SaaStr Annual 2024: SaaStr Bootcamp with Christoph Janz: Metrics That Matter: How to Convince SaaS Investors with the Right Data

SaaStr Annual 2024: SaaStr Bootcamp with Christoph Janz: Metrics That Matter: How to Convince SaaS Investors with the Right Data

1. Metrics That Matter: How to Convince SaaS Investors with the Right Data Christoph Janz Partner Point Nine Capital

2. Metrics That Matter: How to Convince SaaS Investors with the Right Data What metrics you need to raise a Series A/B round How to pre-empt 90% of the data requests you’ll get in the DD process What investors will be looking for Some DOs and DON’ts

3. But First … Why? Why you should have your act together before you start fundraising meetings: If your data is self-explanatory , easy to understand , and aligned with what investors want to know , you’ll get much fewer followup questions , so you can run a faster process . Less time wasted on back-and-forth means you can talk to more investors , which is good, especially in 2024. Clean, high-quality data increases investor confidence .

4. #1 KPI Sheet & Financial Plan One spreadsheet with actuals and projections Depending on your stage, since launch or last two years Projections for next two years For earlier-stage or PLG companies, m/m usually best. Somewhat later-stage or with longer sales cycle, q/q.

5. #1 KPI Sheet & Financial Plan Start at top of your funnel and move down In PLG – usually visitors, trials , conversions . In enterprise SaaS usually MQLs , SQLs , new customers . Churn (logo churn and net revenue churn)

6. #1 KPI Sheet & Financial Plan Key financial metrics Revenue/MRR/ARR, CoGS, R&D, S&M, G&A, profit/loss Cash-in, cash-out, burn, money in the bank

7. #1 KPI Sheet & Financial Plan MRR/ARR movements New business , expansion , contraction , churn , sometimes reactivation

8. #1 KPI Sheet & Financial Plan Historic numbers and future projections should follow the same logic Keep it simple! But not too simple. ;-) Include key health indicators (e.g. CAC , burn multiple , ARR per head )

9. #1 KPI Sheet & Financial Plan What investors want to see: Growth (2-3x y/y at $1-5M ARR, 2x y/y at $5-10M ARR) Efficiency (burn multiple < 2-4x for earlier stage; Rule of 40-50 for later-stage) 100%+ NDR (or getting there) (unless consumer-y PLG with strong virality) Credible plan based on trajectory of the last months or quarters, aligned with how much you want to raise and with realistic valuation expectations (especially at Series B)

10. # 2 Cohort Analyses It’s the only way to get a sense for churn/retention , CAC payback , and CLTV . Look at customer cohorts and ARR/MRR cohorts . Also look at key usage indicators on a cohort basis (espcially if you’re early)

11. # 2 Cohort Analyses

12. # 2 Cohort Analyses Don’t mix monthly and annual plans. If you serve different types of customers, run cohort analyses per segment . If your overall retention isn’t great, zoom-in to your best-performing segment . Cherry-picking is fine as long as you can explain it What investors want to see: Excellent retention, at least in a segment Positive trends (e.g. more recent cohorts looking better than older ones; smiling cohort graphs)

13. # 3 Marketing & Lead Generation Spend, leads and conversions by source Costs per lead/trial/SQL/customer by source

14. # 3 Marketing & Lead Generation

15. #3 Marketing & Lead Generation Make it clear how exactly you’ve calculated CACs (e.g. if blended or by channel/source) You can exclude some start-up costs in your budget because you’re estimating the costs to acquire your next customer (but be transparent about it and don’t overdo it). What investors want to see: One source that’s clearly working and that seems to be efficient and scalable .

16. # 4 Sales & Pipeline

17. #4 Sales & Pipeline What investors want to see: Ideally, every quarter is a new record in terms of new pipeline added and closed-won. Are you disciplined when it comes to pruning pipeline?

18. #4 Sales & Pipeline What investors want to see: You seem to be able to hire and train AEs and get them to reach quota repeatably .

19. AI-related data Usage data , showing that your customers keep using your AI product or features and get real value Model performance , if you’re fine-tuning a model or building your own model Impact on unit economics (because of infra or humans in the loop) What investors want to see: Is there real usage and retention ? Are customers paying for it and do they keep using it? Can this become a profitable business ? Does it add to your defensibility ?

20. Key Takeaways Have clear, high-quality data ready to share before fundraising meetings. Have a logical, credible plan based on the trajectory of the last months or quarters. Investors are looking for growth , efficiency , and (especially at Series B) strong signs of a scalable GTM motion . Zoom in on segments (especially if your overall numbers aren’t awesome).

21. Related posts and materials

22. AMA about Fundraising in 2024 Christoph Janz Partner Point Nine Capital In the Braindate Lounge in 10 minutes

23. UP NEXT: SaaStr GTM Bootcamp: Hiring a Great VP of Sales the 2024 Edition Jason Lemkin Founder & CEO SaaStr