Dear SaaStr: What Was Your Biggest Early Days Mistake In Your Startups? Boy it’s tough to pick just one mistake. But I’d have to say in both my startups, the biggest mistake was not taking the time in the beginning to get the founding team right. This is tough. You...
Dear SaaStr: What happens to employees after your startup gets acquired? It varies — a lot. But as a rule: Top engineers will all be given retention packages, extra money / RSUs / options designed to keep them for 2-4 years. All engineers and product people...
Dear SaaStr: How Do I Convince My Customers with Monthly plans to Upgrade to Annual Plans? My advice: Don’t. It’s too many calories expended for not enough benefit. Let me explain what I mean … Large customers only pay via invoices, especially for any deal of any...
Dear SaaStr: What Are The Most “Evil” Things That VCs Do? I’ve been on every side of the table, and had challenging experiences with my investors. I think what founders get wrong is not understanding incentives. VCs really do want you to be a big success....
Dear SaaStr: Does Anyone Regret Being an Entrepreneur? No, but there are … laments. The thing is, successful entrepreneurs generally speaking, can only do that — be successful entrepreneurs. Why? Why can’t they go work for someone else, collect a huge paycheck,...
Dear SaaStr: Should I Go Into SaaS Sales? If you aren’t sure you want to go into sales — don’t do it. Maybe in 2021, when many SaaS leaders were growing at simply unprecedented rates, could succeed in sales if you weren’t sure you wanted to sell. Not today. A...
Dear SaaStr: Why Would I Start a Startup if I Only Have a 5% Chance of Succeeding? Don’t do it. If you only see a 5% chance of succeeding, don’t do it. With both my start-ups (maybe three, if you count SaaStr and SaaStr Fund) … I was 100% sure we’d succeed. And I was...
Dear SaaStr: Do You Have To Be Rich To Join a VC Firm As a VC? No, you do not. This is a common misunderstanding. It may even be a negative to be truly rich when you join a VC firm. First, you do have to invest a lot of your own money to be a true partner into the...
Dear SaaStr: How Long Should a Free Trial Be for SaaS Products? It doesn’t really matter. What I mean is, this is one of those things in SaaS that is over-analyzed, as if it will make a magical difference. The sales team will like a shorter period, often, to help them...
Dear SaaStr: What Is A Good Demo Conversion Rate for a SaaS Startup? 10%-20%. If fewer than 8%-10% or so of your demos convert to paid customers, you’ll start to burn out your sales team. Because they generally need to close 10-15 deals a month to eat (more for SMB,...
Dear SaaStr: Should SaaS Pricing Be Adjusted for Different Geographical Markets? Your public pricing? Usually the answer is — Not Today. First, it’s complex to manage. Second, your users will see the pricing is “cheaper” somewhere else and get mad. Third, it’s...
Dear SaaStr: What Advice Do You Have For a First-Time VC? My advice is hard learned, and pretty contrary to what you’ll be told. YMMV. So many mistakes you'll look back in VC But the #1 you'll probably regret was letting those founders leave the room,...
Dear SaaStr: What Are The Top 10 Things to Know Before Starting a SaaS Company? We’ve discussed most before individually, but let me throw ’em together: It may well take 24 months to get to true product-market fit and Initial Traction. If you budget any less,...
Dear SaaStr: Does Everyone Lose Most Of Their Friends on The Entrepreneurial Journey? You will lose friends on many levels if you build a successful start-up. First, if you co-found a company with friends, it’s likely one of them won’t go the distance. And it’s likely...
Dear SaaStr: What’s the #1 Mistake New Sales Leaders Make? Let me just summarize my #1 observation here: the top mistake first-time sales managers make is recruiting. In that — they can’t do it. It is incredibly hard to figure out how to replicate the magic of...