SaaSletter - Best Content Of 1H 2024

Industry Reports

G2 released their “2024 Buyer Behavior Report ” (n = 1,900+ software buyers; 39 slides) with some excerpts above and threaded here . But go read the whole G2 report .

“SaaS Account Executive Report ” - from The Bridge Group . The long-term quota trend (2012: 74% → 2024: 51%) is likely the most notable slide with other excerpts previewed above.

Ebsta (a revenue intelligence platform) and Pavilion published an authoritative “2024 B2B Sales Benchmarks ” report (28 slides covering 530 companies across all of B2B, not just software, $54 billion of revenue, and 4.2 million opportunities) that was so good I set up a report deep-dive podcast with their CEO Guy Rubin . More in our “Too Little Value Selling ” edition. Notable findings:

• 17% of reps drive 81% of revenue
• Top reps are 9x more productive today versus a 4x-6x gap earlier
• 61% of deals are lost to no decision

Scott Brinker (an Episode 14 podcast guest ) and Frans Riemersma released their 101-slide “ State of Martech 2024” report (excerpts pictured above)

Zylo (software to manage software spending; $34 billion of spend under management; h/t Meredith Albertson ) released their 2024 SaaS Management Index report (30 pages). A few highlights:

• Average Spend Per Org: 2021: $60m → 2023: $45m (25% decrease in 2 years)
• Average Utilization Rate: 49% → Average Waste of $18m / org
• 72% of SaaS spend occurs outside of IT control
• Average Spend Per Employee: 2022: $4,621 → 2023: $3,916 (14% YoY decline)

From + For Investors

From David Yuan + team at Tidemark :

• “Market Structure Drives Strategy ” - Email required… but worth it
• “The Single Product Ceiling ”

"Needles and Haystacks: Which GTM Practices are Actually Best Practice? " - a great tactical report from Insight Partners .

Ray Rike + Benchmarkit ’s 2024 SaaS Benchmarks (n=936 companies) warranted our own update of 2010-present SaaS historical benchmarks:

Special thanks to Bowery Capital for offering me the opportunity to pontificate a few times:

• “State Of The Industry ” - with my slides on SaaS as a maturing growth industry that is fortunate to have AI
• “SaaS Perspectives ” - my Q&A with Patrick McGovern on new logos, AI, and what type of software I would recommend building today

My quick excerpts from Sapphire Ventures ( Steve Abbott + team)'s very comprehensive (71 slides) "State of the SaaS Capital Markets" report

Battery Ventures ’ “State of Enterprise Tech Spending ” report (n = 100 CIOs, $35b of tech spend) With my full excerpts threaded here

“BVP State Of The Cloud 2024 ” - in terms of AI, I found the 65% gross margins notable. See my earlier coverage of gross margins in “Coatue on AI -> SaaS Read Throughs ”

“InfraRed Report ” - Redpoint released its annual 56-slide review of infrastructure software - my InfraRed 2024 excerpts here

“SaaS Perspectives ” - via my appearance on Bowery Capital ’s new blog interview series

From Jared Sleeper :

• “SaaS Isn't Dying: It's Going Logarithmic ”
• “Beware the Banana Stands: Silicon Valley’s Incinerators of Capital ”

Chips Ahoy Capital ’s comprehensive and must-bookmark study: “Benchmarking Multi Product Penetration in Software ”

Software Equity Group ’s “20 Factor Valuation Scorecard ” from above deserves more attention

Our Primary Research

Special thanks to G2 (h/t Palmer Houchins ), Brex (h/t Art L. + Matt Torman ), and RepVue (h/t Adam Little ) for their collaboration and data on these research deep dives:

AI-Centric Content

[NEW] “Mapping the impending impact of Vertical AI ” (152 pages, email required) - from Marissa Moore, CFA and Taku Murahwi of OMERS Ventures

Buck on Software published a very thoughtful “Winds of Change ” post

“AI’s $600B Question ” - David Cahn from Sequoia Capital updated his formula (table above) that addresses the “gap between the revenue expectations implied by the AI infrastructure build-out, and actual revenue growth in the AI ecosystem, which is also a proxy for end-user value.”

Meanwhile, Barclays published its own take on AI CapEx ROI

麦肯锡 ’s AI reports have gotten lots of clicks:

• “Navigating the generative AI disruption in software ” - by Jeremy Schneider , Tejas Shah , and Joshan Abraham - my excerpts here
• “In search of cloud value: Can generative AI transform cloud ROI? ” - while a November 2023 report, it was covered in our January 3rd edition “McKinsey on Cloud + AI ROI ”

AI investors Nathan Benaich ?+ Alex Chalmers from Air Street Capital have had a good, sober series of essays:

• “Alchemy doesn’t scale: the economics of general intelligence ”
• “Chips all the way down ”
• “Alchemy is all you need: On the economics of frontier models ”

“Parallel Bets, Microsoft, and AI Strategies ” - from Matthew Ball

Recurring Report Recommendations

Underfollowed recurring reports that you should subscribe to:

• Software Equity Group M&A Reports from Software Equity Group
• ChartMogul Monthly Benchmarks from ChartMogul + Nick Franklin + Sofia Faustino
• RepVue Cloud Sales Index
• B2B SaaS Marketing & Revenue Benchmarks from HockeyStack
• Scale Venture Partners Flash Updates from Scale Venture Partners

Operator Perspectives

A few 1H 2024 recommendations from the prodigious Dave Kellogg :

• “Playing to Win vs. Playing to Make Plan: The Two Very Different Worlds of Silicon Valley ”
• “Six Principles to Optimize Your Results and Your Career (With Presentation Slides ) ”
• “How to Detect if Your Startup Has a Faux Focus ”

2 picks from OnlyCFO 's 1H 2024 content:

• “Winning Software Budgets in 2024 ”
• “Is SaaS Math Broken? ”

The Deal Director (a good sales practitioner newsletter) had a good write-up on Samsara’s use of ROI in their successful GTM

Mark Roberge’s updated “Science of Scaling” (96 slides)

Thoughtful takes from CJ Gustafson on NPS: “Is Net Promoter Score the Ozempic of Metrics?”

“What I learned selling my company ” - Harry Glaser had a thoughtful and tactical post on M&A 4 years after selling Periscope Data to SiSense, with video and slides from a related “SaaStr Workshop Wednesday”

Our 1H 2024 Podcasts

We are incredibly thankful for our wonderful guests. 1H 2024 episodes here:

“Sales in 2024: SaaS AE Metrics Report ” - Sally Duby from The Bridge Group

“2024 B2B Sales Benchmarks ” - Guy Rubin from Ebsta

“Sales AI Founder ” - Matt Slotnick , a Co-Founder + CEO of Poggio

“Martech in 2024 ” - Scott Brinker from HubSpot

“SaaS M&A 101: Selling Your Software Company ” - Diamond Innabi from Software Equity Group (SEG)

“An Operating Partner’s POV on Value Creation ” - Paul Stansik of ParkerGale Capital

“Vertical SaaS Investing Playbook ” - David Yuan from Tidemark

“AI + Software Investing in 2024 ” - Akash Bajwa from Earlybird Venture Capital

and I am always grateful for the opportunity to pontificate outside of our podcasts. Thanks to these folks for giving me a platform with my appearances here:

• My episode with Zylo and Ben Pippenger
• My episode with Jon Russo and Megan Heuer
• My episode with David Dulany from Tenbound

About Cloud Ratings

In case you missed it, we recently announced a research partnership with G2 - more here:

with this slide showing how our G2-enhanced Quadrants , this newsletter, our podcasts , and our True ROI practice area all fit within our modern analyst firm: