Blue Horizon’s reading list is a curated collection of articles for SaaS founders and management teams. We are entrepreneurs and operators who have lived through the process of founding and scaling software companies. Here are the articles and resources we found useful this month.
Simple Strategic Plan for 2023
by David Cummings
The simple strategic plan, just like it sounds, is a high level overview of the business and the critical elements of the company. The goal isn’t to be a comprehensive, detailed write-up of all aspects of the enterprise. Rather, the goal is to get everyone inside and outside the company on the same page with as much clarity and concision as possible. Put another way, if you could only use 250 words to tell someone about the business, this is the best formula to do so. Now, here’s the outline of the simple strategic plan:
▪️ Core Values
▪️ Brand Promise
▪️ Elevator Pitch
▪️ 3 Year Target
▪️ Annual Goals
▪️ Quarterly Goals
▪️ Quarterly Priority Projects
The right strategy to win means reassessing fundamental issues like the product-market fit and centering on the best ICP. For companies in B2B SaaS, it also means understanding to whom they’re selling. Doing so ensures that the ICP is not solely focused on accounts with the lowest CAC but also targeting accounts with high LTV to foster long-term sustainable business and revenue. Putting more emphasis on ICP may seem rudimentary, but it can have tangible benefits, including ensuring healthy gross margins.
The chief customer officer role will become increasingly critical in 2023 as companies focus on retaining and expanding relationships with their existing customers. Results delivered this coming year by post-sale executives will cement the value of this position on the executive team. This means that CCOs and aspiring CCOs need to understand and master the skills to be successful in their increasingly visible and high-impact roles.
What Does Product-Market Fit Feel Like?
by Predictable Revenue
Reaching product-market fit is the first ‘only thing that matters’ goal for a startup, but once you find it, go-to-market quickly becomes the next ‘only thing that matters…’ This is a common pitfall we’ve seen founders run into; they have some semblance of product-market fit and then start investing heavily in a go-to-market motion before they have their hands around exactly who they need to go after and why.
Startup Valuations as Rule of 40 and Market Sentiment Multiples
by David Cummings
Rule of 40 Score is basically growth rate plus profit margin as numeric values. The easiest way to get profit margin up (or less negative) is through layoffs, and we’ve seen huge numbers of them lately. Much like “animal spirits” from John Maynard Keynes, market sentiment here is subjectively and fluctuates regularly. While this formula isn’t perfect, it’s directionally useful in today’s market.
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