SaaSy bear SaaSy bear what do you see?

Shifts for SaaS - SaaSy Bear

I see 3 shifts critical for me!

Taking a line from the popular Brown Bear children’s book, I believe that our SaaS startups have a real opportunity to leverage some leading shifts in the global SaaS evolution. While there are many areas of change – and none less worthy than the other – I am highlighting 3 shifts for SaaS (tl;dr) which our entrepreneurs can actually work with and help change their orbit:

  • Market shifts with AI/ML for SaaS to build meaningful product & business differentiation,
  • Platform Products shift to transform into a multi-product success strategy,
  • Leveraging Partnerships for strategic growth and value co-creation.

Some background

I joined iSPIRT with a goal to help our community build great global products. I believed (and still do) that many entrepreneurs struggle with the basics of identifying a strong value proposition and build a well thought out product. They need strong support from the community to develop a solid product mindset & culture. My intent was to activate a product thinkers community and program leveraging our lean forward playbooks model.

I had several conversations with community members & mavens on playbooks outcomes and iterating our playbook roundtables for better product thinking. I realized that driving basic product thinking principles required very frequent and deeper engagement with startups. But our playbooks approach model – working in a distributed volunteer/maven driven model – is not set up to activate such an outcome. Through our playbooks model, our mavens had helped startups assimilate best practices on topics like Desk Sales & Marketing, something that was not well understood some years back. This was not a basic topic. The power of our playbook RTs was in bringing the spotlight on gaps & challenges that were underserved but yet highly impactful.

As a product person, I played with how to position our playbooks for our entrepreneur program. I believe our playbooks have always been graduate-level programs and our entrepreneurs are students with an active interest to go deep with these playbooks, build on their basic undergraduate entrepreneurship knowledge, and reach higher levels of growth.

The product thinking and other entrepreneurial skills are still extremely relevant, and I am comforted by the fact that there are many community partners from accelerators like Upekkha to conclaves like NPC and event-workshop formats like ProductGeeks which are investing efforts to build solid product thinking & growth skills.

As the SaaS eco-system evolves, and as previous graduate topics like desk sales & marketing are better understood, we need to build new graduate-level programs which address critical & impactful market gaps but are underserved. We need to help startups with meaningful & rapid orbit shifts over the next 2-3 years.

Discovering 3 Shifts for SaaS

Having come to this understanding I began to explore where our playbooks could continue to be a vibrant graduate-level program and replicate our success from the earlier playbooks. Similar to an entrepreneur’s journey, these three shifts became transparent through the many interactions and explorations of SaaS entrepreneurs.

Market Shift with AI/ML for SaaS

There is no doubt that AI is a tectonic shift. The convergence of big data availability, maturity of algorithms, and affordable cloud AI/ML platforms, has made it easy for SaaS startups to leverage AI/ML. During a chance roundtable learning session on Julia with Dr. Viral Shah & Prof Alan Edelman, it was clear that many entrepreneurs – head down into their growth challenges – were not aware of the realities behind the AI hype. Some thought AI/ML should be explored by their tech team, others felt it required a lot of effort & resources. The real challenge, however, is to discover & develop a significantly higher order AI-enabled value to customers than was feasible 2 years ago. While AI is a technology-driven shift, the implications for finding the right product value and business model are even greater.

As I explored the AI trend I saw a pattern of “gold rush” – build a small feature with rudimentary AI, market your product as an AI product… – making early claims with small changes which do not move the needle. It became clear that a step-by-step pragmatic thinking by our SaaS startups was required to build an AI-based leapfrog value proposition. This could help bring our startups to be at “par” and potentially even leap ahead of our global brethren. Here was an opportunity to create a level playing field, to compete with global players and incumbents alike.

To validate my observations, I did quick small research on SaaS companies outside of India on their approach with AI. I found quite a few startups where AI was already being leveraged intrinsically and others who were still trying to make sense. Investments varied from blogging about the AI trend, branding one as a thought leader, to actually building and delivering a strongly differentiated product proposition. E.g.:

There are no successes, yet! Our startups like Eka, Wingify, FreshWorks, WebEngage… have all been experimenting with AI/ML, stumbling and picking themselves up to build & deliver a higher level of value. Some others are setting up an internal playground to explore & experiment. And many others are waiting on the shore unsure of how to board the AI ship.

How do we enable our companies to create new AI playgrounds to analyze, surface, validate and develop higher order customer values & efficiencies? To chart a fruitful journey with AI/ML there are many challenges that need to be solved. And doing it as a group running together has a better chance of success.

The AI+SaaS game has just begun and it is the right time for our hungry entrepreneurs to Aspire for the Gold on a reasonable level playing field.

Shift to Platform Products

As market needs change, the product needs a transform. As new target segments get added different/new product assumptions come into play. In both these scenarios existing products begin to age rapidly and it becomes important for startups to re-invent their product offerings. To deal with such changes startups must experiment and iterate with agility. They require support from a base “internal” platform to allow them to transform from a single product success strategy to scaling with multiple products strategy.

This “internal” base platform – an infrastructure & layout of technology components to interconnect data & horizontal functional layers – would help to build & support multiple business specific problem-solution products (vertical logics). The products created on such a platform provide both independent as well as a combined value proposition for the customers.

Many startups (Zendesk, Freshdesk, Eka, WebEngage…) have undertaken the painful approach of factoring an internal platform to transform their strategy & opportunity. Zoho has been constantly reinventing itself and launching new products on a common platform, some of which are upending incumbent rivals in a very short period of time. WebEngage transformed itself from a “tool” into an open platform product.

“As the dependency on our software grew, customers needed more flexibility to be able to use their data to solve a wide range of business problems…significant difference in the way we build products now. We have unlocked a lot of value by converting ourselves into an open platform and enabling customer data to flow seamlessly across many products.” – Avlesh Singh, WebEngage

The effort to build an internal platform appropriately architected to support growing business needs (many yet unknown) is non-trivial and requires a platform thinking mindset for increased business development. It must be architected to allow rapid co-creation of new & unique product values in collaboration with external or market platforms. This can help the startup be a formidable player in the growing “platform economy”.

Leveraging Potential Strategic Partnerships

A strategic partner offers 2 benefits for startups. First is the obvious ability to supercharge the startup’s GTM strategy with effective distribution & scale. How does one make a strategic partnership? Pitching to a strategic partner is very different from pitching to a customer or investor. PSPs look for something that is working and where they can insert themselves and make the unit economics even better. 

“I thought I knew my pitch and had the details at my fingertips. But then I started getting really valuable, thought-out feedback…I had to focus on pitching to partners, not customers.” – Pallav Nadhani, FusionCharts

The second leverage with a partner is the ability to innovate in the overlap of the partner’s products & offerings and the startup’s product values. A good partner is always looking for startups which can co-create a unique value proposition and impact an extremely large customer base.

“…we still have only three four percent market share when it comes to customers. So if we have to participate we have to recognize that we are not gonna be able to do it alone we’re going to have to have a strategy to reach out to the entire marketplace and have a proposition for the entire marketplace…you need to (do it) through partnerships.” – Shikha Sharma, MD Axis Bank

Both these partnership intents if nurtured well can bring deep meaningful relationship which can further transcend scale into a more permanent model (investment, M&A…).

Working with the 3 Shifts of SaaS

While each shift is independent in its own importance, they are also inter-related. E.g. an internal platform can allow a startup to co-create with a partner more effectively. Partners are always interested in differentiated leading-edge values such as what is possible with leveraging AI/ML. Magic is created when a startup leverages an internal platform, to co-create a strong AI-enabled value, in the overlap & gap with potential strategic partners.

And that’s what I see

I see a vibrant eco-system of SaaS startups in India working on creating leading global products. Vibrancy built on top of the basic product thinking skills and catapulted into a new orbit by navigating the 3 shifts.

“Reading market shifts isn’t easy. Neither is making mindset shifts. Startups are made or unmade on their bets on market/mindset shifts. Like stock market bubbles, shifts are fully clear only in hindsight. At iSPIRT, we are working to help entrepreneurs navigate the many overlapping yet critical shifts.” – Sharad Sharma, iSPIRT

Through our roundtables, we have selected six startups as the first running group cohort for our AI/ML for SaaS playbooks (Acebot, Artoo, FusionCharts, InstaSafe, LegalDesk & SignEasy).

If you are hungry and ready to explore these uncharted shifts, we are bringing these new playbooks tracks for you.

Please let us know your interest by filling out this form.

Also, if you are interested in volunteering for our playbook tracks, we can really use your support! There is a lot to be done to structure and build the playbook tracks and the upcoming SaaSx5 for these shifts for SaaS. Please use the same form to indicate your support.

Ending this note with a sense of beginning, I believe that our startups have a real opportunity to lead instead of fast-follow, create originals instead of clones. They need help to do this as a running group instead of a solo contestant. It is with this mission – bring our startups at par on the global arena – that I am excited to support the ProductNation.

