Imagine a world where founders brag about the growth they’ve driven, as opposed to their fundraising prowess.
The ability to raise capital is less impressive than finding sustainable ways to build a base of paying customers. Good coaching and a strong network can help many entrepreneurs land a big round, but that money reflects investor confidence, not market demand.
TechCrunch+ full articles are only available to members
Use discount code TCPLUROUNDUP to save 20% on a one or two year subscription
In an article for TC+, Curtis Townshend, Senior Director of Growth at OpenView, shares 11 product-driven growth tactics that drive “customer acquisition, retention, and expansion.”
After surveying 14 public B2B software vendors, Townshend says companies that built for discoverability and deployed usage-based pricing saw a median growth rate of 141%, compared to 21% for traditional SaaS.
These companies were also much more effective in terms of the rule of 40 and revenue retention. “Overall, the variance of the measurements is striking,” says Townshend.
The TechCrunch+ team is growing!
Tomorrow at 8 a.m. PDT/11 a.m. EDT, we’re hosting a Twitter space with new contributors covering climate, crypto, venture capital and more. To join the chat, follow @techcrunch on Twitter.
Have a good week,
Fighting the stigma of “copycats” in SaaS: 3 tips that work
Years ago I found myself at a party with someone wearing the same sweater, jeans and shoes, all the way back to the manufacturer. It looked like we came out of a clothing catalog.
At first it was funny. And then, as the other guests made endless jokes, it became annoying. We spent most of the evening avoiding each other and I couldn’t wait to leave.
Startups that lack first-to-market advantage face a similar conundrum, according to Sachin Gupta, CEO and co-founder of HackerEarth, who shares three ways “brands can fight the stigma of being a copy platform”.
The ‘unicorn glut’ theory of startup misery
The rolling green meadows of tech are seeing fewer new unicorns, but the downturn in the venture capital market suggests past mega-deals are making it harder for early-stage startups to raise funds.
“The biggest problem in venture capital today isn’t interest rates, earnings multiples or anything else,” SaaS investor Jason Lemkin tweeted yesterday.
“We’ve seen this before… what’s new (at least since 2001) is the massive overhang of growth investments that will take startups years to scale,” he wrote.
Via The Exchange, Alex Wilhelm agreed with Lemkin’s assessment:
“The glut of unicorns is making unicorn traffic jams worse, and as far as the eye can see, the vast majority of private market value is frozen.”
Building on their experience, insurtech MGAs are paving the way to insurtech 2.0
Innovation has long been a part of insurance: MGA management is the result of insurers requiring remote agents to have some independent underwriting and service capability.
Today, new insurtech startups developing MGAs are using lessons learned from their predecessors to make the industry more sustainable, writes Dave Wechsler, who leads insurtech investments at OMERS Ventures.
“MGAs are course-correcting, and the next generation of challengers are entering with new principles based on that knowledge.”
To better manage cybersecurity risk, extend zero trust principles to third parties
When it comes to cybersecurity, it’s no longer enough to have your own house in order – 81 individual third-party incidents led to more than 200 publicly disclosed breaches and thousands of ripple effect breaches throughout 2021, according to a Black Kite report.
Companies should also assess the cybersecurity risk of third-party vendors before signing deals, writes Saket Modi, co-founder and CEO of Safe Security.
“Companies must establish zero-trust principles for all vendors, assess risks on external and internal assets with in-depth assessments, and measure cyber risk in real time.”