SaaStr

DECEMBER 2, 2023

Dear SaaStr: What Is The Optimal Structure of an Initial SaaS B2B Sales Team? Where, roughly speaking, each sales rep brings in at least 4x-5x the total compensation they take out. The sales-driven SaaS companies that are very capital efficient generally end up at 4x-5x or greater as a ration of average quota attainment / average OTE.

B2B 85

B2B Quota Account management Gaming 85

SaaStr

DECEMBER 27, 2023

operating margins and free cash flow are. But it’s raining cash, and earnings per share is growing 22% — faster than revenue. Super, Duper Efficient Now — 42%+ Operating Margins Digital Ocean was pretty darn efficient last year, with 40% EBITDA Margins and 16% free cash flow. Or at least.

Growth 86

Growth Price Service Customers 86

SaaStr

MARCH 29, 2024

So in the end, they bought this smaller competitor that was at $10m ARR … but growing basically 0%, albeit cash-flow neutral. They’ll make the bet they can build on this core, and in effect, by doing so both re-accelerate growth and save several years of product development and early sales. But barely growing at all.

Growth 91

Growth Price Strategize Closing 91

The 5% Institute

MAY 11, 2023

At The 5% Institute , we understand the importance of sales turnover for any business. It is a key metric that provides insight into the effectiveness of your sales strategy. However, many business owners find it challenging to determine their sales turnover accurately. What is Sales Turnover?

Sales 52

Sales Closing Price Service 52

SalesProInsider

MARCH 17, 2021

We offer 30 minutes of free coaching focused on a specific sales situation of the person’s choice, which we call Sales Strategy Conversations. Whats to WiifTs in Action: Cash Flow Analysis. Let’s do another example with a different service you might provide: cash flow analysis.

Prospecting 147

Prospecting Sales Drivers/motivators Service 147

SaaStr

NOVEMBER 8, 2022

ZoomInfo, PayCom, Zoom an more mint cash. Some are barely burning any cash. If you read a lot of the SaaS and even Wall Street press, you’ll think that most SaaS companies basically have to burn cash almost forever. Salesforce didn’t generate significant free cash flow until it crossed $1b or more in ARR.

Quota 109

Quota Contract Price Growth 109

SaaStr

FEBRUARY 21, 2024

Blackline is one of the leaders in accounting software and invoicing-to-cash. Growth Has Slowed to 11%, But It’s Efficient, With 23% Free Cash Flow Margins Blackline’s growth has slowed and is approaching the “mature” phase, at just 11% annual growth on 106% NRR. As CEO again. Growth got tougher.

Growth 77

Growth Up-sell Sell Customers 77

SaaStr

APRIL 24, 2024

It has almost 40% non-GAAP operating margins and is on track to generate $1B+ of free cash flow in the coming year. #3. In Cash A good strategy today given their large cash position and strong ARR multiple. #5. Looking to Do M&A With Their $4 Billion (!) Billion in ARR appeared first on SaaStr.

Non-Profits 66

Non-Profits CRM Growth Start-ups 66

SaaStr

MARCH 7, 2022

Let’s look at a few amazing examples:: Zoom generates $2 Billion in free cash flow on $4 Billion in revenue. Atlassian generates $800m in free cash flow on $3 Billion in revenue. ZoomInfo generates $400m in free cash flow on $1 Billion in revenue. Now, the ones generating a ton of cash are special.

Service 111

Service Sell Sales 111

SaaStr

MARCH 27, 2023

So there are 3 things every sales rep I’ve worked with hates: Clawbacks. Tracking-to-Cash , i.e. paying commissions once cash is received, not just once the deal is signed; and A Low Base Salary, No Matter How Much They Make. We won’t dig into this too much here, but sales folks hate it. Usually at least.

Commission 92

Commission Contract Cross-sell Sales 92

SaaStr

MAY 24, 2023

In just a year, Monday has gone from fast-growing but cash flow negative to fast-growing… with pretty incredible 24% free cash flow margins. Product expansion key to its growth — its new Sales CRM already seeing very rapid adoption. Key to That Impressive Free-Cash Flow.

Cross-sell 110

Cross-sell Represent CRM Growth 110

SaaStr

DECEMBER 23, 2023

The Massive Push to Efficiency As almost every public SaaS company got cash-flow positive and radically more efficient, and most startups had to stretch their dollars much further — customer success took a lot of the brunt. The Massive Push of CS into a Sales Function This is an even bigger change. What happened?

Customers 94

Customers Price Start-ups Sales 94

Hubspot

MARCH 25, 2024

If you look at a list of the “fastest” growing SaaS companies, besides having a great product and great go-to-market skills, they’re usually B2B sales-led products. Ramp grew 400% in a year because they could sell longer-term deals and collect more cash upfront. So why stick with it if it's such a slow grind?