I would like to acknowledge critical insights from Avlesh Singh (WebEngage), Manav Garg (Eka), Shekhar Kirani (Accel Partners), Sharad Sharma (iSPIRT). Also am thankful for the support from our mavens, volunteers & founders who helped with my research, set up the roundtables, and draft my perspective with active conversations on this topic: Ankit Singh (Wibmo/MyPoolin), Anukriti Chaudhari (iSPIRT), Arvi Krishnaswamy (GetCloudCherry), Ganesh Suryanarayanan (Tata GTIO), Deepa Bachu (Pensaar), Deepak Vincchi (JuliaComputing), Karthik KS (iSPIRT), Manish Singhal (Pi Ventures), Nishith Rastogi (Locus.sh), Pallav Nadhani (FusionCharts), Praveen Hari (iSPIRT), Rakesh Mondal (RakeshMondal.in), Ravindra Krishnappa (Acebot.ai), Sandeep Todi (Remitr), Shrikanth Jangannathan (PipeCandy), Sunil Rao (Lightspeed), Tathagat Varma (ChinaSoft), Titash Neogi (Seivelogic), and many other volunteers & founders.

All images are credited to Rakesh Mondal 

The Making of #PNcamp3 #Hyderabad

Just came back, feeling happy, from Hyderabad after doing the #PNcamp3. The drive from the airport in the evening to Gachibowli was pleasant and I got to see lot of construction in the city. I felt like I was driving in the Silicon Valley highway with wide roads and people driving in their lanes. In the evening, when I drove back from the ISB Campus, it took me just 25 minutes to reach to the airport.

Sunset near the HYD airport

Some background about what we have done so far in the Hyderabad Ecosystem

We have managed to do around 5 playbooks so far, 3 of them have been around Products, 1 of them was by Suresh Sambandam on Nuts & Bolts selling to the US, one of them was on Selling by Aneesh Reddy of Capillary. Few months back, we did put together a playbook around Product Showcase, inspite of having 8–10 confirmations, no one showed up except for Niraj from Hiver who was facilitating the playbook.

I was little upset as I felt founders in Hyderabad did not value the playbooks. I stayed quite for few months and then recently wrote a blog post on my contribution to Chennai and how it is now positioned as a SaaS/B2B hub of India. Chaitanya of Ozonetel tweeted saying he will write a blog post on how Hyderabad is emerging as a B2B hub. I felt guilty of not making an active contribution to the city. So after SaaSx, I thought of putting together PNcamp3, it’s a light format and adds value to the Pre-Product Market Fit stage companies.

The Hyderabad Tech Eco-system

Just to give you a little brief about the Hyderabad tech eco-system, they have an awesome Incubator/co-working space called T-Hub which is truly a global facility. Some of the leading companies from Hyderabad in the B2B space are: Pramati Technologies, Zenoti, Ozonetel, AgileCrm and in B2C we have MeraEvents and NowFloats is in the SMB space. Also you have some emerging players such as ReportGarden, AppVirality, Robustest and few others. This is just a partial list to give an understanding of the tech ecosystem. There are many more which I might have missed.

The team which pulled PNcamp together

Few months back, Shekhar Kirani of Accel had connected me with Sudheer Koneru of Zenoti as Sudheer was keen to get connected to the ecosystem and contribute some of his learnings. Initially, I wasn’t even aware about them, but the more I spoke with Sudheer I found him to be someone who was keen to help the Indian eco-system, keen to do something for Hyderabad. He flew in from Hyderabad as I requested him to attend one playbook before he does any for us….that was a big commitment and he made it happen. I’m quite fortunate to have leveraged Sudheer for 2 playbooks(1 in BLR & 1 in HYD), he was a mentor at PNgrowth and shared his learnings at SaaSx4. Sudheer was the first person who agreed to host #PNcamp in Hyderabad. I then reached out to Chaitanya as he has always been there to support in any initiative that I have reached out to him for. I had been working with Laxman from AppVirality on Beyond Founders…it hasn’t taken off, but I know he was committed and very keen to contribute.

I just shared the format of PNcamp2 that we did in Pune and I said, let’s target around the 75 B2B founders in HYD and do something for startups which are in the early stages. According to Chaitanya, it was a high number, so we settled for around 35–40 as we did not have enough B2B companies in HYD. We did the first blog post announcing PNcamp and noticed that we just got 1 application in 1 week. I realised that we have to probably do little more outreach to get the 35–40 number. Then Sainath Gupta heard about the PNCamp in Hyderabad, he shared it on Facebook and I did speak to him to help us out. Without knowing what we were getting into, he agreed and I set a target for around 75 B2B startups, probably around 40 from HYD and the remaining from other parts of India. I also told him that to get to 75, we have to probably get around 130 applications as we follow a tight curation process. I did update Laxman that we were not doing too well on registrations and he did reach out to Praveen Dorna who was very active in the ecosystem. I got both Sainath & Praveen on a call and requested for help. Both of them took on the target of getting around 75 people for PNcamp. Luckily, we managed to get around 90 applications out of which around 63 were short-listed and eventually 55 showed up for the event.

The day at PNcamp3

We started at 11am sharp with a warm welcome by Sudheer. This was followed by an inspiring talk by Jay Pullur. It’s safe to call him the father of the product ecosystem for Hyderabad. He started Pramati in 1998 and was one of the leading product companies in the Middleware space. Jay shared some insights on what it takes to build a global product company from India. There were lot of questions which came and he gave his insights to the startups and I could see that maturity and the depth of product knowledge that he had gained over the last 19 years.

Audience at #PNcamp3

We quickly moved on to the Product Tear down sessions. I was very nervous till the last minute on how the session would be conducted….but Sudheer and his team which included Mrityunjay, Anand & Bharath did a fabulous job of shortlisting 5 companies.

They actually tested out the functionality, ordered stuff, called up the startups like a customer and availed their service. They did a thorough analysis of their website, their market, their messaging, etc. One of the key things mentioned by the team was copy…copy…copy as the basics were not in place from few companies. This was something which Shekhar had also mentioned when he did the tear down in SaaSx.

Startup going through the Tear down process

The startups who presented got some good value and appreciated the efforts put by Sudheer’s team. Product Tear down is a good format which was started at SaaSx and now we are hopeful that we will be able to take this virtual.

Apart from this, we tried a Pitch tear down session, without the VCs, the session went well and i’m glad that most of the founders were trying to help each other in the session. Kevin William David of Siftery shared some thoughts on how you should be launching your product in ProductHunt. The session was around Product Launch…but a few companies shared their learning on how they launched the product…but it was ok…as the idea was to get them talking.

We were around 5:30pm when Sudheer started his own learnings on Building a Enterprise company for Global markets. He shared his learnings and how they have been obsessed in understanding their customer business. Sudheer and his colleagues actually bought software from the competition to understand how it works and many times went to customer to learn from them….never to sell. That was a very powerful insight. Most of the folks are always in the sell mode when they meet customers…but it was so good to see someone going to meet potential customer to understand how their business works.

Sudheer Koneru from Zenoti

They exactly understood their customers’ business, only then pitched on how their product can add value to their business. Sudheer’s session was very interactive and almost every attendee in the room had a question which he answered patiently. The end time for PNcamp3 was around 6pm and as with all interesting events, it kept stretching. knew that folks were flying back in the same evening, so around 6:45pm I had to bring it to a logical conclusion. We have collected feedback and the NPS score for the event is ~78 which makes my colleague Rajan happy 🙂

Tweet from one of the attendees.

Sudheer hosted some of the folks at his house after the session and it was great to catch up with some folks informally in the evening. I had to rush around 7:45pm as I had a flight at 9pm….and somehow I made it 🙂

I feel happy after making a small contribution to the HYD eco-system and I hope to work with the team again to put together the next #PNcamp in the city. Also, thanks to ISB for allowing us to host PNcamp in their wonderful facility. Was blown away by the infrastructure that the city has.

Blown away by the commitment of folks like Sudheer Koneru, Chaitanya Reddy, Laxman, Sainath Gupta, Praveen & Ronak Samantray for putting a great show. We just pulled this off in less than 25 days, with just a few calls…and a few whatsapp messages.

Key Metrics for Startups on Marketing, Sales and Customer Success #SaaSx

Most of the metrics we are going to see here will sound obvious but I’ve seen even some matured companies do not actively follow it. In a startup company discipline becomes very crucial, keeping things simple and measurable helps a lot. There are more complex metrics like Customer Acquisition cost (CAC), Lifetime value of the customer (LTV), Average revenue per customer (ARPA) etc, but I feel it’s better to have basics correct before complicating it too much.

Marketing Metric

  • Lead Quota
  • Cost of Lead Acquisition

Lead Quota: One of the common mistakes I’ve done in early stages is not setting up a lead quota for the digital marketing team. We simply allocated a monthly budget and not actively measured exactly how many leads we have generate for that month. The goal of marketing team should be increasing the number of leads (quality) we receive every month. If we can measure just this one metric then the other metrics become irrelevant from a top management perspective, example volume of visitors to the website.  The number of visitors to the site really doesn’t matter, it’s the quality of conversion that matters. This will push the marketing guy to look deep into finding new channels, tuning the existing channels, A/B testing the landing pages etc to increase the lead quota.

Cost of Lead Acquisition, this becomes the second part. How much money are we spending each month to acquire X number of leads? In an ideal situation, we wanted to generate a maximum number of leads from the minimum amount spend. Once you have a baseline number say for example 200 leads cost $20k, the cost of lead acquisition is $100 then we can push on optimizing it and bringing the expense down or increase the budget and hence the lead quota. One of the major problems in the digital marketing is if you are not careful it’s literally throwing money in the fire. PPC platforms like Google, LinkedIn, Facebook etc will all just observe it as much as you throw at them.

