Dear SaaStr: We Don’t Need It. Should We Still Go After Venture Capital, and When?
Dear SaaStr: We Don’t Need It. Should We Go After Venture Capital, and When? There are only two reasons to raise Venture Capital: You need it. If the only way you can get to the next level is to raise capital, then do it. I needed to for both my start-ups, up to...
Dear SaaStr: Is It Ridiculous To Call Yourself the CEO When Your Startup is Tiny?
Dear SaaStr: Is It Ridiculous To Call Yourself the CEO When Your Startup is Tiny? I used to feel that way, at least a bit. I used to look at tiny little startups and wince when a founder went around talking about himself as “CEO”. But then I had to learn how to Sell...
Dear SaaStr: What Are The Biggest Problems You Face as a Startup Founder?
Dear SaaStr: What Are The Biggest Problems You Face as a Startup Founder? The list of problems is endless (this is one of the hardest parts of the job), but let me try to order a few of the biggest challenges roughly based on stage: Pre-Revenue: Finding a Truly Great...
Dear SaaStr: What is The Biggest Difference Between Running a 10 Person Startup and a 100 Person Startup?
Dear SaaStr: What is The Biggest Difference Between Running a 10 Person Startup and a 100 Person Startup? The biggest structural difference is you have to hire all the VPs by employee 50–100. You won’t be able to scale this far without a full management team — VPs of...
Dear SaaStr: What Percentage of Shares Should Be Set Aside for Employee Equity?
Dear SaaStr: What Percentage of Shares Should Be Set Aside for Employee Equity? Nuanced answer: A lot. But, the precise number today doesn’t matter. At a practical level, if you are growing quickly, you’ll typically grant 6-8% a year in additional grants (and...
Dear SaaStr: What Are the Danger Signs a Startup Isn’t Going to Work Out?
Dear SaaStr: What Are the Danger Signs a Startup Isn’t Going to Work Out? Let me share my list. It’s more about things I worry about after investing, as sometimes they’re hard to see before: Founders’ understanding of market doesn’t get deeper. I really...
Dear SaaStr: When Should The CEO Step Away From Sales?
Dear SaaStr: When Should The CEO Step Away From Sales? Never. It’s just, as you scale, what you do in the sales process as CEO evolves and changes. I remember when we closed Groupon as one of our Ten (or so) Largest customers, back in the day. They’d brought us...
Dear SaaStr: How Does a First Time Founder Identify 10x Hires?
Dear SaaStr: How does a First Time Founder Identify 10x Hires? How do you hire a great CTO, a great VP of Product, a great VP of Sales … if you’ve never worked with one? It’s hard. There’s a reason almost every founder you talk to had a...
Dear SaaStr: At What Stage Should the Founders Stop Being Individual Contributors?
Dear SaaStr: At what stage should SaaS founders fully stop being individual contributors? I’ve come up with 2 rough rules here to avoid stalling out: Try to have a complete 1.0 management team by $4m ARR at least. Earlier is better, of course. And try to hire at...
Dear SaaStr: How Do You Price a SaaS Product in a New B2B Market?
Dear SaaStr: How Do You Price a SaaS Product in a New B2B Market? I’ve lived it. It’s not as complicated or as hard as it sounds. The simplest answer is usually to copy the pricing from the closest public company or other break-out leader you can find that is...
5 Top Things to Remember When Starting a Company
My Top 5 Things to Remember When Starting a Company: #1. Fixing the Founding Team is Very, Very Painful. Take the time to get it right. I was unstoppable when I had aligned, great co-founders. I also almost died when I had great — but dis-aligned — co-founders. A...
Dear SaaStr: Who Should I Hire First to Get Customer Success Going?
Dear SaaStr: Who Should I Hire First to Get My Customer Success Function Going? Key criteria for first customer success hire: – smart – truly understands and cares about the problem your product solves– lives and breathes making customers happy Rest,...
Dear SaaStr: What are The Top Challenges of Venture Capital Firms?
Dear SaaStr: What are The Top Challenges of Venture Capital Firms? Generally there are three major challenges. The first one is non-obvious. Challenge #1: Raising Another Fund. While Sequoia, Benchmark, Founders Fund, etc. etc. can all basically raise a new fund in...
Dear SaaStr: What Are The Pros and Cons of a Double Trigger with a 6 Year Vest for Founders of a Startup?
Dear SaaStr: What Are The Pros and Cons of a Double Trigger with a 6 year Vest for Founders of a Startup? I think there are no cons and this is a great idea. First, a 6+ year vesting schedule protects you from the less committed founders. The last thing you want is...
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