the future of B2B SaaS billing
SaaStr Annual is right around the corner, so if you’re going to be there (or the Bay Area in general) give us a shout! Our friends at Element Finance and Chargify will be boothing it up and would love to say hi.
Chargify actually has a few discounted tickets left, so if you’ve yet to buy yours, feel free to use that link. And if you want a sneak peak at the future SaaS billing, check out their live streamed event coming up March 5th. They’re unveiling a game changing new product with an expert panel of the best in SaaS pricing… we’re all excited to see what they’ve got.
Onto this week’s best practices.
🍺 Beer measurement comes down to 3 things: color, bitterness, and ABV. RevOps measurement is a bit more nuanced, but Price Intelligently’s Patrick Campbell and Chargify’s Michael Klett manage to cover both! In their latest episode of RevOps and Hops the two chat with former AdEspresso founder Armando Biondi about how RevOps measurement changes as your company scales. In nearly all cases, growth will slow over time because as absolute revenue numbers increase, relative percentages diminish. And that’s okay. Fighting to keep unsustainable growth will result in higher churn and wasted dollars. Another reason for inevitably reduced growth is that what works in GTM also changes as you scale, so you can prepare by testing and debating your future strategy now.
⌛ No one likes unnecessary hassle, but it's especially important to conserve your time and energy as a bootstrapping founder. We thought these rules to run a software startup with minimum hassle were spot on. Full disclosure, the author admits he’s broken almost all of these rules, but better to learn from someone else's mistakes then make your own! Avoiding steep discounts (and over-discounting in general) is a great rule to remember, as well as outsourcing more complex functions like billing. You may think you can handle these functions on your own, but trust us, DIYing it will waste valuable time and you’ll never do it as well as the pros.
🏀 We all know the makeup of a team is critical to your success, but it goes far beyond just having the smartest people in the room. When building a team from the ground up, start with people who can complement your weaknesses. Every Shaq needs their Kobe. Another overlooked quality in hiring is passion. This doesn’t mean they have to clock 80 hour weeks, but you want someone who truly believes in your company’s mission and isn’t just there to collect a paycheck. When your employees do start, it’s beneficial to have them understand what the rest of the team does and where they fit in because in the beginning days, everyone should really be “making or selling.”
🥧 With the recent onset of unicorn IPO’s, the classic VC model of burning cash quickly in hopes of rapid growth has hit an all-time high in popularity. If you do decide to pursue the burn, it’s important to keep a close eye on ROI—go too spend crazy and you might not have runway to get to your next round. So even though you’ll probably have the funds to build a robust team after a raise, it makes most sense to play it safe and take your time when hiring. We’ve seen success with remote development teams in locations where your dollars go further. You can also use equity as compensation to save cash today, just remember that giving everyone a slice of the pie means less for you!
🐟 Have you ever tried completely turning off paid ads? We bet you’d lose less business than you think—paid search can cannibalize organic users who would have converted regardless. Former Uber Performance Marketer Kevin Frisch found out he was getting ripped off on SEM for a much more serious offense: attribution fraud. Many of the ad networks Uber used included app placements which took credit for conversions, but when an app with 2,000 MAUs was claiming 20,000 conversions in one month, Frisch knew something was fishy. After cutting 10% of their spend to test his hypothesis, he saw zero change in total conversions. They ultimately decided to bin ⅔ of their 150m ad spend, and guess what? Little to no change in new subscriptions.