Keynote by Patrick Campbell, CEO, Price Intelligently & Profitwell from SaaStock on Tour Helsinki, May 2018

1. Brought to you by
Winning in the SaaS Economy.
SAASTOCK HELSINKI - MAY 2018

2. Brought to you by

3. Brought to you by

4. Brought to you by

5. Similar traits
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6. • Old in software years
Similar traits
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7. • Old in software years
• Raised $100M+
Similar traits
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8. You
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9. You
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10. You
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11. You
• Really good tech
Brought to you by

12. You
• Really good tech
• Some great design
Brought to you by

13. You
• Really good tech
• Some great design
• Low money
Brought to you by

14. You
• Really good tech
• Some great design
• Low money
Brought to you by

15. You
• Really good tech
• Some great design
• Low money
Brought to you by

16. You
• Really good tech
• Some great design
• Low money
Brought to you by

17. You
• Really good tech
• Some great design
• Low money
Brought to you by

18. You
• Really good tech
• Some great design
• Low money
Brought to you by

19. You
• Really good tech
• Some great design
• Low money
Brought to you by

20. Brought to you by
This is not how you build a business.

21. Brought to you by
We’ve uncovered the secret to building a high growth
SaaS company, and I’m going to share that with you today.

22. Brought to you by
“Listen large, bearded, preachy man…
…who the hell are you?”

23. Churn Insights
Attribution Data
Financial Data
Unit Economics
Demographics
Price Sensitivity
Survey Data
Willingness to Pay
In-App Usage Data
Drastically reduce churnRETAINTM
Actionable, accurate insights to make you
smarter about your business (for free)
SUBSCRIPTION METRICS
Proprietary pricing software for
monetization
MONETIZE

24. We’ve seen inside more recurring revenue
businesses than anyone else out there.
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25. Brought to you by
I have the secrets.

26. Brought to you by
Well…the data has the secrets.

27. Brought to you by
What are the characteristics of
the fastest growing recurring
revenue companies?

28. • Conduct their customer development/research
• Moved on from acquisition based growth
WHAT DO THE FASTEST GROWING
SAAS COMPANIES LOOK LIKE
— BEINGASUCCESSFULSAASCOMPANY
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29. Brought to you by
Super obvious, right?

30. Brought to you by
WRONG, because you’re not
doing this stuff.

31. Brought to you by
Let’s jump in.

32. Brought to you by
You need to conduct your
customer research.

33. It used to be ok to be lazy with customer
development and customer research.
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36. Brought to you by

37. We’re building the wrong product.
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38. -50%
-40%
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0%
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-0.5 -0.4 -0.3 -0.2 -0.1 0 0.1 0.2 0.3 0.4 0.5
Revenue Drivers
2017 SOFTWARE MARKET SURVEY
THE MARKET IS DROPPING OUT BENEATH US
Measuring consumer sentiment to what we’re building
DEVIATIONFROMMEDIANWTP
RELATIVE PREFERENCE MAGNITUDE
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39. -50%
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-0.5 -0.4 -0.3 -0.2 -0.1 0 0.1 0.2 0.3 0.4 0.5
Revenue Drivers
2017 SOFTWARE MARKET SURVEY
THE MARKET IS DROPPING OUT BENEATH US
Measuring consumer sentiment to what we’re building
DEVIATIONFROMMEDIANWTP
RELATIVE PREFERENCE MAGNITUDE
Brought to you by

40. 2017 SOFTWARE MARKET SURVEY
THE MARKET IS DROPPING OUT BENEATH US
Measuring consumer sentiment to what we’re building
Relative Value of Attributes
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41. 2017 SOFTWARE MARKET SURVEY
THE MARKET IS DROPPING OUT BENEATH US
Measuring consumer sentiment to what we’re building
Relative Value of Attributes
• Taste
• Country of Origin
• Temperature
Brought to you by

42. 2017 SOFTWARE MARKET SURVEY
THE MARKET IS DROPPING OUT BENEATH US
Measuring consumer sentiment to what we’re building
Relative Value of Attributes
• Taste
• Country of Origin
• Temperature
Willingness to Pay
• Price elasticity for a cup of coffee
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43. -50%
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0%
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-0.5 -0.4 -0.3 -0.2 -0.1 0 0.1 0.2 0.3 0.4 0.5
Revenue Drivers
2017 SOFTWARE MARKET SURVEY
THE MARKET IS DROPPING OUT BENEATH US
Measuring consumer sentiment to what we’re building
DEVIATIONFROMMEDIANWTP
RELATIVE PREFERENCE MAGNITUDE
Taste
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44. -50%
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-20%
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0%
10%
20%
30%
40%
50%
-0.5 -0.4 -0.3 -0.2 -0.1 0 0.1 0.2 0.3 0.4 0.5
Revenue Drivers
2017 SOFTWARE MARKET SURVEY
THE MARKET IS DROPPING OUT BENEATH US
Measuring consumer sentiment to what we’re building
DEVIATIONFROMMEDIANWTP
RELATIVE PREFERENCE MAGNITUDE
Taste
Temperature
Country of Origin
Brought to you by

