This article is part of a series titled “The Art & Science of Growth
Hacking” that will be published over time. My thanks to Gail Goodman, the
founder and CEO of Constant Contact for introducing me to this concept. Free
trials and freemium products are two of the best ways to sell your product.
This article looks at the high level goals of a SaaS business and drills down
layer by layer to expose the key metrics that will help drive success.
Metrics for metric’s sake are not very useful. Instead the goal is to
provide a detailed look at what management must focus on to drive a
successful SaaS business. For each metric, we will also look at what is
Before going any further, I would like to thank the management team at
HubSpot, and Gail Goodman of Constant Contact, who sits on the HubSpot board.
A huge part of the material that I write about below comes my exp... (more)
“If you cannot measure it, you cannot improve it” – Lord Kelvin
This article is a comprehensive and detailed look at the key metrics that are
needed to understand and optimize a SaaS business. It is a completely updated
rewrite of an older post. For this version, I have co-opted two real
experts in the field: Ron Gill, (CFO, NetSuite), and Brad Coffey (VP of
Strategy, HubSpot), to add expertise, color and commentary from the viewpoint
of a public and private SaaS company. My sincere thanks to both of them for
their time and input.
SaaS/subscription businesses are more complex th... (more)
As a serial entrepreneur, I learned a lot of lessons from things that
didn’t work. These lessons later on shaped my ideas on what would be needed
to build a successful startup company. When I became a VC, I realized that
these same lessons could be applied to helping evaluate the many businesses
that I was getting to see. Whilst the following criteria are by no means a
guarantee of success, or the only criteria that you should think about, I do
believe they can be very helpful.
So in no particular order, here is a list of six questions that I learned to
ask to validate my own st... (more)
In the many thousands of articles advising entrepreneurs on what they have to
focus on to build successful startups, much has been written about three key
factors: team, product and market, with particular focus on the importance of
product/market fit. Failure to get product/market fit right is very likely
the number 1 cause of startup failure. However in all these articles, I have
not seen any discussion about what I believe is the second biggest cause of
startup failure: the cost of acquiring customers turns out to be higher than
expected, and exceeds the ability to monetize th... (more)