Pricing, SaaS, Venture Capital, Biz Dev, Product Management, Sales, Marketing, Growth Hacking, and more, Weekend Roundup Must Read Sept 7 2013
This weekend’s Roundup #9 from Startup Management is a manual selection from the hundreds of weekly articles being curated. Previous issues are available here. There are 21 links in this edition, and please feel free to FORWARD to a friend, so they can sign-up and benefit too.
One of the factors in startup failure is when the product roadmap drifts away from the core value proposition. In Introducing Product/Value Alignment: What Comes After Product/Market Fit, I go over the steps to define a strong value proposition so you can align it with your product roadmap to facilitate the realization of your business model. And Gojko Adzic explains how to avoid a common mistake product teams make when they confuse themselves with their customers, in How we solved our #1 product management problem.
Semil Shah puts into question the Demo Day rituals, and names VCs, Accelerators and Startups as accomplices. This will not be the last discussion on this topic, in Unlearn.
In From 0 to 2 Million DAU’s: The Guide to Growing Your Startup via Partnerships, Brian Balfour lays out a detailed process for developing B2B2C partnerships. One of his first rules: “never consider B2B2C partnerships prior to Product/Market fit.” This is a must read.
In Being Different with your Marketing Thinking, I outline two cases of creative marketing from Tesla and Easigrass where out-of-the-box ideas allowed them to get noticed.
In Putting the ‘mium’ in Freemium and Getting Away with It, Dror Bren offers 4 excellent Do’s and Don’ts. My favorite one is “Let the user know what’s free and what’s premium. A frustrated user isn’t a paying one.” Patrick Campbell has an insightful post, How Discounting is Killing Your Pricing Strategy, offering 3 steps for moving beyond discounts; “Blindly discounting is one of the worst things you can do, because you’re conditioning your customer into de-valuing your product.” And in a contrarian to freemium post, Here’s why we dropped our free plan, Nikos Moraitakis explains what happened when they dropped their free plan and created a very affordable plan instead; “Customers who expect to get real value out of your product are the only customers you have a chance of making happy.”
The Decline and Fall of Flowtab, A Startup Story is a long post that chronicled the high and lows of Flowtab who seemed to have done the right thing. It ends with “we believe the real failure would be not sharing our story with the world.” This post generated 226 comments.
Matt Blumberg’s new book Startup CEO is out now, and Brad Feld pounces on a key nugget in the book, Building A Business Operating System. Yes, you need to be methodical and disciplined about your growth process, from a CEO management perspective. Kulveer Taggar has an account about the CEO Coaching he has been receiving, because “you don’t know what you don’t know”. And keeping with that same theme, there is some good advice from a New York Times interview with Francisco D’Souza, CEO of Cognizant in Knowing your (personal) Blind Spots.
State of SaaS
David Skok has the honors of introducing the 2013 Pacific Crest SaaS Survey, a must read (and keep) for anyone involved in SaaS. Some highlights: average growth: 47% vs. 41% in 2012, 90% growth if via Internet sales. 92 cents on the dollar is the average cost of acquiring a customer, but it drops to 17 cents for existing customers. “Try before you buy” has much higher conversion rates than Freemium. Median churn: 9%. Median capital raise: $9MM.
Bessemer has released their Software as a Service Pricing Strategies White Paper, analyzing four of the most common SaaS pricing models: Freemium, Consumption, Tiered, and Perpetual License. It includes case studies from HubSpot, Assistly, ZipCar, Twilio, Oracle and others. Must read. Here’s the pdf download link (20 pages).
Finally, someone (Joel Andren) is calling BS on the cult of growth hacking. What tipped Joel was an overly promotional, over-the-top, “horrendously hyperbolic” post by Ryan Holiday. I cringed at it too.
Rand Fishkin has an interesting post, The T-Shaped Web Marketer, where he lays out a horizontal row of knowledge areas where you can have a broad array of skills, versus a vertical column where you have deep knowledge/ability in one, or a few areas. And I compare and contrast Big Company vs. Startup Marketing stressing that you can’t automatically translate what works in a large company vs. a smaller one.
HubSpot continues to brainwash us about the benefits of Inbound Marketing, and how pervasive it is becoming. In No Sale Left Behind: Sell More, Better, Faster With Inbound Sales, Brian Halligan, CEO of HubSpot says to “go all inbound”, and offers 5 ways to do that. In contrast, Salesforce.com offers 3 steps to Closing More Sales Without Lowering Prices, for those (most of us) that are still selling the old fashioned hard way.
Bijan Sabet poses a very insightful question, in Early Adopters: So Right at First and Then So Wrong Later On?, where he wonders if there’s an “innovators dilemma amongst users”. My viewpoint is that early adopters represent a small, early market. As the startup grows, it then needs to serve a larger market, and not just the early adopters.
For a quick checkup on the state of your SEO, look no further than Rand Fishkin’s whiteboard session on Weighting the Clusters of Ranking Factors in Google’s Algorithm, where he lists the top 9. Not surprisingly, links are still a big deal, but brand metrics are on the rise. Social is still minor. Take-away: look at your own segments and compare.
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