  • Sales Quota

Sales Quota – also termed as revenue generated per SDR (sales development rep). This will hugely vary from startup to startup, most likely in the range of $2k-$3k MRR (monthly recurring revenue) in a typical SaaS startup. It’s important to balance out the number of leads required for the SDR to achieve the assigned sales quota. The number of leads that can be handled by an SDR will be industry specific, in a B2B long tail sales pipeline typically a 1 or 2 quality lead per day is a good number, whereas in a short sales cycle SaaS startups it can go up to 8 per day. Don’t go beyond this, it’s practically impossible for the SDR to handle since you also need to consider the backlog follow-ups that add up quickly.

Customer Success Metric

  • Expansion Revenue
  • Churns

Once your SaaS startup gets enough traction and you have a handful of customers, it’s important to set up a Customer Success team to make sure the existing customers are happy and address their concerns as soon as possible before they become unhappy and start looking for alternate solutions. The startup founder should give as much importance to customer success as marketing and sales team. I’ve seen companies focusing purely on acquiring new customers and not paying attention to churns, if you think the amount of effort gone into acquiring those customers, it’s become vital to preserve them. It’s 5 times harder to acquire a new customer.

Expansion Revenue is the revenue that gets generated from existing customers. Ex: If you are help desk product,  the expansion revenue is the additional revenue generated by existing customer either buying more agents or moving all of their agents to higher tiers.  This could be one rewarding metric for CS team.

Churns: The goal of the customer success team should be predominantly reducing the churns, and any expansion revenue they generate is a bonus. The culture of the team shouldn’t be set for increasing the revenue, rather it should be set for pure customer happiness and reduce the churns.

You can monitor the expansion revenue and churns as metrics for customer success teams.

Guest Post by Saravana Kumar, Biztalk360 from SaaSx4

India SaaS Survey 2016 – Decoding our SaaS industry

Strength of a industry is not just judged by how much it contributes to the economy. There are a number of factors to consider and surveys play a major role in painting a clear picture.

The India SaaS Survey is all about getting the pulse of the burgeoning SaaS ecosystem in our country. A survey of this kind is indispensable in drawing an insightful analysis and in getting credible benchmarking data about how the industry is shaping out. Though nascent, the SaaS industry has a lot of potential. The data from the survey is useful not only to help entrepreneurs and investors but also showcases the prospect of the industry to technically sound aspirants looking to step into the industry.

Signal Hill, India’s largest software investment banking advisory practice in partnership with iSPIRT, the Indian Software Product Industry Round Table decided to conduct the India SaaS Survey last year. In their commitment to refreshing results of the survey annually, the second edition took shape. The learnings of the first edition has made the second iteration a better fit to the cause.

iSPIRT puts the number of respondents who took the survey at 10% of the entire SaaS ecosystem in India!

This sizable sample size with variation ranging from bootstrapping startups to the biggest names in the industry is what sets it apart from the rest. As the SaaS ecosystem in India continues to grow, participation is bound to further increase and India SaaS survey would be the benchmark.

Image credits to The Economic times

Here are the 7 key takeaways of the India SaaS Survey 2016:

  1. NCR has moved up three places to the second position and established itself as the latest hotspot for SaaS companies
  2. Vertical focussed SaaS players occupy majority share of the scaled and funded respondent pie
  3. Enterprise focussed clients have reported higher median growth rates compared to SMB/SME focussed players
  4. Though inside sales is by far the most preferred and effective sales channel, post the $1Mn ARR mark respondents do report an increased usage of feet on street (which is still #2 after inside sales)
  5. ‘Try and Buy’ is the most preferred sales model (vs. sales channel)
  6. Horizontal and Vertical SaaS players report similar median growth rates, however companies that focus on the US as their primary market (as against India or Asia) reported distinctively higher median growth rates
  7. The median CAC payback period (for >$1Mn ARR) is 6-12 months

Do have a look at all the data we dissect with the survey:


We are open to your suggestions to make this survey better with time. Please do let us know what else you would love to see us cover next time. Write to us at indiasaassurvey(at)signalhill.in

On behalf of Signal Hill & iSPIRT Team

Nishant & Varun(SignalHill), Krish(ChargeBee) & Suresh(KiSSFlow)

Survival is not enough if you are a SaaS founder in India

In an explosive SaaS market with entries from all over the world, survival is not enough. “Survival is not Enough” is the theme of #SaaSx4, scheduled for 17th March in Chennai, and like last time we are heading to the beach. 🙂

SaaSx is a community for SaaS founders by SaaS founders, so if you are just contemplating starting a SaaS business, this event is not for you. This is the 4th edition of the event where all the SaaS founders come together to share notes, network and go back with a lot of lessons.

SaaSx4 home

Take a look at the previous editions here where founders have shared their learnings and also had lots of fun.

Here’s a sneak peek into what’s in store for you (some of these are subject to change):

  • We’ll start with an Unconference session on “Getting the basics right: Right problem, Right market”. This session will help those on the quest for the right product-market fit, and how to get there quickly and efficiently. Experts who have been there will share their stories of how they set the right foundation for their growth. This is meant for folks who are in the early stages of their SaaS journey.
  • For SaaS founders who have crossed $1MN in ARR, we have a Org/Growth teardown for 5-8 growth stage startups. This is a closed door session and you will need to get an invite after your registration is confirmed. If you don’t hear from us then please assume we couldn’t accommodate you.
  • If there is enough interest and companies in the range of $300k-1M, we might run a Metrics workshop on the cards.
  • Like last time, we will have Product Tear Down sessions where 3 founders will get an opportunity to talk about their product and get feedback. Take a look at the previous edition to see what it is like. This is a great opportunity for new startups to have their product analysed by an expert panel from various angles such as opportunity, UI/UX, funding, etc.
  • If you are wondering “How do I make Biryani, i.e. building a differentiated product?”, we are also planning a session to list popular examples and tear them down by “aspects of differentiation and moat”. We’ll discuss the “Aha” factors of your SaaS product and will also do a Biryani teardown for startups that have crossed $300k ARR.
  • We will have a dedicated session on “What is the right org/model that needs to be put together for diff types of SaaS biz”…Our community has been buzzing with many such questions lately and SaaSx3 might be a great way to address some of the questions here.

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Apart from these sessions, you will have ample opportunities to network with some of the leading SaaS founders from India. If you are coming from Bangalore, the sessions start right from the bus!

We only have seats for 150 founders, and we’ll have to give a heavy-hearted “no” to lots of disappointed people!
If you would like to be part of this, reserve your slot right away!

Register now if you would like to be a part of this fun-filled, unconference!

See you in Chennai soon and let’s get high on SaaS!

A Framework For Building SaaS Products That Don’t Churn

When you say “reduce SaaS churn”, most people will immediately imagine tactics like drip email campaigns, great onboarding, customer marketing, gamification and automated alerts when users show signs of leaving. But this post is not about tactics. This post recognizes that users are smarter than any of the cute tricks we can come up with, and it attempts to get to the core of why there are some products that business users keep paying for, and others they discard.

A Framework For Building SaaS Products That Don’t Churn

If you’re a founder or product manager, I’ll encourage you to think deeply about this stuff, versus thinking about your next “growth hack”.

Products on which company processes are based

There are products on which organizational functions are dependent and processes are built. These are usually CRMs, Marketing Automation, HR software and Support software. The defining features are

  • they’re used by decision makers for reporting purposes and are often used to track teams’ KPIs and goals
  • they’re used to run day-to-day functions of the team and organization, for example, the process of applying for and approving employee leaves, or changing the stage of a sales opportunity
  • some people are logged in to the system during their entire working day
  • others log in once in a while to complete certain tasks
  • the system collects and retains valuable data that companies are not comfortable losing

Some observations about these products are

  • the sales cycles are usually longer than a month
  • customers will rarely buy these products without first being sure of the processes that are dependent on them
  • they need extensive API support and data integrations, because the data they collect becomes more valuable once combined with other data
  • heavy cross-functional training is required after the sale, and the product takes the blame if a customer org. doesn’t adopt and use it to the best of its capability
  • you need a lot of quality documentation so that you’re not overburdened with support tickets

An important note about products used by decision makers

When I started out at VWO a few years ago, the most important metrics were “free-trial signups” and “paid customers” (about 95% were self-service monthly subscriptions). Back then, Google Analytics (GA) was our most important source of data. We recorded free-trial signups, upgrades to a paid subscription and revenue in GA so it was what we looked at everyday.

In the past couple of years, we’ve started serving more mid-market and enterprise customers. Because of this, a few things have changed:

  • The average deal size has increased from $x00 to $x0000
  • The quality of free-trial signups matters as much as the quantity
  • A large amount of revenue comes from payments made through bank-transfers and other offline methods
  • “New MRR” is now more important than “new customers”

Because of all these changes, Google Analytics isn’t important anymore. Instead, the big decision are made after looking at reports in the CRM and our database, where all lead/deal/customer/revenue data sits. Through this shift I observed how when businesses evolve, the metrics that matter to them change, and this has a domino effect on the SaaS products that fall in and out of favor.

