycle persists until the growth capital is exhausted, typically causing a stall in revenue growth as well. It is crucial to recognize that losses in SaaS businesses are not inevitable. Rather, they are an acceptable buffer in the early stages of this business model. SaaS entrepreneurs should strive to achieve breakeven as quickly as possible, avoiding an over-reliance on acquiring new customers. Simply spending money to boost revenue is straightforward, but it’s akin to conducting business recklessly, as per layman's terms. To navigate away from this precarious strategy, it’s vital for companies to understand and optimize financial metrics. T = CAC / (ARR – ACS) For instance, achieving breakeven more rapidly requires a focused optimization of the Average Recurring Revenue (ARR), Customer Acquisition Cost (CAC), and Average Recurring Cost of Service (ACS). Understanding these figures helps in making informed decisions that align with long-term financial health rather than just short-term growth. For example, if ARR = 1000, ACS = 500, and CAC = 1500, the breakeven time is: T = 1500 / (1000 - 500) = 3 years. Considering churn extends the breakeven period,. To reduce the breakeven time, the focus must be on optimizing ARR, CAC, and ACS. Similarly, the profit formula without considering churn is: P = (ARR – ACS) x C(t) – CAC x Cnew(t) Where C represents the total customer count at a given time, C_{new} is the number of newly acquired customers, and P denotes profit. At the breakeven point, P should be zero; profit accrues thereafter. These formulas assume no churn, which is unrealistic. Accounting for churn decreases ARR and the customer count C. Moreover, the relationship between the cost of customer acquisition, CAC, and the customer count, C, suggests that acquiring more customers requires higher expenses. These interrelated dynamics extend the time to breakeven and reduce profits, thus exacerbating losses. Therefore, core business strategies must transition from excessive customer acquisition to focusing on profit generation, such as by lowering CAC and increasing retention. #SaaS #ecommerce #Growth

This is crazy ▶ 90% of SaaS product features never give you positive ROI. Most founders? Rush to build them anyway... 🤦♂️ Smart founders avoid this "feature trap"... they ask this critical question you're probably missing... Whats wild is that they know something other founds don't... ... Every new feature actually DESTROYS value before creating it. 😳 Here's what I mean... Think about all of the new features you want to create. You're probably thinking "These will be great! Our customers will love them!" But here's what most founders miss: ▶ 100% of those will cost you time, money, and resources to build. ▶ 100% of them will require ongoing maintenance. ▶ 90% of those will make your product more confusing or "heavy" (for your dev team and customers) ▶ 90% of them will impact customer support ▶ and 90% of them will NEVER bring value to your customers. And that’s a huge realization. It’s not that your features were built badly… … From the 100’s of B2B SaaS companies that I’ve seen in our programs… most features are actually built really well. It’s because most teams completely miss asking this critical question BEFORE they build the feature in the first place: "Are we deepening value for existing customers, or expanding to new markets?" Your answer changes everything about how you validate, test, and roll out that feature. Most of the time? Founders build new features that don’t deepen value for existing customers. That cool new feature you want to build… Doesn't deepen value for your ICP. It actually helps you expanding to new markets. For your initial customer base this means: ❌ Things just got more complex. ❌ More cumbersome. ❌ More unusable. And your product... creates less targeted value. That’s kills growth. Get this wrong and you're waste time, money, and energy… and stall growth. Get it right… … and you start building deep value for customers with the new features you build. This helps you scale faster. Reduce churn. Expand MRR. Ultimately... it’s more growth for your business. 🚀 ♻️ Repost this to help your network grow. And follow Johnny Page more.

The best product roadmaps don't chase feature parity or customer wishlists - they ruthlessly focus on deepening core value for existing customers 🎯 We see this pattern consistently across successful B2B SaaS companies: less is often more when it comes to features.💡 ⚡Johnny Page breaks down the exact question founders should be asking themselves before that 'must-have feature' makes it onto their roadmap:

2024 is coming to a close … How does your SaaS startup measure up? Our free interactive Benchmark Report is an easy way to compare your startup’s performance across six key metrics. 💪 Simply input your data into the calculator and instantly see how you stack up against competitors in the B2B SaaS space. Adjust by industry, company age, or calendar year to get a clear vision of your company’s financial positioning. Get started here 👇 https://lnkd.in/e-4N7nW5 

📈 Want to track your SaaS growth metrics more accurately? Here are 5 essential metrics every startup founder should be measuring. #SaaSGrowth #MetricsTracking 🚀 As a LinkedIn marketing and content creation expert, I understand the importance of tracking key metrics to drive business growth. When it comes to SaaS startups, measuring the right metrics is crucial for success. Here are 5 essential metrics that every startup founder should be keeping an eye on: 1️⃣ Monthly Recurring Revenue (MRR): This metric helps you understand your revenue growth and predict future revenue streams. 2️⃣ Customer Acquisition Cost (CAC): Knowing how much it costs to acquire a new customer is vital for optimizing your marketing and sales strategies. 3️⃣ Churn Rate: Keeping track of customer churn allows you to identify areas for improvement and retain valuable customers. 4️⃣ Customer Lifetime Value (CLTV): CLTV helps you determine the long-term value of a customer and make informed decisions about customer retention and acquisition. 5️⃣ Net Promoter Score (NPS): NPS measures customer satisfaction and loyalty, providing insights into your product-market fit. By focusing on these metrics, you can make data-driven decisions and drive your SaaS growth to new heights. Start tracking today! 💪📊 #SaaSGrowth #MetricsTracking