Fresh Insights

Analyses, Musings & Observations

Learnings from a founder that sold to FB

I read “Chaos Monkeys, Obscene Fortune and Random Failure in Silicon Valley.”  The book is a 2015 vintage, but a lot of the lessons and take-aways are relevant today.  It’s a great read that I would highly recommend; key excerpts are below.   FB’s data isn’t that valuable.  “The miserable conclusion was that Facebook, though…
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Growing your SaaS cohorts

Before we get into the meat of this post, first, a quick refresher: a cohort is a group of customers acquired at a particular time; for instance the “January 2018” cohort would be those customers who were acquired in January 2018. One very important measure in SaaS is cohort growth. Often times this is depicted…
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SaaS M&A multiples at ~7.6x

PING is being acquired by Thoma Bravo, which means we have another software M&A comp. Alongside multiples of publicly traded SaaS companies, public SaaS acquisitions are some of the most relevant you can look at for deriving SaaS revenue multiples. These transactions are all cash, the financials are public and audited, and these are all…
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International can unlock SaaS growth

If you’re looking for your next leg of growth, look to international markets. Below are examples of software companies and B2C companies that IPO’d in 2021, where international expansion is a key to future growth. Quotes are taken directly from prospectuses of each company. Samsara. “we have a growing international presence, with approximately 10% of…
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Tech’s recession resilience

That’s an aggressive title for a blog, but the data shows it may be true. We looked at the quarterly revenue growth of 47 tech companies before and after the 2008 recession and remarkably, the sector performed well. Below is the data. Software. Only 4 companies showed real YOY drops during the recession. Calidus Cloud…
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The right way to price SaaS

Price Intelligently put out phenomenal content on how to price your SaaS product. A link to the full report is at the end of this blog and it’s well worth the read. Below are our biggest takeaways. Don’t use competitors’ pricing as your basis. “the biggest downside of competitor based pricing should be obvious. You…
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Founder paydays at IPO

When a startup founder shepherds his company to a successful exit (IPO), what are the paydays like? We dove into major tech IPO’s since 2018 to find out. Note that paydays aren’t necessarily what the founders took home at the IPO (shares are usually subject to a 6 month lockup), rather they’re what the founder…
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Learnings from a SaaS IPO – Hashicorp

Hashicorp is a software company went public in 2021. Below are some of the highlights and learnings from their prospectus. What they do. “Our cloud operating model provides consistent workflows and a standardized approach to automating the critical processes involved in delivering applications in the cloud: infrastructure provisioning, security, networking, and application deployment.” Always remote…
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SaaS M&A multiples in Q2

Software Equity Group is an investment bank that puts out excellent research on SaaS markets. They’re also a great group of bankers. They just released their latest report on Q2. A summary is below but the full report may be found at https://softwareequity.com/research/. SaaS M&A is still healthy, for now. “Overall, the volume of SaaS…
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Learnings from Twitter’s Story

Recently I read Nick Bolton’s book “Hatching Twitter.” It is the story of Twitter and it is fantastic. Below I paraphrased some of my favorite sections, but if there is any book about startups to read, this is it. One of the founders had started Blogger. “Ev explained that Google had approached Ev to buy…
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