Now here’s another interesting anecdote: VWO has a large number of ecommerce customers. For the majority of these businesses, Google Analytics is the “source of truth”, so we simply had to build an integration with GA. In fact, we once lost a big customer because their VWO test reports didn’t agree with their GA data (completely possible and for good reasons, read this to understand why). The internal VWO champion tried to fight it out and explain the difference to management, but we lost the customer after some time.

So my point is this… it is well worth your while to build capabilities that will be used to make the important decisions, and if that’s not possible, then align your product with the primary reporting tool used by your target market.

Products that give results with minimal effort after initial setup

Some of these are:

  • Lead generation pop-ups, sidebars
  • Landing page software (specially when tied to on-going PPC campaigns or SEO keywords)
  • Retargeting software, like Perfect Audience and AdRoll
  • Exit intent pop-ups, almost always tied to lead generation
  • Personalization and behavioral targeting
  • Email automation like Vero and Intercom

While you’re building a product that keeps producing results with minimal interference, give a thought to how you can add public branding for that little bit of ‘virality’.

It’s also important to note that products tied to performance will quickly be removed when that performance isn’t enough. In this case, the product itself may be great, but it is dependent on something else working. For example, landing page software gets abandoned when the Adwords campaigns it was used for aren’t working out.

Products that monitor and provide reports and alerts on a recurring basis without needing additional effort

Few that come to mind are

  • Mention (social mention tracking, we’ve had it on for at least a couple years… rarely log in but open almost every daily email report)
  • Server Density (server monitoring)
  • SEOKeywordRanking (SEO keyword rank tracking; old school interface and not updated in a long time, but am sure its creator Will Reinhardt doesn’t need to work anymore)

While building your product, talk to users about the data they find most useful and want to look at everyday, or see what parts of your reports are accessed most often, then send that data out as daily/weekly emails. It becomes a part of users’ morning routine to check the emails and note/discuss/alert if something’s going right or wrong.

Products that enable data flow between different systems

Think Zapier, PipeMonk, Jitterbit and Informatica. Admittedly, data integration is more of an enterprise problem, but the good thing is that once put in, they’re very difficult to remove. That’s because they’re usually implemented after someone high enough has identified the need to have all the various data silos talking to each other, and that robust decisions can’t be made without a complete picture of the issue at hand.

Case study: Hubspot
  • Processes are based around the product? Yes, for marketing and sales
  • There’s someone almost always logged in? Yes, marketing
  • Managers use the product to report on performance? Yes, primarily marketing qualified leads, then customers and revenue
  • Product collects and retains valuable data that customers are not comfortable losing? Yes
  • Has components that produce results without needing on-going effort? Yes, lead-gen landing pages, website personalization, automated rule-based emails
  • Components that monitor and alert automatically? Yes, primarily alerts to sales owners about lead activity, and other alerts around social media, monthly/quarterly goals, etc.
  • Components that enable data flow between different systems? A well maintained and documented Salesforce connector, otherwise they have a platform for developers

As you can see, Hubspot is doing pretty well in minimizing churn. It seems to me that would be the case with most large, successful SaaS products. In fact, understanding the reasons why organizations keep paying for products is why large successful software are large and successful, as compared to just large.

I hope you’re able to use this post as a framework to think about what makes products stick, and apply those principles to the products you’re managing or building. Also, do you have anything else I can add to this? For some reason it seems to me the list is incomplete.

Guest Post by Siddharth Deswal, Lead Marketing at VWO.

#SaaSx3 has made a huge difference for Syscon.

Step-by-step secrets of deciphering the digital world.

We are an ERP product company. Our ERP solution, Syscon Cronus is targeted for manufacturing industries. We have all along for the last 20 years were been following traditional marketing route, out-bound. Though being an IT company, may be due to my manufacturing background and our Customers are from the same segment, we never put our stake in digital marketing. We always believed in Outbound rather than Inbound marketing.

SaaS x3 has completely changed my perspective. It was such a power packed digital Sales event. But the real beauty was the way it was structured. Every step was explained in detail that a dummy like was able to understand and implement it.

I really would thank the great guys like Girish, Suresh Sambandam, Pallav Nadhani & Shekhar Kirani who had taken their time-out and make it a point to hand-hold the eco system. Also wish to put my learning as a gesture to them, though many of this information will be available in a much better way in public domain.

Basics of Digital Marketing

Google Adwords:

Efforts:

  • It is all google Adwords, Analytics.
  • If google does not have a category for your business better do not waste your time (or) you can still run your business a life style one.
  • Having identified your business category, Google might provide its key words suggestion. Make sure that you pick the generic ones.
  • Also spend time in identifying your own key words. After the key words are just the way you think that your customers are searching for your product or service.
  • It may not be wise to use the competitors name / brand as your key words. It may fetch more as impressions and clicks but may not conversions.
  • Make sure that you remove the negative key words at least once a week.
  • You have to spend money on Adwords and but decide how much is feasible for you.

Results: In last 2 months we have generated close to 25 inbound enquiries and closed 4 orders

Website:

Efforts:

  • The first day after completing the above the bounce rate of my website was 99.9%. I never scored good marks in my education and I was happy to see that at least my website was doing better.
  • Later I came to know that it is real bad news for the bounce rate being high.
  • What is bounce rate? Bounce rate is an indicator that shows as to how long the visitor spent time on your site.
  • We then spent time in fine tuning the site performance of home page and other page information.
  • We have recruited a full time digital marketing guy who worked on SEO. After 2 months you know now the bounce rate is between 2 – 6%
  • Most important learning was, Call for Action (CFA). When a visitor comes to your site what you want them to do. So the first image in your site has to tell what you do and now what you want them to do. If this is not addresses well traffic will not lead to conversion.

Results: The bounce rate has reduced from 99% to 5 % which has resulted in 70% increase in organic traffic.

Content on Social media

Efforts:

  • It is important that you need to write original interesting content about your product and business.
  • Earlier I use to write articles in Linkedin. But I never thought that it was to be connected to my site. Now I post 3/4 of the article and for balance article it is linked to our site.
  • Presence in Twitter, Facebook and Linkedin is important.
  • We have been making at least 2 posts per week.

Results: This has created traffic from social media 40%.

Make the Customer as your marketing engine.

Effort:

Pallav’s presentation was so impressive. Soon after the event, we have implemented one small thing. In all outbound documents like Invoice, Purchase order, Offer etc., we have just added in the right bottom “Powered by Syscon Cronus” This was delivered with our latest patch.

Result: We have already received 4 enquiries through this.

The product tear down session by Suresh Sambandam was too good and very detail in highlighting the missing parts of our website from the visitor / prospective client perspective.

But the $1 million to $5 million was an ultimate-one by Girish – Freshdesk. In today’s dirty world, no one wish to give out so much of critical business information. I could also see the openness of the Investor – Shekhar Kirani, Accel Partners.

After this SaaS X3, our business dynamics has completely changed. All of us have developed detail eyes in the company. With so much of activity even our development and testing teams have become more agile. Every time when we make a new version release, there will be at least 1 or 2 critical bugs and 5 -6 non-critical bugs. But surprisingly, this time there were no bugs. Our team has become more conscious.

I wish to thank each and every one behind SaaSX, especially to Girish Mathrubootham, Suresh Sambandam, Pallav Nadhani & Shekhar Kirani for their self-less efforts in creating strong SaaS eco system.

Good karma by iSPIRT

Contributed By S.Vijay Venkatesh – CEO, Syscon Solutions Private limited, Hyderabad

Getting Marketing basics Right (for First Timers) by Pallav Nadhani, FusionCharts #SaaSx3

Marketing for beginners
The morning of the SaaSx3, saw a round table by Pallav Nadhani, CEO of Fusion Charts.
And I was one of the few lucky people who managed to find a seat at this already cramped round table.

PallavatSaaSx
Pallav, kick-started the session with a question:

Who are you & what will the world miss if your company dies in 10 years?

The question (although slightly morbid) did its trick.
It gave us an idea of what we had in store for the rest of the RT and beautifully set the context for what we could expect. And what we had to do if we had to market a product.

Interspersed with quirky humour, anecdotes, and important questions to ponder, the session was definitely interesting and novel.
Here are some key takeaways:

Aligning Product with Marketing

We usually talk about our product, our goal as a company. But Pallav stressed on the importance of flipping the question and address the problems of the customer.

It’s only when marketing defines product, will the product shape into an answer for the customer’s problems. And you’ll be building something that customers will get value out of.

He asked us to put a “why” to the problem that we were trying to solve for our customers.

An example he cited from some big companies that asked this question:

“Why shouldn’t you have access to your files, whenever/wherever you want?” was Dropbox’s question before they started building their product. Similarly, ask yourself that “why” to the problem you’re trying to solve.
Quoting Simon Sinek’s TED Talk on the Golden circle, Pallav went on to discuss the important questions of the purpose, the process and the result
– Who to reach
– When to reach
– How to reach

Who to reach?

Identify the three personas you have to sell to: Influencer, buyer and user
Depending on the nature of your product, decide who has to be engaged to ensure you’re able to sell to them.
Figure out “Why” should that person use your product? Everybody has a different reason, but what’s that persona’s reason?

If you’re asking somebody to switch from an existing product to a new one, how seamless is migrating? If it’s a new product, how will you sell him the need?

