So with so much change and tumult, how can we get a handle on how SaaS startups are really doing?
Hiring is a great proxy. It cuts through the baloney, the 100x ARR rounds, and the pretending.
And this survey on how we’re all doing in hiring pretty much reflects what I’m seeing in SaaS startups overall:
28% of you are hiring as fast as ever. 43% of you are still hiring, but have slowed the pace. Like Monday and other SaaS and Cloud leaders. And 29% of you aren’t hiring anymore. A hiring freeze (or reduction):
This pretty much ties to what I’m seeing in my own venture portfolio and the startups I’m closest to:
- About 20%-25% are growing faster than ever, or at least faster than earlier in the year. Provided they have the capital, they’re hiring as fast or faster than ever.
- About 20%-25% have seen growth rapidly decelerate vs. 12 months ago. Rapidly. That ties to the 29% of folks not doing any hiring. In my ecosystem, these are a combination of “nice to haves” that are struggling to get budget today and folks that didn’t really iterate their product portfolio or GTM since the start of the year.
- About 40% are in the middle — still growing nicely, but either more slowly than at the start of the year and/or cash constrained. These folks are still hiring, but more slowly than before.
Net net, no doubt it’s tougher times for most than at the start of 2021. But not for everyone. And it’s not that bad. Most of you are still growing nicely — and hiring because of it.
And if you have plenty of runway, but aren’t quite sure what to do in confusing times … well, my recommendation is pretty simple. Spend half of what you book on new hires. E.g., for every $300k in new bookings, spend $150k on new hire salaries. That ensures you keep growing, but that expenses … don’t.
A related post here: