Greg Hoffman (Hoff) and I showed up early and furthered our Continuing Education in SaaS yesterday at the May SaaStr CSS Speaker Series.
SaaStr Omiyage: 100% Kona Coffee
Showing up early yields facetime with Jason Lemkin, the face and brand behind today’s SaaS industry. Since I’ve read he likes everything from Hawaii, I brought him an omiyage from my recent trip back home- a bag of 100% Kona coffee.
Despite having been turned down twice from his SaaStr fund, we don’t give up and we show our appreciation for leveling up via SaaStr events.
I told Lemkin I bought four copies of his book “From Impossible to Inevitable” for key managers at Paubox. I also asked for advice on establishing comp plans for our Customer Success and Marketing departments. He suggested we make sure our comp plans are accretive. Duly noted.
How to Build a Highly Capital Efficient SaaS Company
Here are my takeaways from their excellent talk:
- “Invest in great people you know.” [Jason Lemkin]
- Sameer’s first job out of college was at Trilogy at a Produt Manager (1995). He met Ajay Agarwal there.
- Sendgrid has 50,000 paying customers and is doing $100M ARR.
- Over one million developers using their platform.
- “How do you drive value to the customer?” [Ajay Agarwal]
- “Build a company culture that has edge, is unique and one that does not fit for everyone.” [Sameer Dholakia]
- “Every single hire you make is mission critical. You can’t get those wrong.” [Sameer]
- Who is doing your recruiting? It’s a privilege, not an obligation.
- Sendgrid has an extraordinary go to market business model. Solving product buyer fit.
- Sendgrid solves a pain point for a particular persona who can put their credit card down and buy it.
- 99% of Sendgrid customers sign up via self service.
- Look at keyword search for determining whether or not to do self service.
- Email Marketing is a $5B TAM with hundreds of competitors.
- Sendgrid was crazy focused on buyer personas. For example, they give away 10,000 Sendgrid t-shirts per year.
- “I believe email will outlive us all.” [Sameer]
- “Profitability is a choice, not an outcome.” [Sameer]
- Efficiently acquire and serve customers. Go to market strategy is key.
- Rule of 40: Take your growth rate as a percentage and add profitability metric. They should equal 40 (or more).
- Sameer and Ajay learned about the 3 Horizon Product Strategy from Trilogy: Cash cow, Growth engine, and Moonshot.
- 70% of Sendgrid email read on mobile. (That probably holds true for all email!)
- $38 ROI for every dollar spent on Email Marketing.
- Sendgrid sends 35 billion emails every month.
- Sendgrid explicitly does not sell to the enterprise (yet).
- 95% of Sendgrid customers on monthly plans.
- “Cloud is here and it’s opened up so many new opportunities.” [Ajay]
- The 4 H’s of Sendgrid’s company culture: Happy. Hungry. Humble. Honest.
- Defining your company’s culture: The sooner the better.