Workshop Wednesday: The New Era of HyperFunctional SaaS

The New Era of HyperFunctional SaaS
Jason Lemkin, Founder & CEO @ SaaStr

1. The Bar Has Gone Up.
The New Era of HyperFunctional SaaS.
Jason Lemkin
Founder & CEO
SaaStr

2. Sorry -- But There’s No Downturn. It’s A New Normal.
Good Times:
●Cloud spend +20%
●Non-Tech Use Cases Strong
○Toast +29% at $1.5B ARR
○Monday +34% at $1B ARR
○Shopify +21% at $8B ARR
○Klaviyo + 35% at $900m ARR
○Samsara +36% at $1.26B ARR
●AI Strong
○Google Cloud +29% at $10B ARR
○Azure +30% at $81B ARR
○GitLab +30% at $730m ARR
●Security + Compliance Strong
○Crowdstrike +34% at $4B ARR
○Rubrik +35% at $920m ARR
○OneStream IPO +37% at $500m
Challenges:
●Salesforce +9%
●Mongo +13%
●Elastic +18%
●Asana +10%
☀ ??????

3. 2024-2029: The New Era of Hyperfunctional SaaS

●AI Now Table Stakes.
●And Product Has to Much Better For It.
●Radical Efficiency, At Least Post-IPO
●Automation Everywhere
●Multiproduct The New Normal
●Customers Demanding Much More Than a 10x Point Solution

4. AI Is a Force of Nature. It’s Also … Table Stakes in SaaS
A ton more work, a ton more functionality, in the end probably for the same
ACV. Oh and yeah -- all the competition is doing it as well. It’s harder. Cry me a
river.

5. The Bar To a Truly Great Product Is Way, Way Up
Customers expecting:
●to replace 30%-50% of workforce with AI
●all unstructured data to now be instantly structured and searchable
●every product to work in a plain english prompt
●even complex onboarding to be fully automated
●core platforms to do the work of 20 add-ons and point solutions
And they are being promised this. Often over-promised, but still.
AI has taught everyone this is “easy”. Customers now demanding it.

6. Radical Efficiency Is The New Normal
This means even more product with fewer
resources

The New Normal: 20%+ Margins at $1B ARR
The New Normal: 700 FTEs at $200m ARR

7. Automation Everywhere
Workflow + dashboard aren’t enough
AI is Automation on Steroids
Much of the enterprise (and SMB) AI spend is
on automation 3.0
The AI Bubble may pop (AI spending like in
SaaS in 2021) -- but customer expectations
are forever changed

8. MultiProduct is Now the Norm. Gotta Start Much Earlier.

So many at $50m, $100m, $200m ARR are
now seeing growth slow to < 20%. And net
new customers often close 0%

Why? They’re still really Single Product

Might quietly be Issue #1 across SaaS today

9. Death of the Point Solution?

Maybe, maybe not. But seems like it.

Leading vendors all doing more and more.

At a minimum, you have to step it up at least
to scale.

Customers are expecting HyperFunctionality

10. AI = Point Solution Explosion

Now 100x more vendors in some
spaces than 18 months ago

They are promising 10x or better
functionality via AI

11. Who Will Do The Work?

Founders as driven as ever … but
what about the rest? Do most of the
rest really want to do the work of a
startup?

A challenge for all of us

4 of 813 raised their hand …

12. Go Find Your
Monday

13. Q+A