Niche 57

Niche Price Contract B2B 57

SaaStr

JANUARY 9, 2023

I see SaaS companies quickly get to cash-flow positive by really only servicing in-bound customers with high intent. Well at a practical level, many SaaS companies are doing a Strategic Sales & Marketing Retreat. What’s a Strategic Sales & Marketing Retreat? Second, you slow or stop sales hiring.

Strategize 104

Strategize Territory Referrals Quota 104

SaaStr

AUGUST 18, 2023

Toast dominates the restaurant POS space but its model has some inherent challenges in getting to positive operating margins: it sells to SMBs with a sales-driven model (harder), it has high hardware costs that it loses money on, and it has high services costs onboarding these small customers. While Still Growing 43% at $1.1 Billion in ARR!

Growth 76

Growth Service Sell Sales 76

SaaStr

MARCH 22, 2023

UiPath is now generated $100 million in free cash flow last quarter. Wall Street is happy to trade somewhat slower growth if it’s paired with even non-GAAP profits and material free cash flow. UiPath has cut Sales, Marketing, and G&A expenses at scale — and generated a ton of free cash-flow because of it.

Non-Profits 91

Non-Profits Growth Engineering Start-ups 91

SaaStr

DECEMBER 4, 2023

With the turbulence in the market in 2023, sales cycles have only been getting longer and a lot more complicated. At this year’s SaaStr Annual , CEO and co-founder of Capchase Miguel Fernandez and Director of Marketing Rose Johnson share five tips for getting sales right in any market. Lay out the sales process early on.

Contract 82

Contract Price Healthcare Commission 82

SaaStr

APRIL 6, 2022

Generating Real Free Cash Flow Now — But Not Until After a $1B Run Rate. It’s investing heavily in growth and hasn’t generated free cash flow until just recently, really Q4’22. But now they are predicting a 15% adjusted free cash flow at a $2B run rate. #5. 4,000 employees at $1.5B

Growth 105

Growth Engineering Customers Sales 105

SaaStr

SEPTEMBER 13, 2023

Fast forward to today, Samsara is at almost $1 Billion ARR growing a stunning 40% — and are now cash-flow positiv e. In 5 quarters, Samsara went from -25% free cash flow to +2%, and -13% non-GAAP operating margins to -3%. Adding Back Sales Capacity Now. But you can be too efficient in sales.

Non-Profits 90

Non-Profits Commission Growth Engineering 90

SaaStr

DECEMBER 21, 2022

in revenue in 2021, about $8B dropped to operating income and well over that in free cash flow. Half of every dollar Adobe takes in turns into free cash flow. Adobe brought in a record $7.84B in free cash flow in 2022. Only spends 18% of revenue on R&D (engineering), and just 30% on sales and marketing.

Represent 101

Represent B2B Engineering Growth 101

SaaStr

AUGUST 20, 2021

Both have a sales-driven process, selling to SMBs. One is cash-flow positive. The other is burning a ton of cash. The cash-flow positive one has 130% NRR from SMBs and has several years of existing customers to renew. Renewals and 130%+ NRR are very cost-effective drivers of cash flow.

Drivers/motivators 109

Drivers/motivators Up-sell Pipeline Gaming 109

SaaStr

FEBRUARY 14, 2023

While this fights inflation, it also means that high-growth companies have prospects who see cash flow very far in the future and buy into the company’s future growth. When the overall interest rate is higher, you need to discount those future cash flows to the present to understand the value of the company today.

Profit margin 80

Profit margin Drivers/motivators Cross-sell Growth 80

SaaStr

MAY 25, 2022

Fast forward to today, they are now crossing $500,000,000 in ARR growing modestly but consistently at 14% Year-over-Year: They’re also a case study of sloooowly going upmarket from the original PLG SurveyMonkey self-serve days to a sales-driven motion and product. Free cash flow still negative, operating margins of 2.3%.

Drivers/motivators 91

Drivers/motivators Growth Product Customers 91

Sales Pop!

MAY 9, 2024

By generating payment links for event registrations, ticket sales, or deposits, they eliminate the need for paper-based invoices and manual payment processing. This not only saves time for both parties, but also reduces the likelihood of payment delays and thus improves cash flow.

Clients 52

Clients Contract Trust Process 52

Sales Gravy

FEBRUARY 25, 2024

On this episode of the Sales Gravy Podcast, Jeb Blount sits down with KaTom CEO Patricia Bible to discuss what it takes to lead and sustain a hyper-growth company. Financial Acumen Managing financial resources wisely to fuel growth while maintaining healthy margins and cash flow.

