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.
Lazy NRR is Not NRR. Accept No Imitations or Substitutes
by Dave Kellogg
The beauty of Net Revenue Retention (NRR) is that it tells you want you want to know – once you acquire customers, what happens to them? – and you don’t have to care which of four churn rates were used. Or how churn ARR itself was defined. Or if mistakes were made in tracking flows…Lazy NRR is not NRR. NRR is defined as snapshot- and cohort-based. Accept no substitutes or imitations. Always calculate NRR using snapshots…
Gathering user feedback requires a different approach than customer feedback. Customers may leave reviews on social media or a third-party review site. You can also send out follow-up surveys to gather further information. This can all be collated by CRM software to give valuable insights, but more often than not these reviews reflect short-term usage or offer a view of the purchasing experience and not the product experience, which is what you’re after.
Similarweb sees these free tools as both brand and SEO plays. While traditional enterprise-focused software companies normally have a “contact us” barrier, Similarweb has a “try now” option where folks can immediately engage with the product. One concrete example is the Similarweb ranking tool, which brings up the top websites, search engines, iOS apps, browsers, and more. While this is an ungated tool available completely free of charge, it’s also an effective vehicle for generating leads. Similarweb’s goal is to understand who these users are and what they’re trying to accomplish, and then route them into the right offering for that specific use case.
How to Calculate Gross Dollar Retention
by Ben Murray
Recurring revenue is the engine of our SaaS business. We must monitor the health of this engine and adjust the engine if performance declines…Great retention provides consistent cash flows and more time to fix other issues in our business…Revenue retention is also a key due diligence item if you are fundraising or selling your company.
Client Success Story: A Marketing Team That Can Now Market
by Synthesis Technology
$27+ billion asset manager engaged Synthesis to automate their fact sheet production after failed attempts at automation with other vendors. The result?▪️ Quarterly time-to-market with updated collateral fell by 70%, with a corresponding decline in internal resource allocation
▪️ Because they were no longer focused on sales product support for 24 weeks a year (the total length of time spent managing quarter-end data production), the Marketing team could focus on core marketing functions
▪️ They were able to fully invest themselves in projects which added significant value to the firm’s overall brand
▪️ As a result, management approved higher budgets, more staffing, and a significantly broadened project portfolio.
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