Metrics that Measure Up

SaaS Spend Management is an emerging and rapidly evolving category - yet Ryan Neu, Co-Founder, and CEO of Vendr has a unique vision for how the category needs to evolve.Ryan has a background in public accounting, and then transitioned to software sales, including a role in the early days at Hubspot. During his career selling, he realized that selling great products is hard, takes too much time and the distribution is quite inefficient - thus the catalyst to founding Vendr in 2018.Vendr was created as a new way to buy and sell software....and it is the "SELL" comment that is unique amongst SaaS Spend Management See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

If you have ever been frustrated with the forecasting process and accuracy at your company - this episode is for you!Guy Rubin is the founder and CEO of ebsta, a leading provider of Revenue Intelligence - the next generation of forecast management.Guy founded ebsta to automate the logging of sales rep activity directly into their Customer Relationship Management (CRM) like Salesforce and Hubspot. Over 50,000 companies have used ebsta in this environment which is when the breakthrough happened to begin scoring target buyer relationships - essentially a "relationship score".The strength of relationships is a key factor in an opportunity's probability to convert into a new customer....and thus making the revenue forecast more accurate. More on that later in the episode.Back to the core problem, ebsta has been solving for years - having timely and accurate account, contact, and opportunity data in their CRM. Since most of this data is captured in their email, and/or calendar. By using technology to capture every email, event, and meeting with an account or opportunity, it can be automatically imported into the CRM. Then, a company can use AI to determine the frequency of communications with an opportunity and begin to create an "opportunity score" based on the recency, frequency, and level of activities with specific opportunities.What about including insights from "conversational intelligence" platforms? This is another signal that ebsta uses to evolve the "engagement score", but Guy highlighted that CI is only one signal that informs their platform.Intent data is another signal that ebsta uses to inform and evolve their engagement and thus opportunity score. In a recent research report that ebsta published, one of the challenges is to determine what is the actual impact of intent data on the opportunity "win rate". In this report, ebsta was able to identify the level of influence that intent data has on win rates.Forecast accuracy is a challenge for every company. Initially, Guy felt the "ebsta" internal forecasts were superior to those of a "bottoms-up" process that begins with the AE or front-line sales manager. Those customers still require the ability to include the sales "bottoms-up" forecast, the ebsta automated forecast is typically within a +/- 5% error of margin - which is superior to the 69% of companies that miss the forecast by +/- 10% or greater.If you are involved in your company's "forecasting process" this conversation with Guy provides great insights and ideas to enhance your forecast accuracy!!!See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Friday, March 10th, 2023 - a moment in B2B Technology and Start-Up ecosystem history that many will never forget and hopefully provides a foundation for learning the risks and rewards of venture-backed, early-stage entrepreneurship.Todd Gardner founded SaaS Capital in 2007, the industry's first "recurring revenue credit facility". Before names like Salesforce, Workday, and Snowflake were well-known names, Todd experienced the financial crisis of 2008 and experienced firsthand the impact of a systemic banking issue including the meltdown of his financial partners.Our goal for this episode of the podcast is to provide practical insights and advice that SaaS founders, CEOs, and CFOs can apply to decrease the risks associated with their financial related decisions and banking decisions.We started with the basic, summary facts surrounding the collapse of Silicon Valley Bank (SVB):December 31, 2022, SVB financial disclosure: - $209 B in total assets - $175.4B in total depositsMarch 8th: SVB disclosed a $1.8B loss on the fire sale of $21B in long-term assetsMarch 8th - 10th: ~ $42B in deposit withdraws were made by SVB customersFriday, March 10th: SVB was declared insolvent and closed by U.S regulatorsSunday, March 12th: U.S. government including the FDIC, US Treasury, and Federal Reserve announced that all deposits (100%) would be backstopped - made good because SVB had more than enough assets to cover the outstanding liabilities, primarily customer deposits. Essentially the US government is managing the risk which is primarily a "time-based" issue versus a balance sheet issue.Todd next provided an industry backdrop that lead to the run on SVB. Due to the accelerated ramp of venture capital investing in 2020 - 2021, the deposits on hand at SVB doubles. As standard bank operating practice, SVB invested a significant portion