Scaling First Revenue: Don’t Forget ARPU Expansion.

Most Enterprise markets are somewhat finite regarding the number of customers: F1000 by definition has exactly 1,000 companies (d'oh!). Getting new customers is good. That usually comes in cycles: yay, the first customer! Oh no, who's next? I think I figured it out.... Darn copy-cats! You will hit the point where competition isn't sleeping anymore. … Continue reading Scaling First Revenue: Don’t Forget ARPU Expansion.

Discuss Your Offensive and Defensive Strategic Options With Your Board.

Startups are notoriously short on resources, especially when they are rapidly scaling. Scaling friction takes more tolls than anticipated. At these moments, startups become vulnerable to ecosystem changes: Not because they need to take immediate action, but because the perceived threat came as a surprise and your organization is frantically scrambling to understand your options … Continue reading Discuss Your Offensive and Defensive Strategic Options With Your Board.

The Most Important Executive Besides the CEO.

Up to a year ago, I would have said that the CTO is the most important person after the CEO for enterprise software startups. I'm a tech geek, so that's natural. Without a working prototype or technology, there is no high-tech startup, so for most high-tech startups engineering is pretty important, obviously. By now I … Continue reading The Most Important Executive Besides the CEO.

Scaling First Revenue: IT Infrastructure.

Enterprise IT Infrastructure has probably the most disciplined budgeting process and most rigorous procurement department. Not that they are always on target, but they have a very clear understanding of the different buckets, ROI, impact on operations, and necessary multi-vendor management. Enterprise IT infrastructure organizations know the percentage their enterprise wants to spend on IT … Continue reading Scaling First Revenue: IT Infrastructure.

Production, not Product, as Competitive Strength

Talk about burying the lead: "The competitive strength of Tesla is not going to be the car; it's going to be the factory," Musk said. https://arstechnica.com/cars/2018/02/tesla-loses-another-675-million-in-q4-its-biggest-quarterly-loss-yet/ Car manufacturers have known that for years (though some seemed to have forgotten about it) If you ever toured the factory floor of BMW in Munich, you know how … Continue reading Production, not Product, as Competitive Strength

Scaling First Revenue: Industry Focus.

Short answer: Don't. Don't worry about your industry focus (yet), unless you are clearly a vertical solution for a very specific industry; unless you and your first sales team only have experience in selling into one specific industry and have no other contacts and you are determined to keep only this team for a while … Continue reading Scaling First Revenue: Industry Focus.

Cloud Index: EBITDA Margins versus Revenue Growth

I got a lot of good feedback on my last post on SaaS: Should You Fix EBITDA Margins or Revenue Growth? The main criticism was that the companies of each cell were not true peer-companies and a such not comparable. I admit that perhaps it was a bad judgment using these companies to illustrate NTM revenue growth and … Continue reading Cloud Index: EBITDA Margins versus Revenue Growth

SaaS: Should You Fix EBITDA Margins or Revenue Growth?

First off: You should have a great product. It's pointless to try and "fix" revenue growth if you don't have a great product. But perhaps you have too many products, or your prospects don't understand what you stand for, or your operations are less than optimal. [At the end of this post I will include … Continue reading SaaS: Should You Fix EBITDA Margins or Revenue Growth?