Four key tips for SaaS start-ups

“What I find over time is that the best SaaS startups build custom, in-house data analytics that are particular to their use case”
– Mark Macleod

Investors love the scalability of software as a service (SaaS) companies, in particular when they’ve established a predictable, revenue-generating audience that’s measured and adjusted on a granular level. Mark Macleod, General Partner of Real Ventures (Canada’s largest seed venture fund) offered his thoughts on what investors look for and what startups should constantly look to fine-tune. Here’s a synopsis, followed by his full presentation.

• Why stakeholders prefer recurring billing over one-time licenses
• Why SaaS startups must be data-driven
• The hard and soft factors involved in a pricing decision
• The two reasons that customer pre-payment is essential

Mark’s four tips

Here’s a video of Mark’s SaaS discussion and presentation from our Best Practices series.

Mark’s MaRS Best Practices presentation

“Getting your pricing and metrics right is critical for any start-up, but doubly so for a recurring-revenue business. In this session, we’ll explore key customer metrics for new ventures, including acquisition, activation, conversion, churn and referrals. We’ll look at pricing in general and freemium in particular. Finally, we’ll examine valuations for software-as-a-service (SaaS) companies and how they compare with companies using traditional software license models.”

Here’s Mark’s slide presentation.