Make decisions on how to grow your SaaS product business including how to: -Measure growth and define success -Identify common roadblocks to company growth -Determine where to focus your efforts -Refine company & product portfolio strategy and trade-offs -Assess different potential opportunities

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2. The metrics you use to determine growth will change as your company grows
What growth? - what metrics are you using to tell your story; rally the troops,
your clients, investors
-Product capabilities – do you have a vision? Is it on contrast to competitors?
-Cash - living hand-to-mouth; what is your burn?
-Customer adoption – both growth rates and brand name customers
-Revenue growth - better be recurring; how many people have more than
50% revenue non-recurring (services)? Not good for a SaaS business
-Churn (better be less than 10%; your fault much less 10%);
or NPS (net promoter score) asking your clients “how likely would you
recommend our product/service to a friend or a colleague: scale 1-10” 0-6 =
“Detractors” (-1); 7-8 = “Passives” (0); 9-10 = “Promoters” (+1) – as a
percentage across all customers (should be positive!)
-Customer Acquisition Cost Ratio (new gross sales annualized / sales &
marketing cost annually); ideally close to 1 (or more)
-Market share ("#1 or #2 or go home”) and recognition (Gartner, industry
awards)
-Profitability
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3. What roadblocks:
-Define – strategy
-Partner - what need, but not good at and/or doesn't
make sense to build
... if not changing as the company grows; that is a
problem
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4. -Define - problem if CEO can just say "this is what
we need; go build & sell"
Need many ideas, several investigations, few
prototypes, one offering
-Design / develop – iterate quickly with customers
because you aren't right (prototype, quick release
cycles)
-Market / sell - what is conversion rate at each
stage of market / sales funnel? What should be
improved?
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5. Invest in selling more current products for your current
market = market penetration
Invest in building new products for your current markets
= product development
Invest in selling your current products for new markets
= market development
Invest in building new products for new markets =
suicide leap
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6. Where grow: (Later you can fill out what are the appropriate values for each
dimension for your company)
Similar customers: Often more of the same customers is the best way to go.
Bigger / smaller customers: Later considering going up market (larger
customers) or down market.
Industries / verticals: For example may be primarily sell to high-tech and want to
sell to retail or government.
or
Geography:
Often less product development and more marketing / sales activity.
Both can involve a channel strategy
Products/Services: more to current market and customers - what else would they buy
from you?
Ideally it is the same economic buyer and they purchase in the same
way.
Now pick one:
Focus, Focus, Focus – are you a $10M/yr SaaS company and opening an office
in China?
Hardest thing to do is to decide what aren't going to do; not going to be
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7. Customer pain?
Sufficient to buy?
Top problem of economic buyer?
Big enough market?
Market growing?
Changing?
Just because you have something you think people may
find useful
It does mean they have sufficient pain and sufficient
resources to buy it
Remember the total market is smaller than your
addressable market and your share will be smaller still
Define your market as something that you can realistically
become the #1 or #2 vendor
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8. Where should we go?
Problem?
Opportunity?
Why will we be successful there?
Solution
Unique offering, breakthrough?
Why you? Competition?
How do we get there?
Business Model
How make money?
What money need?
Team? (Build? Market? Sell?)
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9. I don’t listen well, but it always seems that I hear the
same story …
We should build spicy mayonnaise, our customers
need it and it is so easy to build and it is so easy to
make money.
But we build software (a very specific type of software)
not mayonnaise, we don’t know how to make
mayonnaise
Just because there is an opportunity, doesn’t mean you
need to or can take advantage of it

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11. This all assumes a green field – no existing products or
contention for resources
However usually as your company grows you have to
make product portfolio decisions

12. Relatively low market share of a slow growing market –
liquidate / divest of the dogs
Relatively low market share of a fast growing market –
divest of most of the question marks; accelerate a few
Relatively high market share of a fast growing market –
great, but others are coming; invest!
Relatively high market share of a slow growing market
– great, harvest (but maybe invest some to lower
attrition)
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