of those deposits in long-term bonds and treasuries, which had a low return due to the low-interest rates of the moment.During the second half of 2022, interest rates began to increase dramatically, and the result was that the value of the long-term bonds decreased in value. Simultaneously many customers were moving their deposits at SVB into higher interest-rate instruments outside of SVB - forcing SVB to sell some long-term assets to support the decrease in deposits.Due to the above macroeconomic interest rate dynamics, coupled with the short-term issues created by a handful of Venture Capital firms quietly recommending their portfolio companies move their deposits out of SVB.We next discussed the "financial ecosystem" that has been the foundation that fueled the amazing growth of the technology industry which includes: - Over half of the technology start-ups banked with SVB - Over half of Venture Capital firms in technology banked with SVB for Capital Call - Line of CreditHaving the primary source of assets and liabilities from the same industry ultimately becomes a material issue for SVB.The above is a backdrop to the insights and advice that Todd shared for how this experience can inform future financial and banking decisions by SaaS founders, CEOs, and CFOs which include:#1: Diversify banking relationships including checking, savings, and credit facilities          - have at least 2 banks and/or treasury based money-market account#2: Understand the banking relationships that your payables and payroll firms use#3. Maintain fiscal discipline throughout the start-up journey to change the narrative from "cash runway" to ongoing operating profit as early as possibleIf you are interested in learning more about the Silicon Valley Bank collapse and what it means to the financial strategy of SaaS CEOs and CFOs going forward, this conversation with Todd is a great listen.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Over February and March 2023, we spoke with several founders, CEOs, and executives at SaaS Spend Management vendors.In this episode of the Metrics that Measure Up podcast, we discussed the evolution, best practices, and ideas on how to introduce a SaaS Spend Management program with Brad Van Leeuwen, Co-Founder and COO at Cledara.Brad stated that his own experience as an entrepreneur with the challenges associated with SaaS spend was the catalyst to founding Cledara. When a company is small, a manual process such as using the founders' credit card for all expenses is fine, but when you scale to 100+ employees that process does not provide the level of control and capital efficiency required to build a sustainable, durable growth company.Spend management solutions have been around for 20+ years - why is SaaS Spend Management so popular in 2023? First, the technology solutions have evolved significantly, and are much easier to use. Secondly, almost every company requires technology (software) to operate efficiently so the demand for SaaS solutions has exploded. Third, no longer is IT guarding the "data center or servers" so the procurement of software has become a decentralized process.SaaS Spend Management goes far beyond issuing a "corporate credit card" for all purchases, and includes a more proactive identification and then usage monitoring of the most relevant and used SaaS solutions in a company - thus providing centralized visibility and control.When should a company evaluate introducing a SaaS Spend Management solution - early on the focus needs to be 100% focused on developing and selling your product to establish Product Market Fit. Then, as a company evolves to 30 -50 companies, a general spend management tool centered on corporate credit cards is a good place to start. Once a company hits 50 - 100 employees, the SaaS Spend sprawl becomes harder to control and is a good time to consider introducing a corporate SaaS Spend Management solution.One of the key benefits of a SaaS Spend Management solution is that decentralized buyers can now have access to a pre-approved list of solutions. This empowers the employee to engage with the solution category of their choice, and the approved vendors without having to deal with a difficult procurement process. One of the trends in SaaS pricing and billing is the increased use of "Usage-Based Billing". One of the benefits of using a SaaS spend management solution is to have real-time insights into billing trends measured against budget and provide an early warning signal or even stop the use of a specific solution when the costs exceed the budgeted or contracted amount.One other benefit of SaaS Spend Management is to provide a pre-vetted list of vendors and the associated "realized pricing" that should guide a new solution purchase and/or renewal.If you are interested in learning more about how your company could gain increased visibility, control and reduced costs of your SaaS Spend while improving your employee experience in buying new SaaS software - this discussion with Brad Van Leeuwen is a great listen.