45. -50%
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-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
-0.5 -0.4 -0.3 -0.2 -0.1 0 0.1 0.2 0.3 0.4 0.5
Revenue Drivers
2017 SOFTWARE MARKET SURVEY
THE MARKET IS DROPPING OUT BENEATH US
Measuring consumer sentiment to what we’re building
DEVIATIONFROMMEDIANWTP
RELATIVE PREFERENCE MAGNITUDE
Taste
Temperature
Country of Origin
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46. -50%
-40%
-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
-0.5 -0.4 -0.3 -0.2 -0.1 0 0.1 0.2 0.3 0.4 0.5
Revenue Drivers
2017 SOFTWARE MARKET SURVEY
WE’RE BUILDING THE WRONG PRODUCT
Calculating the expected impact of product on growth
DEVIATIONFROMMEDIANWTP
RELATIVE PREFERENCE MAGNITUDE
Differentiable Features
High Value/High WTP
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47. -50%
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0%
10%
20%
30%
40%
50%
-0.5 -0.4 -0.3 -0.2 -0.1 0 0.1 0.2 0.3 0.4 0.5
Revenue Drivers
2017 SOFTWARE MARKET SURVEY
WE’RE BUILDING THE WRONG PRODUCT
Calculating the expected impact of product on growth
DEVIATIONFROMMEDIANWTP
RELATIVE PREFERENCE MAGNITUDE
Differentiable Features
High Value/High WTP
Add-Ons
Low Value/High WTP
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48. -50%
-40%
-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
-0.5 -0.4 -0.3 -0.2 -0.1 0 0.1 0.2 0.3 0.4 0.5
Revenue Drivers
2017 SOFTWARE MARKET SURVEY
WE’RE BUILDING THE WRONG PRODUCT
Calculating the expected impact of product on growth
DEVIATIONFROMMEDIANWTP
RELATIVE PREFERENCE MAGNITUDE
Differentiable Features
High Value/High WTP
Add-Ons
Low Value/High WTP
Core Features
High Value/Low WTP
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49. -50%
-40%
-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
-0.5 -0.4 -0.3 -0.2 -0.1 0 0.1 0.2 0.3 0.4 0.5
Revenue Drivers
2017 SOFTWARE MARKET SURVEY
WE’RE BUILDING THE WRONG PRODUCT
Calculating the expected impact of product on growth
DEVIATIONFROMMEDIANWTP
RELATIVE PREFERENCE MAGNITUDE
Differentiable Features
High Value/High WTP
Add-Ons
Low Value/High WTP
Core Features
High Value/Low WTP
Trash Land
Low Value/Low WTP
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52. CLEAR WINNERS AND LOSERS
Comparing Cust Dev Strategies of Companies
Acquisition based growth companies grow at a smaller rate than those with a balanced growth
approach (growth from all three pillars of growth).
YOYGROWTHRATE
SOURCE: 2017 STUDY ON CUST DEV
0%
25%
50%
75%
100%
2012 2017
44.821%
31.72%
Minimal Customer Development
Aggressive Customer Development
N
687
N = Minimum of 687 companies per segment pulled from the middle 2/3 of companies in terms of
growth rate. This, along with a dampening model was used to control for outlier spikes in growth rate.
Brought to you by

53. CLEAR WINNERS AND LOSERS
Comparing Cust Dev Strategies of Companies
Acquisition based growth companies grow at a smaller rate than those with a balanced growth
approach (growth from all three pillars of growth).
YOYGROWTHRATE
SOURCE: 2017 STUDY ON CUST DEV
0%
25%
50%
75%
100%
2012 2017
59.08%
44.821%
17.43%
31.72%
Minimal Customer Development
Aggressive Customer Development
N
687
N = Minimum of 687 companies per segment pulled from the middle 2/3 of companies in terms of
growth rate. This, along with a dampening model was used to control for outlier spikes in growth rate.
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54. Do your customer research.
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55. Brought to you by
Focus more on your pricing and
retention, less on your acquisition.

