Gail Goodman Constant Contact - Lessons learned running a SaaS business for 17 years
Lessons Learned in 17 years Building and Exiting a SaaS Business When Gail became CEO of Constant Contact 17 years ago, she had to persuade venture capitalists that selling anything to SME/SMBs was possible, let alone an online service – THIS WAS THE LAST MILLENNIUM! It wasn’t easy to make it work (see her previous Business of Software Conference Talk – ‘The Long Slow, SaaS Ramp of Death‘. Over this time, the business grew to over 1,400 people, went through an IPO with a market cap of over $1 billion and attracted more than 650,000 small business customers (that were impossible to market to). In November 2015, Constant Contact was sold to Endurance Software for $1.1b. One of her legacies to the software industry has been proving you can build a profitable business in the SMB space. Today, SME/SMBs are a recognised and attractive market segment for software companies and significant amounts of venture funding is available to go after it. Gail considers some of the things she has learned about marketing and serving SMB customers, about the software industry and about leadership along the path to a scale business. She will also share her thoughts behind the ultimate sale of the company, something she describes as good for customers, for employees and for shareholders, even if it was a bittersweet process for her personally.
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Gail Goodman Constant Contact - Lessons learned running a SaaS business for 17 years
- 1. LESSONS LEARNED Insights Gained From 17 Years Of Running (and Exiting) A SaaS Business Gail Goodman, Former CEO of Constant Contact @Gail_Goodman
- 2. revenue time
- 3. Q32002 Q42002 Q12003 Q22003 Q32003 Q42003 Q12001 Q22001 Q32001 Q42001 Q12002 Q22002 Q32000 Q41999 Q12000 Q22000 Q42000 Lifetime of a business in three parts… 1999 – 2003 $1,000,000 $200,000
- 4. Lifetime of a business in three parts… Q12002 Q11999 Q12000 Q12001 Q12003 1999 – 2003 Q12004 Q12005 Q12006 Q12007 Q12008 Q12009 $30,000,000 2003 – 2009 Q32015 Q12010 Q12011 Q12012 Q12013 Q12014 Q12015 $90,000,000 2009 – 2015
- 5. Lessons I’ve learned along the way…. • Revenue and growth • Leadership and team • Strategy • Combining forces
- 6. It’s all the same funnel. Conversion Lifetime customer value Retention Attrition
- 7. Customer referrals are like rocket fuel. The early experience is really important. The on-going experience matters, too.
- 9. …so inevitably, you’ll need to rebuild and simplify.
- 10. Growth is fun! (And a little dangerous.)
- 11. Lessons I’ve learned along the way…. • Revenue and growth • Leadership and team • Strategy • Combining forces
- 12. When people say, “It’s all about the team”… …they mean the team...not just the quality of the individuals.
- 13. Mission Vision Values Alignment matters...BIG TIME!
- 15. Lessons I’ve learned along the way…. • Revenue and growth • Leadership and team • Strategy • Combining forces
- 16. Defend your core at all costs. You may have a moat… but your competitors will innovate a way around it.
- 17. Second acts are hard to find… stay close to the core.
- 18. + = ? Acquisitions are hard… no matter which side you’re on.
- 19. Lessons I’ve learned along the way…. • Revenue and growth • Leadership and team • Strategy • Combining forces
- 20. Hard to know when it’s time to combine forces. ? ? ?
- 21. ARPU Retention EBITDA Cashflow Public valuations driven by revenue growth Our situation in 2014… Q1 Q2 Q3 Q4 50,000 Customer growth was “stuck” New Customers
- 22. ☐ Customer funnel ☐ Company culture / team ☐ Focus on SMB ☐ Geographic proximity ☐ Customer funnel ☐ Company culture / team ☐ Focus on SMB ☐ Geographic proximity ✘ ✔ ✔ ✔ ✔ ✔ ✔ ✘ ✔ ✔ ✔
- 23. Turning the page was very bittersweet…
- 24. It was the end of an era. And it had been a very good run. $370,000,000 in annual revenue $ 650,000 customers 1,400 employees EE 17 years
- 25. I could not be prouder of what we built together.
- 26. LESSONS LEARNED Thank you! Gail Goodman Former CEO, Constant Contact @Gail_Goodman
Editor's Notes
- Some of you may remember that I talked about the SaaS slow ramp of death a few years ago.
- Played off of the “different world views” idea…
- Rough flow: “Hard to know…” builds automatically when the slide loads [click to build] the group of lines/questions marks (representing possible targets/partnerships) builds [click to build] the measuring stick and the “MVV” build for talking about how to measure what would be the right opportunity, which sets up the segue into talking about the CTCT situation in 2014...
- NOTE: graph is obviously not to scale…just trying to show a “new customer” line that is hovering at 50k...
- Rough flow (from your notes): “Gail” and “Bachelors” build when the slide loads [click to build] criteria for Bachelor 1 build and then the check-marks/x’s build after them [click to build] criteria for Bachelor 2 build and then the check-marks/x’s (and extra check-marks next to Customer funnel) build after them