Tip: Ensure you’re asking the same “why” as your customers. Pallav cited an example here. Every time there’s a new download, they send an email to the customer asking the purpose behind the download. This way, they made sure that they were delivering on what customers expect from them.

When to reach?
Collect as much information on your customer (in a non-stalky way, of course!). The information should include the information that they consume on a daily basis, and how do they consume it. And how do you make sure you are in those media, so as to make an impression?

Pallav's RT at SaaSx
A classic example of this that he quoted was the billboards. He asked us to recollect some of the latest billboards, and then tried to delve into the reason behind it. We discovered that we see the billboards that we choose to see. If you’re hungry, you remember a restaurant’s board, or a car if you’re looking to buy one etc.

Tip: Make sure you actively hit customers that are seeking for your product. Identify where your customers would be, and then hang around to make an impression.

How to reach?
We discussed various ways of doing the actual marketing here.

One of the classic marketing strategies is The Sniper Approach vs Carpet Bombing approach to marketing.
Swearing by the sniper approach to marketing, Pallav said that, rather than trying a wide casting net approach with different experiments, try a laser-focused activity with precision, to ensure you nail the sell!

And the only way to do this would be to, Know your user, see if you understand a DILO (Day In the Life Of) your customer (creepy, but highly insightful) and see how you can fit into the picture.

Also, can you partner with someone to push your product? Or can you poach any partners of your competitors?
Tip: Unless you discover who you are, and why you exist, nothing can help you explain it to your customers.

Here’s a quick summary of all the major points:

  • Find that key problem that you’re trying to address and make it your goal.
  • Identify your ideal user & study the various personas.
  • Now ensure you “marry” the your goals to the user’s needs.
  • Work towards creating an experience, so your prospects take action.
  • Collect as much information as possible on your customer, so you know when and how to hit them with your product.

Happy Marketing!

Scaling from $1m to $5m, lessons learned by Freshdesk

I travel to India once every quarter to catch up with our India team based out of Coimbatore. I was planning to attend SaaSx for a while now and this time, it was perfect timing the event is scheduled on 2nd April, right in the mid weekend of my India trip. This is an invitation-only event, I’m thankful for the organiser to get me involved. With 200 attendees where the majority of them are founders and key people in some of the promising and growing companies on the Indian start-up eco-system, you can sum up the experience in a single word it’s “awesome”. Even though there were lots of sessions, round-table playbooks, product tear-down analysis, countless conversations we had between founders during the event, the one session by Girish from Freshdesk stood out and made everyone speechless. I wanted to highlight more about it here.

When Girish assembled his sales/marketing team on the stage and opened up the statement, please do not share anything I speak on this stage outside this room, and we need to get investors approval to reveal this data, I know something interesting is going to happen. It was kind of nostalgic moment for me, I heard a similar sentence from Peldi from Balsamiq when he opened his speech at Business of Software at Boston last year and that session turned out into one of the best sessions of BoS 2015 (Rookie CEO Grows Up. Reluctantly).

In that session, Peldi literally opened up some of the confidential emails he had with possible acquisition offers, the conversations he had with his team, and how they boldly stood against the offer etc. Girish did something similar down the lines showing the real reports he was sending to the investors, with some key metrics like revenue targets, projections, the goals they were setting for the sales team, how they aligned the marketing and sales team to work together, different experiments they were doing with several revenue channels, how they drop some non-performing channels, and so on. To respect the confidentiality of the subject I’m not going to go into the detail, but cover some interesting general topic Girish highlighted.

Everyone needs inspiration, most of the founders read tons of books, blogs, magazines etc (I haven’t met a single founder who said I never read any books). The problem is to get a single actionable item from reading a book takes hours and weeks, still you won’t be sure and just need to experiment and find it. But what Freshdesk team has shared is real data that took them from $1m to $5m in annual recurring revenue (ARR), which is priceless (note: the $5m is not their latest number). Every slide they shared had something for me to take away and I believe that’s the case for everyone.

I have known Girish personally for few years now and he is a kind of person who goes with the gut feeling and figure out what’s happening. I’ve captured some of his best statements during his presentation “Do best of your potential and you’ll eventually end up somewhere higher up”. This is such a true statement, you set your vision on $5m ARR and align you sales/marketing team towards that goal, and work backwards. Even if you don’t achieve $5m, for sure you are going to end up somewhere higher up than where you are right now.


The second best statement is on utilising the talent in the right way “Don’t try to put something into people, what god intentionally left out”, this is not the first time I’ve heard Girish saying this but this is something worth repeating. To give you a better analogy, if you take Sachin Tendulkar and ask him to do wicket keeping and complain he is not performing well, whose problem is it? Is it Sachin Tendulkar’s or the selectors? Same for start-up founders, understand the real potential of your team (team member) and place them in right places. Jim Collins highlighted this in his popular book “Good to Great”, it’s not just about getting the right people on the bus, and it’s also about setting them in the right places for you to be successful.

When it comes to pricing, Freshdesk made couple of important pricing changes during their journey, first one is introducing the expensive Estate plan (that time) as their last tier, they figured out people are always reluctant to buy the last tier, even if it has some interesting features, it’s more of psychological thing, and they figured out n-1 tier performs better, hence, they introduced the Estate plan with just gamification, the intention is not to push and sell this plan, but to sell the n-1 tier the “Garden” plan. They also made some important pricing decisions on how they structure their free offer. Previously it was 1 free agent on any tier, and they moved it into 3 agents free for life. There are a couple of key factors in this decision if there is only one person doing support then there is no necessity for a help desk system, and also, they are throwing away free agent license on each tier which the customer would have bought anyway. The key takeaway for me in this is when designing the free tier, make sure it’s useful for the people and also it’s aligned with your goal of eventually converting them into paid customer gracefully.

Getting to the unicorn status, the “triple-triple-double-double-double” formula. Girish highlighted this article from Techcrunch “The SaaS Adventure” during his talk as one of the influential blog that helped him to set the target of growing from $1 to $5m. The article explains how you scale to unicorn status, what are the benchmark numbers to hit. It’s $2m > $6m > $18m > $36m > $72m > $144m (i.e. triple-triple-double-double-double). If you need to be listed as the unicorn, then the magic number to hit is $144m ARR.

The other important information he shared is finding the magic number of leads for each sales person. At the early days, each sales person at Freshdesk were handling at an average of 800+ leads per month, which of course is not efficient. In order to fight against time, they were using automated email sequences to improve the lead quality. Girish accidentally bumped into this article from Hubspot “CREATING A SALES PROCESS FOR YOUR INBOUND LEADS: 150 IS A MAGIC NUMBER” where they discuss in detail about the magic number for a number of leads a sales person can optimally handle i.e 150 per SDR, and they scaled the sales team accordingly.

A little bit about customer success team, it’s very important to set up a customer success team as soon as possible to avoid churns. Most of you might know the leaking bucket analogy, if you have holes in your bucket, where your customers are churning regularly, then you’ll be constantly fighting against filling the bucket to maintain the level instead of growing. In a lot of companies it will be a bit late when you realise it, when you call a customer who has already left you, it’s way too late. They might have already set-up a system from your competitor, and you need to sit and wait to hope they won’t like the competitor’s product. Freshdesk has done similar mistakes in the past and now they have the process in place to avoid it.

Even though this article would have given you some interesting tips shared by Girish and Freshdesk team, there is no alternate to hearing directly from horse’s mouth. With the great sense of humour in his speech and ability to instantaneously crack jokes on stage, I thoroughly enjoyed the session, noted down some key tasks and set myself a target where I wanted to take BizTalk360 by the end of this year.

In the future if you get a chance to attend one of the SaaSx events, don’t miss it.

Guest Post by Saravana Kumar, BizTalk360

Hey Indian SaaS Founders, Are you dreaming big enough and aiming high enough?

I took SaaSy bus to attend SaaSx3, a fun journey networking and ice break session among SaaS founder The sessions were on common challenges from funding to hiring right resources and also instant mini FinTech RoundTable (picture below).

SaasybusThe venue was at Chennai (Mahabalipuram) well described by above tweet and event started with afternoon session by Pallav Nadhani of FusionCharts on Referral Marketing. The discussion started emphasizing needs of marketing starts before existence of the product and continues with product and marketing should not be looked in silos away from the product. One question for SaaS founders is whether their startups are geared to leverage product features to perform self-marketing of the product The session brought some real examples of SaaS firms who have already done this successfully.

The impact of using “Powered by Logo” inside your product features on B2B2C websites that are focused on end user was highlighted and is more effective to target customers from new geographies where your product has not been adopted and are in early stages of entering new geography.

Nemesh of appointy stressed importance of backlinks (two lines of codes in the product), that became part of Google search when someone searched for a tool for appointments. Other suggestions include:

  • Sell lower price plan without option to “White label” product offering. After product is adopted, the lowest price plan can be offered as “Free forever plan” without white label option.
  • Find a WordPress plugin that is active and popular. Buy plugin and add one line in this plugin and publish the plugin.

#OneThing session happened where SaaS founders were asked to share a set of one things that creates significant transformation in their startups.

  • We did not predict, we performed action
  • Upgrade Field on Sales approach to Customer Success approach
  • “Support and train customers for first 45 days increased NPS score” – Think of it as customer Success Channel that is needed in scaling stage.
  • Keep high touch with customer and experiment how to maintain high touch with customers being online and not on-site. Leverage and experiment with cloud telephony, gamification and customer management.