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Planning in 2020 continues to be chalked full of uncertainty based on the current macroeconomic reality. Assuch, being a finance leader in 2023 is even more challenging, and unpredictable -  but developing an operating plan and budget is an important and critical component of the CFO's job.First, is being "hyper-realistic" is the theme of the year, especially on top-line revenue. Understanding revenue drivers like pipeline generation and conversion is critical to informing the 23' budget and operating plan. Factoring in longer sales cycles closed lost - no decision and buyer hesitancy is part of the art in building the 23' plan.Second is being "hyper-responsible" in managing costs. Third is "running multiple scenarios" highlighting the goal of profitable growth, which should always be in style, but even more imperative in 2023. Though Net Income is always interesting, in the B2B SaaS industry revenue growth is still a key driver, while EBITDA and Free Cash Flow are key indicators of profitable growth.Fourth is "obsessing on the leading indicators" impacting revenue trends.How have the relationships between CFOs and CROs changed heading into 2023? Dan highlighted he is lucky as both his head of revenue and head of customer success are metrics focused, and they collaborate closely on planning and forecasting - using over 80 metrics to continuously monitor their progress toward their operating plan.Next, we discussed the challenges of forecasting - especially in today's uncertain environment. Dan shared that hitting a +/- 5% accuracy is probably best in class, while Planful targets 3% - 5% forecast accuracy. Then we discussed the "triangulation methodology" which evolved into using Machine Learning and Artificial Intelligence. However, Dan started by ensuring front-line sales professionals need to see forecast accuracy as a priority. Dan shared a few tips to improve forecast accuracy. First, sales managers should provide a weekly forecast update as they are the closest to the pipeline, Second, Finance should be monitoring pipeline generation and conversion rates to continuously update the forecast. Third, using AI to capture the signals that impact opportunity conversion rates to provide an automated forecast to be combined with the first and second manual forecast management processes.What are the top 3-5 performance metrics that Dan is focusing on in 2023? Dan highlighted ARR growth is still a top metric. However, Dan focused on "leading indicators" including outbound pipeline development trends - including the pipeline from SDRs. Other leading indicators Dan tracks include outbound connect rates, conversation rates, opportunity conversion rates, and sales team acceptance rates. Start by looking for "trends" which can serve as very important pipeline trend insights. Next, looking at the opportunity funnel conversion rates in concert with analyzing conversational intelligence insights is very helpful to understanding "early signals" impacting revenue growth.A strong financial operations capability starts with instrumenting the infrastructure that can quickly surface leading and lagging indicators to inform decision-making. Dan highlighted the importance of technology to compress time from activity to insights to a decision. Being buttoned up on the CRM infrastructure and data are table stakes to fully leverage automated planning, forecasting and reporting.At what stage of company evolution should a SaaS company start the "instrumentation and automation" journey for planning, forecasting, and metrics reporting. "Complexity" of business operations is a critical factor to determine when to begin the automation journey.  If you are considering how to increase your planning and forecasting accuracy, the conversation with Dan is very insightful and full of great ideasSee Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

How does writing a 400-page novel lead to founding a SaaS Spend Management company? It was the start of David Campbell's journey which including breaking into B2B technology sales where he saw the challenges companies of all sizes have with buying technology.What is the definition of "SaaS Spend Management" according to David? David defines it as "spend management for the most important asset category in business today and tomorrow". Most companies are becoming software companies, and thus why SaaS spend management will become the top spend in most companies.Where investors focused primarily on revenue growth over the last few years, today the focus is now on efficiency and profitability, and as such "procurement and efficiency is the new Sales". A hot take, but a comment that is intentionally provocative to move the pendulum closing to an equal balance of revenue growth and profitability.Over the past 12 months, Tropic has grown over 3x, due to the outsized demand for "efficiency levels" beginning in 2022 and continuing into 2023. One of the trends David has seen, is that company CEOs and CFOs were so focused on revenue growth, that they were comfortable with outsourcing SaaS procurement management to a third party.There are three components to a successful SaaS Spend Management deployment:1. Identify