This document discusses benchmarking SaaS startups and their growth trajectories. It provides examples of successful SaaS companies like Box, Hubspot, and Marketo that reached $100 million in revenue within 7-10 years. It emphasizes that early growth is critical, with companies needing at least one 3x year of growth and then 2x growth each subsequent year. The document also presents case studies of TalkDesk, which grew from $150,000 to $2.5 million annually in 12 months, and GuideSpark, which grew from $1.5 million to $20 million over 24 months after an initial struggle.

1. Benchmarking SaaS Start-Ups:
How Am I Doing?
Really?
Brian Jacobs
General Partner, Emergence Capital
@brian_emcap
Jason M. Lemkin
SaaStr; Managing Director, Storm Ventures
@jasonlk

2. Brian Jacobs
Founding Partner, Emergence Capital
Investors in Salesforce, Successfactors,
Veeva, Yammer, Box, InsideView, ServiceMax,
Bill.com, EchoSign, Hightail, Lithium, etc.

3. Jason M. Lemkin
SaaStr Founder Community – 1m Views/Mo
Managing Director, Storm Ventures
Founder/CEO – EchoSign/Adobe
Investors in MobileIron, Marketo, EchoSign,
GuideSpark, Metacloud, Sandforce, etc.

4. Benchmarking – What We’ll Discuss
•The Journey
•The Numbers: The Good, The Bad and the Ugly
•Funding: Who Gets Funded, & Why
•The Live Case Studies:
– Early-ish Stage: TalkDesk: $150K to $2.5m ARR in 12 mos.; the next phase
– Growth Stage: GuideSpark $1.5-$20m in 24 Mos. (but it took a while to get there)

5. The Journey
What Matters – And What Doesn’t
• The Best SaaS Companies Get to
$100m in 7-10 Years
• Outliers are rare: Workday, Salesforce,
DropBox, but few others
• Pace to $100m:
– Box: 7 Years
– Hubspot: 8 Years
– Marketo: 6 Years
– Zendesk: 8 Years
– MobileIron: 6 Years
– Veeva: 5 Years ($1m+ ACV)
– LinkedIn: 7 Years

6. The Journey
What Matters – And What Doesn’t
• But … Really Doesn’t Matter How Long it
Takes You to Get to Initial Traction (first $1-
$1.5m)
• Some get there in 1 Year. Some take 3+
Years (GuideSpark). It doesn’t matter – if you
are committed.
• Key is Not to Burn Out Around Year 4-5

7. The Journey
What Matters – And What Doesn’t
• After Initial Traction, Growth Rate is Critical
• Then …
– Best SaaS Companies go $2-$10m ARR in 5
Quarters or Less (>=15% MoM); 20% Outlier
– Key is Momentum as pass $10m ARR (100%+
Growth Once Cross It)

8. While Most Attention is Focused on Latter Stage Growth of
Public/Acquired SaaS Companies…
get to $10m … Average $10m to $100m in 4.7 Ys.
…Early Stage Growth is Arguably More Important

9. This is Why: You Need One 3x Yr, And Then >=2x Each Yr

10. Top SaaS Players Grew Quickly Pre-$10M in Revenue
Annual Revenue
Growth Before
Achieving $10M in
Revenue
Max: 983%
Target Range
Mean: 291%
Min: 36%

11. Without Sacrificing Sales Efficiency
Average Sales
Efficiency
Before
Achieving
$10M in
Revenue
Note: Sales Efficiency = Change in Yearly Revenues / Previous
Year’s Sales and Marketing Spend
Max: 512%
Target Range
Mean: 164%
Min: 45%

12. The Live Case Studies: TalkDesk and
GuideSpark
Potential Outliers

13. Talkdesk: Getting to 20% MoM Growth – From Nothing
From Hackathon, to Product-Market Fit
• Talkdesk – Top Desk.com Partner
• Call/Contact Center in the Cloud
• History:
– Started off winning Twillio & SFDC hackathons
– Then productized
– Then monetized
– Hit Initial Traction ($1.5m) 16 mos. After Launch –
with increased velocity (20%)
– On pace grow $1m to $10m in < magic 5 quarters

14. Talkdesk: Getting to 20% MoM Growth – From Nothing
From Hackathon, to Product-Market Fit
• Q&A
• Keys to igniting growth:
– Partners and integrations (takes time)
– Driving ACV and deal sizes up (to six figures)
– Upgrades key: < 20% of target ACV bought upfront
today
– Understanding how do true enterprise-grade
implemenations --- even for SMBs :)
– Pricing for value
– Lead growth > Revenue Growth = VPS + Raise $$$

15. Talkdesk: Getting to 20% MoM Growth Post-Initial
From Hackathon to Product-Market Fit to Outlier
• Brian Jacobs:
• Would you do the Series A?
• Is It In the Ballpark vs. Other SaaS
Investments?
• Why or Why Not?

16. Case Study #2: Guidespark: 5 Years to Outlier
Three+ Tough Years to Initial Scale. Then – Acceleration.
• GuideSpark: Employee Communications in
the Cloud – Instead of In-Person
• History:
– Started off as more generic e-learning platform
– Struggled for product-market fit until found one core
use case, and one core enterprise customer
– Doubled down on (x) enterprise + (y) employee
communications
– Hired their Great VP of Sales at ~$1.5m ARR – once
real business model proven and first enterprise
customers closed

17. GuideSpark: Outlier Growth Post-Initial Scale
A Long Journey to The Top
• Brian Jacobs:
• Would you do the Series C?
• Why or Why Not?

18. Come To Dreamforce to See the Rest!
Wed Oct 15th! @ 1pm
http://bit.ly/saastrdf