SaaS Business

“Like adding AI to your SaaS business is not going to save you and suddenly make software a business again.”

“It's totally fair to look at SaaS business that way, because SaaS business, you know, many of the SaaS business has very high gross margins, and they have a very, very high profit margins at a steady state basis. So you can predict the cash flow Based on the c…”

“I think the most challenging part of, say, a software business, SaaS business, is if you rush too fast to try to force revenue growth, sales growth, but the product market fit isn't there, There's a lot of companies that have tried that, and you just, you neve…”

“This idea of like creating a negative CAC SaaS business is Probably the only way to build a successful SaaS business today in my mind.”

“I feel like we're always told when you start a SaaS business, like, oh, you're going to be valued off of profit, off of revenue, right? You're going to get three to five times whatever your revenue is and, like, just, I mean, yeah, that's true in some cases, a…”

“Running a SaaS business without deeply understanding churn, LTV, CAC, etc., is like flying a plane without instrumentation.”

“When you start a SaaS business, like Shopify app, for example, you need to not grow fast in the beginning. Because in the beginning, you will have issues with the app, user issues, and once a user has an issue, and the app's not performing well, you will just …”

“That is an example of something that is very replicable in almost any SaaS business. It's very easy to implement and will drive your user retention up.”

“So tip, it's not unusual for a pretty well-run profitable scale, you know, at scale SaaS business to be doing thirty-ish percent free cash flow that could be kicked out of dividends. Now, if you do the math on that, if that same business is growing well enough…”

“I always said, I could underwrite a restaurant better than a bank. I don't need your tax returns. Just put a sensor in your restaurant, and I'll track the traffic and be able to lend you better than any bank could, and a bank can't do that, and in a similar se…”

“Really, it speaks to the reality that for a SaaS business, for a recurring revenue-based business, thinking of marketing as an activity that ends when a new customer signs up is just the tip of the iceberg, right? Because if the business lives and dies by cust…”

“If you think about running a marketplace, you're basically like a gardener. You have to have a very light touch. Like if you're building a SaaS business, you're a construction worker. You're like building the product and the features and selling it. And it's t…”

“Let's say that you own a SaaS business. And your entire net worth is in the SaaS business and you currently you know, you've raised money at 20 times revenue or something. You might want to find a SaaS business that's publicly traded, that is a comp to you. An…”

“And this new, new segment, these clinics, they operate in a much higher volume than a SaaS business for example If you have a SaaS business that have, let's say, 2000 customers, it's a big SaaS business. If you have a clinic that has 2000 customers, it's just …”

“I think selling lifetime plans in a SaaS business is potentially the dumbest thing you can do unless you're just totally broke and you're trying to fund some development.”

“A nice target for a SaaS business is to achieve a 130% revenue retention. So this means net of churn in downgrades Your existing customer base that sticks around is actually paying you more over time on the order of a 130% revenue retention. So let that be the…”

“Imagine, you know, you're able to kind of increase your pricing by, say, one percent, 10%. That's a one percent or 10% increase of your company value in a SaaS business. We're looking at pure Margin here.”

“The norm in the SaaS business, incidentally, is to be willing to pay up to 12 months of revenue.”

“Any SaaS business that has a monthly churn higher than, you know, call it four or five percent. You might just sell a one-time subscription.”

“Any business that's growing less than a hundred percent has the majority of their this year's revenue locked up in renewals and upsells, not net new business.”