SaaS products in use today and optimize current spend2. Deploy an infrastructure and process to increase visibility and control 3. Ensure the process uses automation to make the SaaS procurement process easier not more difficult for employeesMaking the process of buying a SaaS tool needs to continue to be decentralized and easy, but powered by a process and infrastructure that also centralizes control and visibility into the SaaS purchase and usage analytics.When should a company implement a SaaS Spend Management program? David suggests 100 employees is a good place to start. By implementing a solution early, the culture of a structured SaaS procurement process is much easier to scale as companies hit 500 and 1000 employees. Attempting to introduce a formal SaaS Spend Management below 50 employees is most likely to meet significant resistance..In today's evolving world, software is often either the number two or number three expense category after compensation and benefits. For companies in this category, introducing a SaaS spend program prior to a full fledge "procurement function" can provide early financial wins without needed to invest in a larger purchasing infrastructure and organization.SaaS spend management does often include a "managed buying service" and technology to automate SaaS purchasing while simulatenousy increasing ease of purchasing and control the on-going expense and risk of SaaS sprawl.Procurement Paradise is the primary goal of Tropic.ai and is a unique approach to gaining company wide adoption of a process targetted at providing greater control of the SaaS spend, while empowering every employee to purchase sofware that increased their job productivity within the approved framework and process of a well defined SaaS Spend Management program.If you are responsible or interested in controlling SaaS spend in your company, or a B2B SaaS sales professionals looking to sell into companies with a formal SaaS Spending Management program in place - this conversation with David Campbell provdies a good lens into procurement paradise.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Oded Zehavi has global payment experience from his time as an executive at leaders including PayPal and Payoneer.With Spend Management, especially SaaS Spend Management, becoming such a hot topic in 2023 - we wanted to start our conversation with Oded to understand his definition of "Spend Management"?Oded defines spend management as enabling finance teams to automate, control, and increase visibility into non-payroll spending. Spend Management has been around for 20+ years - why is it trendy again? Before Covid - spend management was primarily about travel and entertainment, including how to collect manual receipts and reimburse employees for those expenses incurred. During Covid, travel and entertainment expenses were reduced materially and provided finance a chance to pivot to new strategic financial control opportunities. Covid also increased the decentralization of the majority of employees and added another level of complexity to traditional expense receive collection, review, and payment processes.Finally, the maturation of SaaS adoption across all sizes of companies introduced new challenges for finance teams to gain visibility into the distributed procurement, usage, and individual expensing of cloud-based software.Oded also highlighted that traditionally the expense submission, reporting, and payment processes were not integrated. Specifically, first-generation expense management solutions were not integrated with the financial payment infrastructure. With today's more sophisticated spend management technology, companies can identify in real-time expenses and even expense payment attempts and ensure they are adhering to internal expense policies and controls.Next, we pivoted to "when should a company consider implementing a spend management program"? In a company's early days, there are general-purpose tools that can handle the majority of financial transactions, including non-payroll expenses. Beginning at 50 employees is when finance processes being to have more complexity and is a good time to begin considering a spend management program. At 150 employees implementing a spend management program becomes more important and at 1,000 employees a more sophisticated spend management program that integrates expense management and financial payment infrastructure becomes imperative.98% of US-based companies are not using advanced technology and process to manage and control expenses. A growing trend is the evolution of dedicated, vertical spend management solutions such as "SaaS Spend Management". One of Oded's "aha" moments was when he was speaking with a CFO when a corporate credit card linked to 40+ SaaS vendors expired, and one by one SaaS vendors started to terminate their access to their platform. As such, SaaS Spend Management was an area of top focus for Mesh Payment early in their evolution.If you are evaluating spend management in your company, or just want to better understand how next-generation spend management solutions can increase visibility and control of all your non-payroll expenses, including your SaaS expenses, this episode with Oded Zehavi is a highly informative listen.