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 week.

A B2B SaaS CFO’s guide to Customer Acquisition Cost (CAC)
on OPEXEngine

Fast growth SaaS companies under $50M in revenues have a median 87% increase in new customers a year. Fast growth SaaS vendors over $100M average 25-30% increase in new customers annually. There has been much focus on net dollar revenue expansion within existing customers in recent years, but there is only so far that your existing customer base can take you financially. For this reason, SaaS companies typically are aggressively seeking new customers, and SaaS CFOs need to be acutely aware of the total expense to acquire new customers.

10 Ways to Excel in the Evolving Role of the CFO
on NetSuite/Brainyard

In the NetSuite survey, only 27% of respondent companies classify themselves as ‘data-driven’ compared with 23% saying they’re ‘intuition first’ decision-makers…An analytical, data-driven perspective is invaluable in conversations about, for example, marketing or product development. Finance leaders are usually best suited to apply a fiscal lens to decisions, Cook said, and should also be internal advocates for a data-driven approach, encouraging others to incorporate numbers into their decision-making.

Generating Inbound Leads with Outbound Sales Messaging
by PredictableRevenue

1)…build a useful piece of content, like a checklist, calculator, or no-code utility. Then use that free resource in your prospecting….make sure you don’t pull a bait and switch where you give something away for free and then immediately turn around and ask for a meeting…
2)…build a community for your ideal clients, and then invite prospects to join that community…
3)…host a challenge.

How to Measure Value Realization
by ChurnZero

…value realization affects customer loyalty and retention, customer satisfaction, referrals and recommendations, and opportunities to upsell…Learning how to measure value realization is different from tracking other metrics, such as customer lifetime value or customer acquisition cost, which are tied directly to a formula. With no set formula, it takes work to define and understand how to measure value realization…

5 Interesting Learnings from Zscaler at $1B in ARR
by Jason Lemkin

Zscaler is growing faster at $1B in ARR (63%) than it did at $500m in ARR!
Sales + Marketing declined from 59% of revenue to 47%.
10 Years to $100m in Revenues. Then Just 5 More To $1B in ARR
125% NRR, and NPS of 70
$100k+ ARR customers fuel growth. They are growing almost as quickly as revenue

Continuous Discovery and Continuous Benchmarking
by airfocus

Continuous discovery helps product teams evolve and refine their ideas in a customer-centric way. It encourages the product team to continually search for new information about user needs…The payoff can be great, but there are risks involved, too. The introduction needs to be handled carefully to reduce disruption and continuous discovery requires continuous maintenance by product managers.

A look back at entrepreneurial lessons learned and the rise of net revenue retention with ChurnZero CEO You Mon Tsang
by ChurnZero

If there was a great SaaS company starting out 10 or 15 years ago that focused on renewal before growth, they’d have built an enduring, incredible company that’d be healthier than all the companies out there today. There was the realization that net revenue retention is the most important metric you can have and you better focus on that.

The Pipeline Progression Chart: Why I Like It Better Than Just Tracking Rolling Four-Quarter Pipeline

by Dave Kellogg

The most fun part of this chart is this you read it diagonally. The $7M in starting this-quarter pipeline at the 7/1/21 snapshot is largely composed of the $6.5M in next-quarter pipeline at the 4/1/21 snapshot and the $3M in pipeline at the 1/1/21 snapshot. You can kind of see the elephant go through the snake.

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Blue Horizon acquires and invests in profitable software businesses with stable recurring revenue streams. The Blue Horizon platform combines long-term capital and industry expertise with an operating model that enables businesses and their leaders to focus on growth and profitability.