Product Tear Down session where SaaS founders offered their product to be teared down by expert SaaS founder and audience. The experience SaaS founders published guideline template based on which they will provide feedback to brave startup like Zipboard and CanvasFlip and here are comments that apply to lot of startups found here too.

  • You first need to go deep focusing on the right customer segment before going broad.
  • While building a branded website, remember that website home page needs to convey emotional, functional and technical aspirations to connect with your audience. One good example is slack website, it is inspirational.
  • While displaying metrics of your product on the website, show metrics that creates positive impression in mind of prospects. Small number may not create right impression.
  • Remove small irritants. Devil is in details.
  • Does your product features pass Tooth Brush test? Ask, ‘Is this something people use once or twice a day and does it solve a problem?’
  • No right or wrong strategies, only shades of right while building startups.

Product-TearDownPeople who teared down choose right words to share comments to the founder who offered his product for tear down, also adding kind words “Do not become defensive. Their inputs are to improve not to criticize”. SaaS founder in the audience really liked the positive impact of product Tear Down session and followed with asks to #ispirit to have more startups in Product Tear Down sessions and suggestion for virtual Product Tear Down session.

There was another #OneThing session focused on what is one thing that in last 12 months worked well for SaaS startup with Aditya Sangi of Hotelogix , moderated by Prasanna

  • Alliance building approach steps – find complimentary product. Check whether your product adds to their value offering and whether other product have efficient reach to your customer target and whether joint offering creates value for your customer base.
  • Do not keep building a lot of non-core features in to your product and make the world as your competition and end up with no partners.

One attraction in SaaSx#n is story style presentation by Girish of #freshdesk, who genuinely shares learnings from his journey. This time the story had movie effect and learnings from the movie are

  • Everything need not be data driven. You can do things that people would notice and they will notice when things are on high quality bar.
  • Do what is right for customers first. Help sales team to develop focus on customer success by incentivizing to help customers first.
  • Started with sales team of young minds fresh from college and they started with focus on number of agents sold rather than revenue of agents sold. Once they were more customer focused and time arrived to scale, a change was implemented in discussion with sales team to change their focus to revenue earned per sales team member.
  • The importance of alignment between marketing and sales using instances from freshdesk journey.
  • Marketing teams must have targets for sign-ups. Pre-Sales team was useful to prepared customers on the product. He referred to article CREATING A SALES PROCESS FOR YOUR INBOUND LEADS: 150 IS A MAGIC NUMBER
  • Hired fresher’s following hack “Hire them for attitude and you can get them skills”. I liked the fact that the hack was implemented in sales and marketing function and not only in engineering.
  • Similar to other startups, freshdesk also got junks as prospects. They pruned not only junk and also channels where hunk data originated from. More junk arrival from channel lead to removing channel, leading to arrive at list of channels that worked for them.

Girish once again demonstrated that he was a hardcore Rajnikanth fan in real life too by creating a real movie style experiences bringing young talent who accompanied him at the start of #freshdesk journey in sales and marketing on to the stage. He created right impression that success is attributed to team’s effort rather than individual effort. Consider to be special in the days of “Winner takes it all”

Girish complete the movie with some thought provoking questions “Are SaaS founders aiming high?”, “Do you want to be happy with small year on year growth?”

Post by G. Srini, volunteer for iSPIRT

Product Teardown at the “SaaS”y Day at Chennai: Chapter 2 on SaaSx3

The sea breeze was cool. And the SaaSy people went cool as well. Kiruba unleashed some tricks for networking that had the participants engaging in banter, fun and games on the lawn. It also wore off the participants from postprandial somnolence (carb coma) after lunch. The SaaSy bus by then had arrived from Bengaluru, and the participant number swelled to 150 or so.

Using your product as a marketing tool

Pallav Nadhani set the theme for #OneThing discussion involving of Siddharth of Practo, Nemesh of Appointy, and Ankit of AdPushup. He cited examples of MailChimp, which sends annual reports about the number of mails sent through its service, and Rancore, a research organisation that sent reports about Share Point, a Microsoft product for developers. He said that research reports set benchmarks for what works. He spoke of referral marketing and commission paid on referrals to existing customers as strategies to acquire customers without much of a marketing spend. Avlesh of WebEngage said that marketing does not exist in silos away the product. He spoke of incorporating the marketing element inside the product itself.

webengageOne strategy is using the “powered by *product logo*” inside the product to attract more prospects. This was especially used in a novel way. WebEngage chose a customer (of course, after a due diligence) to sell its low-priced product in an unpresent geography. Then the logo was added in the product to attract more customers in the region. The customer acquisition cost is reduced as a result. Nemesh of Appointy (which helps businesses to schedule appointments) has 118,000 customers, all of them acquired at zero cost of marketing. This was done through backlinks (two lines of codes in the product), which would indirectly show up in the Google search when someone searched for a tool for appointments. Ankit spoke of four strategies to customer acquisition without much marketing spend.

The VC speak

Mohan from Norwest said the SaaS multiples have compressed in the United States – it’s five times the revenue now rather than the 10x number that was the norm until sometime ago. He also said that SaaS companies have a history of not making a profit but was confident that it is possible to build a profitable SaaS company in India, which is capital-efficient.

Tarun of Matrix Partners clarified that now the focus has shifted to profitability of SaaS companies rather than growth. He said that growth expectations are tempered according to existing market conditions. Now, liquid capital is not available easily. He agreed that there was a time when growth was the focus when the capital was easily available. Now that capital has shrunk, it’s difficult to have a growth at the cost of profit strategy but the one focused on profits is the best.

Tearing down the product

Frictionless sign-up, a clutter-free website and a shortest path to functional wow! are some of the elements of the SaaS product that is self-serving and sold to remote customers. Three products were at the receiving end … er … learning end from Suresh Sambandam of KissFlow, Bharat, head of UX at Freshdesk, and Shekar Kirani of Accel. While Suresh focused on the sign-up aspects, Bharat gave feedback on design whereas Shekar pinpointed the market focus. Zipboard, Hummingbill and Canvas Flip were the three products that were reviewed on stage.

product etear down

This was easily the most popular segment of the day. There was laughter, there were learnings, there were moments of revelation, and on top of it, the three products wouldn’t have received such an honest feedback elsewhere. Shekar’s advice was worth a weight in gold especially for Zipboard and CanvasFlip. He was laser sharp in identifying the right customer segment and market and the entrepreneurs in the audience were overawed by his clarity.

The audience felt that Product Teardown deserves to be expanded in future editions of SaaSx. Peer feedback is valuable and helps to refine the product to make it efficient to acquire more customers.

The grand finale of the day was Girish making a fantastic presentation on his journey – from $1 million to $5 million. At each stage in the presentation, he called in the team members who worked on identifying a specific problem and explained what worked and what didn’t. What came through was the endeavour that propelled everyone at Freshdesk to work towards a common goal. What made these young guys work like men (and women) possessed is the specialty of the Freshdesk culture. Not much detail can be revealed, as we have to respect the fact that Freshdesk is a funded company. But what Girish said at cocktail was taut: “When I am on stage, if some guy thinks if he can do it, I can also do it, I am happy about it” It is suffice to say those who were at the hall were pumped with inspiration by Girish to think big and if you need that, you have to make it to SaaSx. See you there!

It Was a “SaaS”y Day at Chennai: Chapter 1#SaaSx3

The April sun wasn’t evident at the beach side locale, near the historic town of Mamallapuram, which hold relics of exceptional beauty on its rocks sculpted under the patronage of the Pallava kings. Had it been the early part of last century, in all probability, we could have reached this place in passenger boats sailing through the Buckingham Canal, now condemned to history. It was using this canal route that the national poet Subramanya Bharatiar escaped to Pondicherry to prevent an imminent arrest by the British to endow us with memorable literary gifts in Tamil.

By favourable alignment of choicest factors, Chennai is home to successful SaaS enterprises. To say SaaS is the preserve of Chennai is surely an overstatement. To put it in perspective, it is a worldwide phenomenon and Chennai has made a mark in India. Undoubtedly, the success of Girish Mathrubootham (Freshdesk) has a lot to do with Chennai hailed as the SaaS capital of India, with Suresh Sambandam (KissFlow), Sanjay Parthasarathy (Indix), Krish Subramanian (Chargebee) and Lux (Unmetric) in the elite SaaS league giving an aura to Chennai, not to forget that it was Zoho that made it to the big SaaS league, taking on Salesforce, from Chennai.

At SaaSx3 it was a day filled with peer-to-peer learning, some fun, and a super-duper end. Playbook roundtables, One Thing Series, Product Teardown, and a presentation of “superscaling” (my term!) by Girish as the grand finale completed the agenda. Pallav Nadhani of Fusion Charts and Krish Subramanian of Chargebee (in partnership with Suresh Sambandam of KissFlow) engaged select SaaS startups on a roundtable each. iSPIRT’s agenda of peer-to-peer learning and networking, with the intention of forming a vibrant community of product entrepreneurs, took the form of playbook roundtables where the successful entrepreneurs share the secret of their product success with the product startups. The focus of both the roundtables, where I spent some time in each, was on the product. While Krish focused on taking the product from 0 to $1 million, Pallav chose the marketing as a tool for product’s success.