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Have you ever met someone in their "early career" that you just knew was going to be successful? That was my feeling when I first met Guy Yalif, Founder and CEO of Intellimize almost 20 years ago!Guy has been both a Marketing and Product leader, which led to his creation of a company focused on optimizing full funnel conversion. Guy's vision is to personalize each website visit at the moment to create high-converting websites to optimize conversion and revenue. 1:1 web personalization has been discussed and evangelized as the holy grail of web experiences for over 20 years - so why is it just happening now? First, the technology is finally available to make this vision a reality, second marketers have been conditioned to create "segments" and then create custom lead routing rules for each segment due to the limitations of the technology.The reality is that humans max at 10-20 different business rules, and we cannot scale to the ultimate goal of 1:1 marketing which can combine thousands of different signals to show a user, in real-time content that is highlighted relevant to a market of one.The common trends of the day include defining Ideal Customer Profile segments and then combining that with different content and paths for each buyer persona(s). Third-party information such as "intent data" has been a recent development to further "segment" content to visitors based upon their intent, but still does not get us down to a unique website experience for each and every visitor - resulting in increased conversion rates.When asked if the technology is now available to convert this vision into reality, Guy said that before Intellimize the technology did not yet exist. Couple that with the need for scale and volume of traffic to train the machine learning, the infrastructure, and capabilities were not yet available for the masses.Large scale B2C companies, such as Amazon and Netflix have the resources and scale to build their own highly personalized 1:1 engagement methods. Unfortunately, smaller scale companies did not have access to a similar capability with similar capabilities but bundled as an easy-to-use, out-of-the-box solution for B2B Marketers.The conversation pivoted to the signals being used to enhance full-funnel, continuous conversion optimization? Signals can include data from any source including internal sources such as the marketing automation system, CRM system, and external signals such as time of day, day of week, location, previous activity/behavior on the website, and what content has previously led to conversion and revenue.Next, we discussed the measurements (metrics) that B2B Marketers should be measuring - limited to the top three. First, pipeline ($) generated, second was "cost per Lead (actually cost per MQL) and third was "share of voice".  MQL to opportunity and MQL to Closed-Won conversion rates should also be a high priority. When I pushed on "cost per $ revenue", Guy highlighted that this was a great "quality" measurement to determine the quality of Marketing Qualified Leads and their conversion rates to revenue generated.I had to go to my favorite topic - and that is the time spent on "attribution". Guy said Marketers must be able to highlight the value that Marketing delivers, and though the ultimate focus needs to be placed on the ultimate outcomes of pipeline ($) and revenue ($), it is important to understand the touch points and engagement levels that lead to new customers. If you are interested in how to optimize the conversion rate starting at the first point of engagement on your website, this conversation with Guy Yalif is a great listen!See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

How many times have you visited a B2B website and cringed at being asked to provide your contact information, including your email just to download a white paper or watch a video?Why is this a reality in 2023 on most B2B SaaS websites? Because "leads" are still a primary measurement of Marketing success and marketers have not yet invested in the processes and instrumentation to focus on both the "pre-opportunity process" and then the ultimate outcomes of pipeline and revenue.One of the first topics we discussed was the "buying journey" which in the 6sense land is focused on the "pre-buying" or pre-opportunity journey which is often the area that is understood the least. A majority of the pre-opportunity journey is anonymous, most B2B companies will have multiple resources touching the early phase of the journey and there is real friction and resistance for buyers to reveal their identity early in the process.However, by understanding the pre-opportunity journey, a company is better positioned to engage with potential buyers in a more personalized and impactful way. Latane' defines the pre-opportunity buying journey into 5 phases including:- Target- Awareness- Consideration- Decision- Purchase (meaning they are ready to enter the active opportunity