Kupor: SaaS subscription economics mirror traditional cable and telecom business models
Scott Kupor · a16z Podcast | Valuing Today's Fast-Growing Software Companies · Jan 2, 2019 · at 21:55
Scott Cooper, managing partner at Andreessen Horowitz, discusses SaaS valuation and unit economics by drawing parallels to legacy subscription businesses.
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“None of this stuff is actually that new, this concept that we're talking about here, right? So if you think about, you know, a company like Comcast, right, or you think about AT&T, they'got this same problem, which is, you know, it costs a lot of money to acquire customers, right? It's one reason why the marketing budgets, right, for these companies are so big, right? But the reason they're willing to do that and spend a hundred million dollars on marketing is because once they get you as a customer, the likelihood of you staying is pretty good, and then now they've got this, again, same thing like SaaS, right? It's a subscription business, right?”
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