Find out why the customer chooses your product

Krish spent a considerable time in explaining the key to product success – understanding the persona of the buyer. “Product-market fit is constantly evolving,” he said. The process doesn’t stop with customer acquisition and onboarding but continues with retention of the customer, on what is now called the customer success. Acquiring the customer is a tedious process for which several methods and processes come in handy. The important take-away from this session was understanding the customer’s intent to buy the product. Krish liberally quoted from Chargebee’s experience to explain his perspective – their assumption of why the customer bought Chargebee flipped on its head when they saw the real data on why they did. How to find out? It is best to ask – first through a non-intrusive e-mail followed up by conversations and further e-mail exchanges.

The whole point of the discussion hovered around the 10% conversion rate – of prospects into buyers. But Suresh clarified that it is a benchmark for large enterprises, but the real numbers that convert is the key rather than the percentage if the customers are SMBs.

Krish said that the choice between free trial vs freemium is loaded in favour of freemium. But what usually happens is that the free trial users pump up the numbers (the customer count) but largely the free trial customers don’t turn buyers. The truth is freemium works well but free trial also works. The real answer is it all depends on the product. What also works is adding a “powered by *product logo*.” This has worked WebEngage and Freshdesk. WebEngage had a “powered by *logo*” on its product design (for a cheaper priced version) so that it gets more prospects into the funnel. If the customer is not paying, at least he can be used as a channel for prospecting. Freshdesk used the “powered by *logo*” on all its customer support e-mails (which is actually generated by Freshdesk) sent by the free user in its forever free product.

Another important aspect touched upon was making the pricing transparent and known, especially if the target customers are SMBs in the case of self-servicing SaaS products. If the customer base is large enterprises, the price conversation can happen offline and it is not necessary to provide price information on the website.

Constantly evaluate your customers and look for influencers

When I entered the conversation, Pallav was focusing on why, how and what of the product. He defined customer cohorts as influencers, buyers and users. Pallav’s proposition was a lot deeper – a good product markets itself. But you also ask deeper questions – even the reason why you (your product) exist to answer the other defining aspects of why the product sells (Pallav’s recommendation: view Simon Sinek’s Golden Circle video on why, how, what). The why exists converts simply into what problem is the product solving. But identifying the customer is a continuous evaluation process. Only if you know why you exist can you target the most appropriate buyers for your product so that your solution is aligned to their needs. For targeting customers at the right time, you must understand the customer behaviour a bit deeply. Pallav gave examples of how customer habits can be known from data. His marketing pitch was a bit philosophical quoting Seth Godin, who said, “The valuable forms of marketing are consumed voluntarily” (read Three Changes of Marketing). The network effect is powerful, as Avilesh Singh of WebEngage explained using his product marketing strategy. He said how changing his focus from marketing execs to developers as customers reaped rich dividends.

But, beyond all this, remember the most essential aspect is the product itself, which should be flawless from the customer experience point of view. Then other aspects are built on top of it.

SaaSx3 2016: Sun. Water. Sands and Conversations!

You work hard all year long to ensure your businesses become successful or stay successful, but everyone needs a break to relax and reflect. Don’t feel guilty about heading to the beach this summer. It’s that time of the year when the league of the eXtraordinary SaaS hackers meet. Yes, you read it right! SaaSx3 is here in Chennai once again.

SaaSx has been making waves every year and this time, it’s by the bay, on the 2nd april 2016 at Ideal Beach Resort, Chennai. Who says you can’t have focussed discussions in a session that takes place under the open sky? There is something ethereal about the waves of the sea. I believe, that there’s no other perfect environment for learning, deep contemplation and a chilled-out time with the leading thinkers of the Indian startup ecosystem.

 

In its 3rd year, SaaSx3 is a lively mix of startup founders and  entrepreneurs from all over India coming together to celebrate entrepreneurship. This brainchild of iSPIRT is a steadily growing movement, that aims to facilitate a community for Indian entrepreneurs to nurture great relationships.

This year, SaaSx3 assembly is impressive. With a tightly curated guest-list, it’s one great opportunity to:

Be mentored by proven leaders from the startup ecosystem
Discuss and share  what’s hot in SaaS market
Exchange ideas with peers
And of course! networking too!  I can’t wait to experience the unconference vibe –just a perfect way to loosen up relax and learn.

They say, each wave is different, and so is every entrepreneur’s experience. To become a great surfer, one does not have to wait to ride the perfect wave. Don’t keep yourselves at bay,  save the dates . Meet you at SaaSx3 to  listen to those adventurous tales of incredible startups!

 

3 Years of Volunteering to enable hundreds of experiments to blossom

AnHRA0C0tF4mI0qO-9WAwf-AXl383SqEDMGC9He_wzNoOn Saturday, I was going to attend 3rd year anniversary event of iSPIRT On the way on my bus to meeting, my mind was filled with varied thoughts about 2010 or earlier, when I was outsourced product start-up employee. Looks like little time ago, 6 years has passed from 2010 when I met the volunteers of NPC. Sharing comments to volunteers (Avinash, Rajan, Vijay, Manju, Suresh) on lack of “Made in India” products, I learnt that their thoughts were similar and more advanced. In addition, while I was talking, they had larger dream to create ecosystem where tech geeks are proud of creating products and the first baby step to create pride to come with products was NPC event.

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For a regular visitor in technical meetups of BLR and volunteer for education and health activities in the weekends, their volunteering style spoke more about the volunteer’s real intent. More interaction made me realize that contribution mattered more than the person’s experience or position. This was firs time I heard people work selflessly as part of industry forum and became curious to understand their concept better, leading to a sense of respect for volunteers, motivating myself to volunteer for NPC 2013. In 2013, iSPIRT was formed as new initiative with focus to create a product nation and volunteers drive the vision of iSPIRT. Today, I continue to see the volunteering spirt even today to be similar or better than my experience in early 2010. Hence I have planned to spend whole day to attend 3 In 2013, iSPIRT was formed as new initiative with focus to create a product nation and volunteers drive the vision of iSPIRT. Today, I continue to see the volunteering spirt even today to be similar or better than my experience in early 2010. Hence I have planned to spend whole day to attend 3rd year anniversary function of iSpirit. This blog represents what I learnt about growth of iSPIRT in 3 years. When the first session on “PlayBooks” started, I started to recall that iSPIRT had started to offer Playbooks as first learning program. Playbooks used to represent all programs offered to start-up entrepreneurs. Targeted entrepreneurs on application were invited to participate in playbooks based on specific stage of their start-up. Being in the ecosystem, I am aware of

      • All programs and events are free for participants. Participants apply to attend program or event with details about their startup and applicant registration is approved based on their suitability to programs theme and approved participants attend event for free.

 

 

    • Programs and events focus to impart learning for a category of start-ups that are present in specific stage of their journey namely start-up enthusiasts, Discovery, Product Market Fit and finally Scale To Grow.

 

6The session shared that iSPIRT is offering 3 learning programs and 3 knowledge events. I did not realize that I myself have been attending some of these events. I still see absence of programs and events for the Discovery stage yet, difficult and tricky stage to cross.

iSPIRT has come with a matured structure around programs and events termed KASH Playbook Framework. Playbook are no more a program and had become umbrella representation for all programs. What does KASH represents?

  • K – Knowledge
  • A – Attitude (Mindset)
  • S – Skills
  • H – Habit

Been an entrepreneur, I can relate with KASH as learning theme for programs offered to entrepreneur’s because all programs aims to impart entrepreneur to gain knowledge, develop a mindset, learn skills, identify habits and practice the same to empowers entrepreneur in current stage to create/generate KASH leading to transition from current stage to next stage.

First pic - 3 years

My view of RoundTable is to help happy & confused startups with product market to scale business. I learnt RoundTable (K, S) continues to be an informal closed door interaction (~4 hour) among entrepreneurs and practitioners facilitated by saddle entrepreneur to learn tacit knowledge & skill. Roundtable started as first program of iSPIRT in 2013.

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My view of PNGrowth is to help scaled startups with product market fit to grow leaps and bounds. I learnt PNGrowth (A) is 3 day bootcamp to shake up and instill ‘Panga’ Mindset requisite for category leadership, followed by a 1 year community support. The first program was in 2016 at Mysore The 3 learning events Innofest, SaaSx, InTech50 are focused on large participants. My view of Innofest is to help creators to explore possibility to transform their creation/hobby in to business. I attended the first I attended the first Innofest (A) that happened in Aug 2015 in Bangalore and nice to hear the event travelled to Hyderabad. I wish that sure more cities are eager to conduct event to help innovators take pride in their products and show case them, get feedback of their application in reality. This is “No copy paste entrepreneurship”. My view of SaaSx is that new entrants gain insights in to the tribal knowledge of experienced SaaS folks which helps them to make their offering better more efficient. SaaSx(K) event is to create & nurture community of SaaS entrepreneurs in India at the SaaS capital of India – Chennai. The first event happened in Chennai in 2014, followed in 2015, which I attended and can vouch for the fact that SaaS entrepreneur’s shared their deep intimate learning with others. My view of InTech50 is as experiment with difference. Instead of startups working hard to engage and partner with large corporates with their product offerings, can we make corporates to come together and engage with startups and share feedback and evolve in to partnership. Reversing approach of startup Push model to build relationship and engagement to Corporate Pull model.  InTech50 showcases software products created by Indian entrepreneurs, with aim to help software product companies to enter global markets via our network of early adopters, partners, co-innovators and investors. Companies apply and Chosen companies receive advice, on-going mentoring, product marketing support, and funding to scale in the global markets. This program comes with a cost cover expenses for two attendees and event logistics. 13
Another session I focused was on “India Stack: Powering thousands of experiments”. Before jumping to understand India Stack and session contents, it is good to start with some history in India of how absence of legacy era in telecom and internet has become Indian advantage over time. With absence of telecom legacy, India skipped analog era and leapfrog to digital era of STDs, leading to leapfrog to mobile usage. With absence of internet legacy, India skipped PC based internet and had leapfrog to era where internet technology is available to every Indian via mobile (computing device of choice). Look at the money savings for India from not having to spend to build legacy infrastructure that becomes obsolete with advent of new technologies and money goes waste.