phase)Once a company moves into the "decision" of which company a buyer wants to engage in a sales process is the best time for B2B marketers to proactively reach out to a potential future customer. The concept of "IICP" takes the Ideal Customer Profile to another level by introducing the "in-market" Ideal Customer Profile. By understanding that an account is actively researching and evaluating a specific market category that your company plays in. Taking this concept to something that "Sales" cares about includes being able to provide the Sales organization with real-time leads that are actively "in-market" and thus have a much higher conversion rate to qualified opportunities.Next, we double-clicked into why a minority of B2B companies are not actively using "intent data" to determine when an "ICP" account is actively in-market. Latane highlights that a major obstacle is that a well-defined "workflow" is not often in place to ensure that the Sales Development team comes in each morning with a complete, prioritized list available for them to start the day off productively...versus spending their time researching and building a prioritized list for outreach.If you are responsible for engaging a target market and buyer to generate high-quality leads, and/or are interested in how to take advantage of intent data, account-based programs, and the dark web to increase pipeline quality - Latane is a great listen and her book NO FORMS, NO SPAM, NO COLD CALLS is a great read!See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Media-Led Growth (MLG) is a term first introduced here on the Metrics that Measure Up podcast and the central theme of this episode.Who better to discuss this topic than Patrick Campbell, Founder, and CEO of ProfitWell, recently purchased by Paddle for an unofficial $180M+Patrick was a pioneer in building brand media assets inside a B2B SaaS company at ProfitWell - what led to the decision to invest in media properties?ProfitWell was facing a common challenge that most B2B SaaS companies face, how to sustain growth and generate "outsized" gains in a very competitive landscape. Eight (8) years ago the macro-level environment was different. Early on, email open rates were much higher, Google ads were much lower, and social media channels were just beginning to gain relevance. Over the last 3 - 5 years, those digital channels become noisy and much less effective.Resultantly, Patrick was looking for a more innovative, and more efficient marketing channels. ProfitWell was bootstrapped, which made efficient growth an even higher imperative. Early on, Patrick started posting information on churn rates, retention rates, and pricing which was a less saturated topic.Quickly, Patrick found the content was resonating, and based upon research discovered that traditional inbound marketing strategy (blogs/ebooks/whitepapers) averaged 1.6 touches per week from a qualified lead and traditional media companies average 5+ touches per week. With Customer Acquisition Cost increasing, Patrick had a hypothesis that media might be a "marketing secret weapon" within ProfitWell.On an economic basis, Patrick discovered they could produce a media asset like a podcast or video series with 13 episodes for the same or even less money than a traditional content marketing asset. As such - ProfitWell created multiple media assets - a media company inside a B2B SaaS company. Moreover, this "pool" of media properties provided an opportunity to engage potential buyers and influencers weekly. Additionally, Patrick didn't stop at a single media asset, at one point in time ProfitWell had 9 different media properties that engaged different buyers with different subjects.Patrick framed the value like this "imagine having 500 people attend a webinar you sponsor every week!" Having "shows based on the "problem and/or role" that ProfitWell was trying to reach as potential buyers of their SaaS product was the primary focus. This resulted in a "grid" of content and buyer personas that informed the decision to create multiple media properties. Patrick also highlighted the importance to measure performance early and continuously to end any properties that are not producing positive returns as measured listeners, downloads, and engagement.I asked Patrick "is audio or video the best place to start?" Patrick highlighted that audio is an easier and cheaper way to start, but introducing a video asset is a natural evolution.Finally, we pivoted to ProfitWell's use of "benchmarks" as another asset. Patrick started with his belief that benchmarks are not used properly. Benchmarks provide a "focus" on which metrics to review and where to prioritize focus. Those areas where your internal metrics are far off the benchmarks are a great place to start. If you are a B2B SaaS founder/CEO, Chief Marketing Officer, or other Go-to-Market executive looking for innovative and differentiated ways to reach your target audience and increase the frequency of engagement, this podcast is a GREAT listen that is chalked full of thought-provoking ideas from an expert!!!See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.