Top 10 Learnings from the Redpoint Free Trial Survey

At Saastr yesterday, I presented the top 10 learnings from the Redpoint Free Trial Survey that we distributed in October. The data confirmed many rules of thumb but also raised some interesting new questions about the best way to use trials.

When we distributed the survey, we never would have expected the response. About 600 companies submitted data. They span single digit ARR businesses to publicly traded SaaS companies. These businesses sell at every price point and sell to every operational buyer. From product to sales, from legal to marketing.

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A New Architecture for Next-Generation Software Companies: Announcing Mattermost

The first wave of SaaS is 20 years old. Today, the SaaS model dominates. But we’re seeing the emergence of a different type of next-generation software company. A new wave of companies that is responding to the changing needs of customers by innovating their architecture. Very simply, they liberate the database from the application.

In license software, the database ran alongside the application on-prem. In SaaS, the database runs next to the application in the cloud. But what if you freed customers from this constraint, and gave the customer the choice of where to run each? Suddenly, the customer is in control of their data in a way they never can be with SaaS.

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The Two Things You Need From Early Customers that Matter More than Cash

As you start to go to market, there are two things to prioritize from early customers that matter more than cash. Feedback and marketing rights.

The feedback matters for obvious reasons. The product is early; customer feedback will help you hew the raw granite of your initial product into shape.

The second may not be so obvious. Every prospect championing a software purchase will be asked by the opponents of the sale and decision-makers: “Who else is using the software?” The more impressive your customer list, the stronger the case your champion can extol. Logos confer credibility.

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Sharing the Learnings from the Redpoint Free Trial Survey

Late last year, my colleague Pat Chase and I announced the Redpoint Free Trial SaaS Survey. Over the course of a few weeks, we received roughly 600 responses from SaaS startups who use these marketing techniques. They span companies from $1M in ARR to more than $100M. The respondents sold into every key function of a business and at all different price points. On February 5 at 10am, I’ll be sharing the top 10 learnings from the survey at Saastr. After the conference, I’ll post the slides with the conclusions here.

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What Makes a Great Leader?

It’s very difficult question to answer. How do you judge a leader? Is it financial success? The loyalty they engender? Their ability to inspire? There are war-time leaders and peace-time leaders. Leaders may be understated or zealous. I’m not sure we’ll ever be able to say definitively what constitutes a great leader. Regardless, we all want to improve our ability to lead, whether it’s a small team or a Fortune 500. But how?

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Infinity Wells and Deep Work

Over the weekend, the NY Times interviewed a classmate of mine from Dartmouth and fellow oarsman on the freshman crew team, Cal Newport, about his book and his idea, Deep Work. Here’s the crux of the idea:

Deep work is my term for the activity of focusing without distraction on a cognitively demanding task. It describes, in other words, when you’re really locked into doing something hard with your mind…In order for a session to count as deep work there must be zero distractions. Even a quick glance at your phone or email inbox can significantly reduce your performance due to the cost of context switching.

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How Many Managers Will You Need This Year?

Your startup is growing quickly. To hit next year’s target, you may need to hire many people. Where do you start? Bottoms up or top down? Both are viable strategies, but hiring a strong management team at every level provides some key benefits. First, they help you hire more effectively. Second, they will guide new additions to the team to success. Third, they will reduce unnecessary turnover.

As you grow, your company well need to interview and hire large numbers of new people. Managers help this by bringing their own network, spending 30-50 percent of their time interviewing and recruiting, and will on board these new hires successfully

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How Much ARR Can a CSM Manage?

How much can a customer success manager manage? I’d heard the wisdom of $1-2M in ARR per year and around 80 accounts. But I hadn’t come across any data. Last summer, Gainsight posted the results of their survey on the topic. The truth is most CSMs manage between $2-5M in ARR and somewhere between 10-500 accounts. But it varies by segment.

The charts above display Gainsight’s data. I’ve reformatted them to compare segments side-by-side. In the Enterprise and MidMarket, the survey indicates most CSMs manage $2-5M in ARR. We see a normal distribution with a slight left skew. This means it’s rarer to see a CSM manage 10-20M in ARR than $0.5M-$1M in ARR in both cases.

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Serving the People First Enterprise

Last year, I talked wrote 1% of Salesforce’s Revenue Makes a Unicorn.The post talked about the potential in the SaaS ecosystem for startups to identify underserved customers in existing installed bases of incumbents and build big companies serving them better. Kustomer is a customer support software business based in New York that is doing just that. And today they’re announcing two milestones for the business: their $35M Series C and 5x annual growth.

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Eugene Wei's Novel Mental Models for Technology

In the car yesterday, I listened to an interview with Eugene Wei, who described the dynamics of consumer technology as if they were plain as day. It’s rare to hear someone lucidly describe complex topics like the reasons for Twitter’s success and struggles. Eugene wrote many of his ideas in this post though there are some ideas that I found only in the podcast.

Eugene was an early PM at Amazon, SVP of Product and Marketing at Hulu, Head of Product at Flipboard, and Head of Video at Oculus. He’s deep in consumer technologies.

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