56. Competition is now rampant.
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58. Businesses have lost their power.
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59. CAC is Steadily Increasing Over Time
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61. The relative value of features is declining.

62. THE MARKET IS DROPPING OUT BENEATH US
Consumer Willingness to Pay has Declined Over Time
Software willingness to pay has declined significantly over the past few years due to increased options
and higher demands.
WTPAS%OFWTP4YEARSAGO
SOURCE: 2017 CONSUMER WILLINGNESS TO PAY STUDY
0%
30%
60%
90%
120%
5 YEARS AGO 4 YEARS AGO 3 YEARS AGO 2 YEARS AGO 1 YEAR AGO TODAY
Core Features
Single Sign On
Integrations
Analytics
WHEN MEASUREMENT WAS TAKEN
N = Varies by line, but minimum of 10,000 customer respondents per line
N
921k
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63. Consumers are so ungrateful.
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64. THE MARKET IS DROPPING OUT BENEATH US
Despite Amazing Advances, NPS is Actually Down Overall
Average NPS scores are actually falling pretty dramatically over the past five years, indicating either
we’re just getting worse at our jobs or consumers re expecting more
AVERAGENPSSCORE
YEARS AGO
SOURCE: 2017 SAAS STUDY
0
7
13
20
27
33
40
5 YEARS AGO 3 YEARS AGO 1 YEAR AGO
10.2
19.5
33.8
N = 1,784 software companies
N
1,784
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65. Acquisition is now table stakes.
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66. WE FOCUS ON THE WRONG FUNDAMENTALS
Impact of Improving Each Pillar of Your Business
Monetization and retention based growth far outpaces acquisition based growth. This impact is getting
greater over time.
%IMPACTONREVENUE
SOURCE: 2016 STUDY ON COMPANY UNIT ECONOMICS
0%
5%
10%
15%
20%
ACQUISITION MONETIZATION RETENTION
2.35%
3.32%
2008 - 2012 2013 - 2016
N
734
N = Data from 734 software companies
PILLAR OF THE BUSINESS
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67. WE FOCUS ON THE WRONG FUNDAMENTALS
Impact of Improving Each Pillar of Your Business
Monetization and retention based growth far outpaces acquisition based growth. This impact is getting
greater over time.
%IMPACTONREVENUE
SOURCE: 2016 STUDY ON COMPANY UNIT ECONOMICS
0%
5%
10%
15%
20%
ACQUISITION MONETIZATION RETENTION
9.32%
15.89%
2.35%
6.71%
12.7%
3.32%
2008 - 2012 2013 - 2016
N
1.4k
N = Data from 1.4k software companies
PILLAR OF THE BUSINESS
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68. Monetization and retention are 4-8x more
effective for growth than acquisition.
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69. Brought to you by
How much time do companies spend on their pricing?

70. Brought to you by
Less than 15 hours per year.

72. So which pieces of pricing
should you attack?
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73. Brought to you by
Raise your prices tomorrow.

74. • Body Level One
• Body Level Two
• Body Level Three
• Body Level Four
• Body Level Five
0
25
50
75
100
0 200 400 600 800 1000 1200 1400
MAXIMIZE
PROFITABILITY
Top 25% Sensitivity Curve
MAXIMIZE
ACQUISITION

75. • Body Level One
• Body Level Two
• Body Level Three
• Body Level Four
• Body Level Five
0
25
50
75
100
0 200 400 600 800 1000 1200 1400
MAXIMIZE
PROFITABILITY
Top 25% Sensitivity Curve
MAXIMIZE
ACQUISITION
Nordic companies

76. Charge more.
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77. Scared?
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78. Scared? Ok.
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79. Brought to you by
Price Localization.

82. Localize your pricing.
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83. Brought to you by
Utilize a Value Metric

88. Figure out your value metric.
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89. Brought to you by
Make pricing a process.

91. Pricing matters. Acquisition is par.
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92. • Conduct their customer development/research (+30-50%)
• Get back to your customer research fundamentals
• Don’t be a maverick when it comes to product
• Moved on from acquisition based growth
• Raise your prices (+30%)
• Localize your prices (+30%)
• Utilize a value metric (+50%)
• Implement a pricing process (+50%)
WHAT DO THE FASTEST GROWING
SAAS COMPANIES LOOK LIKE
— BEINGASUCCESSFULSAASCOMPANY
Brought to you by

93. Brought to you by
A lot of you aren’t going to do any of this.

94. You
• Really good tech
• Some great design
• Low money
Brought to you by

95. Brought to you by
This breaks my heart, because you have everything to win.

96. Want the how?
pc@profitwell.com