Growth 95

Growth Strategize Technology Technology 95

SaaStr

AUGUST 7, 2023

Lemkin and the Monday team share how this manufactured metric doesn’t determine cash flow and what metrics you can use instead. Another problem with CAC and LTV is that it doesn’t measure cash flow. They cared about cash in the bank — how much they spent, when they spent it, and how fast the actual money came back.

Finance 74

Finance Manufacturing Niche Growth 74

SaaStr

MARCH 1, 2022

Perhaps because it combines strong growth with significant free cash flow. At $3B ARR it’s growing 37%, and free-cash flow is running at $800m a year. That’s insanely cash-creating, with a 29% free-cash flow margin. Generating incredible free cash-flow. Just incredible.

Cross-sell 113

Cross-sell Price Growth Up-sell 113

SaaStr

OCTOBER 11, 2023

Now, they have monday Sales CRM, a complete organization within the company. Nobody Measures Cash, But They Should For folks who don’t have to worry about operating margins or free cash flow, this chart is night and day. They were burning cash, but growth was incredible. 26 of every dollar is going to cash flow.

Growth 63

Growth Non-Profits Drivers/motivators Construction 63

SaaStr

APRIL 26, 2022

It's doing that, AND generating $200m of free-cash flow a year. Zscaler’s sales team is also similarly constituted, with an equal amount of the team outside the U.S. #3. Sales + Marketing declined from 59% of revenue to 47%. Their long term goal is to get Sales & Marketing to 33%-37% of revenue. #4.

Growth 90

Growth Trust Customers Sales 90

Search Engine Land

OCTOBER 25, 2023

Many B2B companies view organic search as a way to build their brand and drive sales. The sales cycle is much longer and harder to measure compared to B2C. Still, some common traits are annual revenue, number of employees, industry, geography, anticipated length of sales cycle, and key personas.

B2B 123

B2B B2C Non-Profits Education 123

SaaStr

FEBRUARY 3, 2023

Probably a mistake, but it let us put that money into sales comp. After we got cash-flow positive, we ramped up hiring and spend, and doubled not too long thereafter. We didn’t have any excess capacity in the sales team at all. Still, it did work, and the business was always cash-flow positive thereafter.

B2B 90

B2B Engineering Growth Product 90

Sales Pop!

MAY 15, 2023

In today’s competitive ecommerce landscape, optimizing your cash conversion cycle (CCC) is critical to the success of your business. By streamlining your invoicing process and improving your payment terms, you can accelerate your cash flow and reduce your financing costs. But first, what is the cash conversion cycle?

Conversion 52

Conversion Non-Profits Finance Profit margin 52

SaaStr

JANUARY 24, 2023

Much of the increased competition can be attributed to adjacency, as Shulgan explains: “Free cash flows are down because of the increased competition that we’re experiencing with markets. Free Cash Flow is down due to rising costs and increased competition due to companies selling into adjacency.

Growth 86

Growth Up-sell Start-ups Price 86

SaaStr

MAY 31, 2023

Getting Radically More Efficient, With Non-Gaap Free Cash Flow Doubling from 12% to 25% of Revenue. Not only has its free-cash flow doubled in just one year from 12% to 25%, but it’s predicting epic free cash flow in 2024 of 46%. This is the theme of the day. This is how you get more efficient.

Growth 77

Growth Engineering Customers Sales 77

Lead Fuze

MAY 26, 2023

Staying abreast of the changing digital landscape is a must for those in sales, recruitment, startups, marketing and small business ownership who want to stay competitive. socialmedia #networkingtips” Click to Tweet Cash Flow Stability: Securing Your Agency’s Financial Future Let’s talk money, honey.

Niche 98

Niche Finance Negotiate Technique 98

SaaStr

SEPTEMBER 20, 2023

Beyond multiples, many Cloud companies faced a deluge of headwinds that impacted business fundamentals… Lengthening sales cycles Tightening customer budgets It was no surprise that SaaS IPOs came to a screeching halt. A 1% improvement in revenue growth today has the same impact on valuations as a 2% improvement in free cash flow margin.

Growth 93

Growth Negotiate Finance Contract 93

SaaStr

DECEMBER 7, 2022

29% of that revenue falls to free-cash flow. 120% NRR for 4+ years. Running lean, but not hyper lean, on both engineering and sales / marketing. Dynatrace spends 35% of its revneue on Sales + Marketing versus the 50%+ of SaaS leaders that are less profitable, and 15% of R&D instead of 25%. Profitable growth.

Growth 82

Growth Engineering Service Sales 82