The SaaS Roundup, August 19, 2019

This week’s SaaS roundup features tips for improving your organizational efficiency metrics, structuring your SaaS pricing for growth, Solution Selling in SaaS and much more! Let’s get started…

The ROSE Metric | The Return on Your Most Important SaaS Asset

Ben Murray (AKA The SaaS CFO) dusted off the company blog after a two-month hiatus to discuss one of the most important metrics in SaaS. Stating his opinion that FTE (full-time equivalents) doesn’t zero in on true efficiencies, Murray introduces a newer, less generic organizational efficiency metric. The ROSE metric (short for Return on SaaS Employees) goes deeper than revenue per FTE, highlighting the tradeoffs between headcount, recurring revenue, and EBITDA growth. But Murray doesn’t just explain why this metric is better, he also teaches you how to calculate both the ROSE metric and your Return on Employee EBITDA (ROEE). Once you understand the true power of these metrics, you’ll wonder how you ever lived without them!

The objective of this post is to create awareness about the largest and most important asset in your company – people. We think hard about what and how many positions that we need in our organization. Once the position is filled, we move on to the next open or new position.
Let’s extend that thinking to the investment needed for our colleagues to grow.

– Ben Murray

How to Structure Your SaaS Pricing and Packages for Growth

Chargify writer Gary Amaral penned a brilliant piece on SaaS pricing, and how pricing just may be one of SaaS’ greatest untapped growth levers. A recent study of 512 SaaS companies performed by Price Intelligently discovered that monetization has the largest impact on the bottom line. According to their findings, SaaS pricing is 2x as efficient as improving retention and 4x as efficient in improving as acquisition. What does this mean? Simply, it means that that you may be leaving a considerable amount of money on the table if you are not continuously optimizing your pricing. So, how do you optimize your pricing? Amaral shows you how!

SaaS companies are all about growth. They spend a lot of time, energy, and money on acquiring new customers and retaining the existing ones. However, they often overlook the most powerful way to increase their revenue, which is pricing optimization.

– Gary Amaral

7 Lessons from SaaS Companies who Built Their Product For Teams and Enterprise

In a sea of overwhelmingly redundant SaaS business content, Paddle Senior Product Marketing Manager James Doman-Pipe never fails to offer uniquely fresh insights into common SaaS issues. Sharing 7 lessons from SaaS companies who have built their product for teams and enterprise, Doman-Pipe teaches readers how to position their product so that it both appeals to multiple users and encourages increased usage across teams. But this isn’t just another “land-and-expand” clickbait piece. This is real information from people who have really done it time and time again. It’s detailed, realistic, and designed to help you get started today!

By inbuilding restrictions or features, you’re able to see when a user wants more and wider use of your product. Through what’s known as a ‘land and expand’ sales model, it’s possible to upsell a prosumer and essentially infiltrate a company through this one seat, turning a B2C transaction into B2B deal with a large company.

– James Doman-Pipe

Solution Selling in SaaS

Sharing some of his favorite excerpts from Mark Marone and Seleste Lunsford’s ‘Strategies That Win Sales‘, Blossom Street Ventures co-founder Sammy Abdullah aims to help readers understand SaaS solution selling. Originally gaining popularity in the 1980s, the solution selling sales methodology is fairly simple. In its simplest form, a salesperson diagnoses a prospect’s needs, recommending products and/or services that will meet their needs accordingly. Because the prospect does not know they have a problem or opportunity, how important it may be or how to address it – the salesperson becomes an important resource. The salesperson can not only help the prospect understand the situation, but can also influence how they react to it. This is ideal for industries with highly customized products and packages. So how do you get started with solution selling? The excerpts included here outline the necessary steps.

Face-to-face will always have more intimacy. Customers will always tend to cut it short when you are on the phone.

– Mark Marone and Seleste Lunsford

7 Tips on How to Start a Successful SaaS Business

Time Doctor co-founder Rob Rawson reached out to 7 highly-successful SaaS founders for advice on starting a SaaS business earmarked for success. Spotlighting powerful tips from heavy-hitters like Marketo‘s Jon Miller, Segment.io‘s Peter Reinhardt and more – this article just may hold the missing piece to your ultimate SaaS success.

SaaS companies can’t afford to spend lots of money bringing new customers in the front door only to have them leave out the back door. Renewals are essential. It can take several months, even years, to recover the cost of acquiring new customers.

– Peter Cohen

Happy reading!

Thanks so much for joining us for another SaaS roundup. We hope to see you here again next Monday!