This enables every Indian to access and consume service offered by internet software and mobile apps over internet. It is time to dream and create experiments to leverage this leapfrog benefit to enable Indians to leapfrog to make use of digital applications and the Indian government has jumped in to same with Digital India campaign. One see two fundamental changes happening.

  1. Every Indian can access and use mobile apps, with mobile phones in hands of every Indian.
  2. Every Indian is getting used to electronic banking and payments fueled by e-commerce players.

iSPIRT wants to dreams along with Indian government with belief that this is right time that Indian entrepreneur’s need to leverage Digital explosion wave expected in India soon. One can dream in terms of how technology can be leveraged to create financial inclusion, how apps can create positive interventions in areas of education and health care. When you dream, you are motivated with the potential to leapfrog tech-starved Indians to tech- savvy Indian.
12Dreams are ideas to start with. Dreams need to follow with action to reality. For such a dream to happen, iSPIRT has seen itself a role to contribute to seamless working between entrepreneurs and with government agencies and regulators and has started to proactively engage with government. This joint engagement with stakeholders of Indian government enabled iSPIRT to propose 4 recommendation to serve as backbone for Indian government to realize the dream of Digital India.

          • OpenAPI Policy objectives recommended for Digital India programs

 

      • 7 key principles for to be adhered for implementing Digital India programs.

 

      • Technology Stack to serve as baseline for developing apps for Digital India

 

      • India Stack to serve as baseline for implementing Digital India.

 

              iSPIRT has recommended these OpenAPI policy objectives

          1. Software interoperability: APIs are recommended for all e-governance applications and systems, enabling quick and transparent integration across these applications and systems.

 

        • No Government Silos: Information and data shall be shared through a secure and reliable sharing mechanism across various e-Governance applications and systems.

 

        • Data available to public: Make people’s data public. Provide APIs to enable people to view data.

 

        • Baseline guidelines for Implementers Provide guidance to Government Organizations to develop, publish and use these Open APIs

 

  iSPIRT has recommended these 7 key principles to be followed in developing application by government and integration layer with government applications. 3
The 3 learning programs IKEN, RoundTable and PNGrowth are focused on limited participants.

My view of IKEN to help startup enthusiasts aware of challenges to enable self-assess of their strengths and to identify needed self-improvements. I learnt IKEN (S, H) is a 10 weekend boot-camp for early/Novice entrepreneurs and startup enthusiasts and focuses on life skills of an Entrepreneur along with business skills. The first program was created in 2015 in consultation with effectuation with Prof Saras and happened multiple times in Bangalore.

Picture 2 - three years

Based on OpenAPI Policy and guideline principles, here is robust technology stack recommended for creating innovative solutions to India’s hard problems.

Picture 3

With payments being accelerated by regulatory Innovation and a continuous rise of smart phones, here is robust solution stack recommended for developing Digital India applications.

Picture 4

What I liked about iSPIRT is

  • Supporting entrepreneur’s with learning that they need and that is not easily available.
  • Focus to get feedback for their initiatives and working to bring a structure to their work.
  • Contribute by promoting and facilitating the use of IndiaStack creating curiosity and real interest.

If APIs are made open, secure and available for developers (through sandbox), I am sure iSpirt would jump to volunteer to evangelize IndiaStack APIs and promote IndiaStack APIs through Hackathons and developer Events.

To end with, Saturday meeting made me realize that iSpirt has matured from an unstructured volunteer initiative for entrepreneurs and is on the path to become think tank to create product nation.
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Guest Post by G. Srinivasan

SaaSx Chennai Express – Board this Train Now!

I am Amit – running a SaaS venture Interview Mocha, a pre-employment skill testing company. In this blog I am sharing my learning from SaaSx and how it helped me achieve product-market fit and grow my company fast.


As they say, “a startup’s life is a roller coaster with ups and downs”, this ride has not been easy for me either. Just to talk in numbers, in the first 1.5 yrs of our existence, we were able to add only 22 customers and that too mostly from Pune, our home-ground. While in last 6 months, we have been able to add over 100 customers from 11 different countries. Needless to say – SaaSx has played a major role in helping us achieve this. Hence, I would like to share my journey and learnings from SaaSx with the larger community of SaaS people out there.

My SaaSx journey started when Prasanna advised me to visit SaaSx-1 in Chennai and Avinash was kind enough to allow me immediately. I had one more reason to visit Chennai – to meet Krish (my mentor).  I am happy to thank SaaSx, Prasanna Microsoft, Suresh  Kissflow, Krish ChargeBee and Girish Freshdesk who are constantly acting as a source of knowledge and guidance for me.

Interestingly, I found something common about all of them and you know what that something is…They are all from “SaaSx” and they are all from “Chennai” .

So now I can say that “SaaSx Chennai Express” is changing my (Interview Mocha) life completely and moreover this Chennai Express journey is a lot safer than Shahrukh Khan’s Chennai Express as there is no Tanghaballi (villain) here, only heroes :-)  and you still get your sweetheart Meenamma (Success).

Krish has helped us grow our daily leads from 2 to 10 leads a day. Suresh helped me multiply this number by his personal mentorship and playbook on Nuts and Bolts of Marketing & selling SaaS products to US customers from India for First Timers. Girish’s Talks always makes me think – how this poster boy of Indian SaaS knows all my key problems and their solutions. He narrates everything as if he is my personal mentor helping me sharpen my SaaS business skills.

So, here are the key takeaways, learning and some food for thought from my interactions with these SAAS champs:

1. Focus, Focus and Focus.

Focus on customer pain (mother-problem(s) you are solving that customers care about). Focus all your efforts to solve these problems the best way possible.

2. Your Product has to be Superb.

Customer success, Word of mouth and “Mouth of word” are the key for SaaS products and which is not possible without a superb product. Product is the core – keep it in mind.

3. Product Market Fit.

Your product needs to achieve a product market fit for adding customers quickly and scaling further. This is the first good thing that can happen to your start-up. Product/Market Fit is the degree to which a product satisfies a strong market demand. It has been identified as a first step to building a successful venture in which the company meets early adopters, gather feedback and gauges interest.

4. Cold Calling 2.0 doesn’t work.

Cold calling 2.0 won’t suit your economies for B2B companies with less than $ 2,000 annual revenue per customer. Though cold calling 2.0 is a great predictable way for pipeline generation, however it is not suitable to scale when you are charging very less annually.

5. Do not rely only on Email and Chat Support for closures.

Talk to signups/prospects over phone. We are 100% inbound till a person signs up. Talking to users helped us increase engagement with prospects and in turn more closures. Also, you get the insights that your sales team needs to understand.

6. Founders – Change the work timings if you are targeting US.

Analytics do help you understand customers but nothing better than talking to customer themselves. Quicker responses means more business.

7. SEO and Content Marketing are compulsory.

Content is King  & SEO is the way.  One or other traction methods may work, you can refer the list of all traction methods – google “Bullseye framework traction trumps everything”.

8. SaaS is Software as a Service.

Focus highly on support activities and customer success. Get immediate reply policy as a part of company’s DNA. Remember “Fast is Success”.

9. Understand behavior of SOHO, VSB and SMB for sure.

Each customer segment has its typicality and common needs. Understand their pain points, where they hang out over internet, how they buy, what makes them happy. Targeting big deals from enterprises in initial days may not happen. One funny thing, we have a few fortune 500 companies as our customers paying us $49 p.m. these are SaaS enterprises (business units) and not classic enterprises.

10. A/B testing is the way for SaaS companies.

What works and what works better – don’t assume much. Try A/B every now and then.

11. Tools help.

Start exploiting Mixpanel, Intercom, Moz etc.  being a SaaS player, trust and adopt SaaS.  These tools are helping us a lot in reaching, understanding and communicating with customers.

I consider the above points as extremely important for any SaaS business. I strongly recommend becoming a part of SaaSx community, if you are a SaaS startup in India. Chennai Express passengers/ drivers (Prasanna, Krish, Suresh, Girish, Avlesh, Paras, Avinash and many more) are easy to strike a conversation with, ask any question and receive immediate valuable responses.

Recently, I attended SaaSx-2 and acquired a new set of learnings. But I’ll wait to write on those learnings till I execute them successfully. And yes, looking forward to add 500 more customers before I board SaaSx-3 :-)

Thanks SaaSx Chennai Express. Wishing All the Best to all Indian SaaS Start-ups!