Welcome

Welcome to SaaS Primer.   I am a serial entrepreneur and SaaS investor.  I love to learn and the purpose of this blog is to learn by writing, sharing, and tracking the science of building great SaaS companies.   I have learned via hard work, great colleagues, amazing entrepreneurs, veteran co-investors, and other SaaS practitioners who share their insights generously on the internet.

Popular posts from this blog

Types of Tuck-in Acquisitions

Tuck-ins are classified by their primary purpose or benefit.  In many cases a great acquisition fits multiple classifications. Product Expansion/Improvement We typically target smaller companies with unique technology, core expertise, and some reference customers.   An acquisition that acquires a best in class feature or module addition combined with the key people who built it and some great logos accelerates your product roadmap years with a higher probability of success. The real trade off in this acquisition type is build, partner or buy decision.   When you think of building, remember its not just an MVP version that is required.  You need to build the MVP, get customer feedback, and then sell and implement a group of reference customers.  When you think partner, its not just finding, negotiating, papering and announcing the partnership, it is also educating the partner and then selling and implementing a group of reference partners.  Lastly, the buy decision is not only so
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Great list of B2B GTM metrics

Recently, Martin Casado from Andreessen Horowitz summarized his 11 key GTM metrics for B2B businesses . He starts with CARR (contracted annual recurring revenue) which is the single best metric for the health of the business.  This forward-looking metric leads to recognized recurring revenue and assuming a high retention rate can look like an annuity.  Frequently, the question is "if you sold nothing else this year what would your revenue be?"  One key assumption behind CARR is that the contract lengths should be one year or more in duration.   Many times folks will multiple CMRR (contract monthly recurring revenue) by 12 to obtain a CARR but this can be misleading.   In the B2B enterprise world CARR is predominately used. Martin's 4th and 5th metrics are Net Dollar Retention and Gross Dollar Retention.  Both are important and just getting one or the other of the metrics can obfuscate what is really happening with the business.  The measurement of retention is one o
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Analogies between Tuck-in M&A and portfolio investing returns

In portfolio investing like venture capital or private equity, you are balancing risk versus reward to obtain a portfolio or fund return.   Some deals may be a home run and some may be a single or worse a zero.   Similarly in M&A you are balancing risk versus reward.  Customer or book acquisition where you acquire only the customers that transition to your platform is low risk and accretive but not huge rewards from one transaction.  A tuck-in acquisition that dramatically improves your product or provides a best of breed adjacent solution to cross-sell maybe be higher risk but offers much higher reward. Auren Hoffman wrote a thought-provoking post called M&A is a Power Law .  He provides great commentary of grand slam home run acquisitions like Google buying YouTube, Facebook buying Instagram and Priceline buying Booking.com.   These are legendary acquisitions and the best of serial acquirers like Google, Facebook, and Priceline.  For example, according to CB insights Googl
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