Fresh Insights

Analyses, Musings & Observations

SaaS learnings from the latest IPO

Definitive Healthcare just went public. While it may not be a household name in SaaS, there are some learnings from their prospectus. Below we summarize the highlights. It was a 10 year journey. “We were founded in 2011 by our CEO, Jason Krantz. Mr. Krantz founded the company to provide healthcare commercial intelligence that enables…
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How to sell code and dead startups

In 2017, we had a death in the portfolio. Once all the employees left, the only remaining assets were some patents, servers, domains, and a lot of code. Eventually we managed to sell that intellectual property (“IP”). Here is what we learned. Set expectations. The value of IP is a small fraction of what the…
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SaaS and Tech CEO salary data

There is no dataset explicitly outlining salary levels at early stage companies, but we can see salaries from tech companies prior to IPO. The data below shows the salaries of 162 tech company CEO’s at IPO. A few observations stand out:   Some of the best CEO’s take the lowest salaries. For instance, Marc Benioff…
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Learnings selling SaaS to SMB

Fresh Works just filed their prospectus (S1) to go public. Below we summarize the major points which we found interesting for running your SMB focused business. Fresh Works is large and growing, and unprofitable. “total revenue was $172.4 million and $249.7 million in the years ended December 31, 2019 and 2020, respectively, representing a year-over-year…
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Non-recurring revenue in SaaS

While the value of any SaaS business is derived from recurring revenue (ARR), do not forsake non-recurring revenue streams. If you do, you’re ignoring free financing and a way to make the product stickier. Non-recurring revenue streams like onboarding fees and installation fees are a fantastic source of cash. Other non-recurring revenue streams such as…
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Allbirds and Warby Parker’s IPO

Allbirds is about to go public. Their S1 is out (prospectus) and below are some of the key insights on their business. There is a lot to learn from Allbirds about omni-channel and ecommerce sales. Later in this blog, we show insights from Warby Parker’s prospectus. AllBirds insights from prospectus There are 27 stores of…
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negotiating with your VC – part 2

Below is a continuation of a recent blog post about a book called Never Split the Difference by Chris Voss. Chris was one of the premiere FBI Hostage Negotiators in the world, and his tactics could be useful for negotiating with customers, vendors, and of course your VC. The original blog we wrote highlighted some…
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Negotiating against your VC

I just read a book called Never Split the Difference by Chris Voss. Chris was one of the premiere FBI Hostage Negotiators in the world, and his tactics could be useful for negotiating with customers, vendors, and of course your VC. Excerpts from the book are below.   Create warmth by using first names. “I’m…
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Doing omni-channel like Warby Parker

Warby Parker is about to go public via a direct listing. Their S1 is out (prospectus) and below are some of the key insights on their business. The business is very impressive, and there is a lot to learn from Warby about omni-channel and ecommerce sales. It’s been an 11 year journey. “When we launched…
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R&D spend should be 24% of SaaS revenue

Building out, maintaining, and upgrading a technology stack requires a constant commitment to developers and engineers. What is an appropriate level of development or R&D expense for a successful SaaS business? We looked at the last 126 SaaS IPOs at the time of IPO to get a sense for how successful SaaS businesses allocate to…
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