“Talent is everywhere, opportunity is not”. This is a quote from my latest Escape Velocity Podcast guest, Marvin Liao, formerly a partner at 500 Startups. 500 Startups is a venture capital fund that runs an accelerator in San Francisco and invests in seed rounds for tech startups.
If you want to start a new SaaS business in 2021 without tearing your hair out, my advice is: Find a co-founder. You shouldn’t have to do it all on your own… and it’s better that you don’t.
How are angel investors different from venture capitalists? Both invest in businesses. Both can write you big checks. Both have the power to help your business growth with a cash injection you otherwise would never get. Are they the same? Heck no. I found this out the hard way…
Your website is polished. Facebook ads retargeting, Google ads pushing your domain to the top of the results page. Traffic trickles through… starting with a sign-up for a free trial. All your PPC ad spend is balancing on a knife’s edge. But here’s the question: Will the prospect convert from a free trial to a paid customer?
In 2009, my mentor Dharmesh Shah (co-founder of Hubspot) sat in my office in San Francisco and casually dropped an acronym I hadn’t heard. “We want to increase our ARPU”, he said. I smiled and nodded… but the blank stare on my face was a giveaway. I was clueless.
Many founders throw money at new employees hoping their business will grow… Only to find they don’t know where to ‘put’ their new employees, and they end up wasting cash on salaries for an under-utilized team. Ever experienced this before? I definitely have. See, I believe a successful founder doesn’t just build a business…
Back in 2012, when I raised $1.6M in funding for Clarity.fm, I insisted on squeezing more out of my investors. When I put together the final cap table, I made it clear that I also wanted introductions with other investors and businesses on their portfolio. They told me, “Dan, you’re asking a lot here…” But I put my foot down.
I don’t think a SaaS founder should be their own accountant. I’m not, and I wasn’t for all 5 of my companies. Your job is to get really good at running a business and making money. That’s it. But to do that, there is ONE type of accounting that I believe you NEED to understand: Accrual Accounting.
I believe that great SaaS founders stay ahead of the curve. They’re the trendsetters, not the trend-followers, willing to try something new that makes waves in the market. The problem is that I’ve encountered many cutting edge SaaS businesses whose marketing efforts are too far behind the times.
If you want consistent, predictable revenue for your SaaS then there’s one thing you’re going to need to build: A killer sales team. Don’t roll your eyes yet… Let me set the record straight.
