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Challenges & Opportunities for Vertical B2B SaaS Companies
Gregg Scoresby, CEO at CampusLogic@greggscoresby
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What is It?
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“Focusing on niche verticals or specific functional areas may be one of the most successful
strategies of the enterprise cloud software era…the vast majority of successful cloud solution providers have struck gold by picking one thing
and doing it extremely well." (Gordon Ritter, founder of Emergence Capital)
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What We’ll Cover Today
✛ 3 Opportunities for Vertical SaaS
✛ 3 Challenges for Vertical SaaS
✛ CampusLogic Case Studies
✛ Principles as Opposed to Rules
✛ Q&A Throughout
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#1: Sales & Marketing Efficiency
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I’ve been hearing about CampusLogic, should we be looking into
this?
Know Your Buyers
Dir Fin AidChampion
VP Enrollment or Student Services
Buyer
ITInfluencer
C-LevelInfluencer
All of my processes are
manual and time-consuming, is there a better
way?
I’m looking for ways to improve enrollment and
the student experience.
What will it take from IT to
implement this?
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Go Where Your Buyers Are
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Engage 100% of The Market
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Don’t apply horizontal sales and marketing strategies to vertical
SaaS companies.
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#2: Superior Economics
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More Revenue Per Account
$-
$5,000
$10,000
$15,000
$20,000
$25,000
$30,000
$35,000
$40,000
ARPA
52% ARPA Expansion
✛ Communicate Value
✛ Right features
✛ Better pricing
✛ More product
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More Valuable Relationships
✛ Growing ARPA
✛ Low churn
✛ Deep relationships
✛ Giant LTV
$-
$100,000
$200,000
$300,000
$400,000
$500,000
$600,000
$700,000
LTV
77% LTV Expansion
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More Profitable Customers
✛ Invest early &
often
✛ Obsess about
churn
✛ Be consultative
✛ Create community
Target: 80%+ GM
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Better Customer RetentionTarget: >115% Net Retention
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Public vertical SaaS companies have ~30%
higher EBITDA than horizontal SaaS
businesses
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#3: Deep Data Analytics
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>75% of have BI somewhere
on campus
0% use BI tools in student finance
No Shortage of Analytics Tools
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BeyondVisualizations
✛ Who isn’t completing the fin aid process?
✛ Which students are over-borrowing?
✛ What content enables lower borrowing?
✛ Where are students disengaging?
✛ How do we compare to other schools?
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Become THE data source for your vertical and use it to make your industry and
your customers better.
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#1: Small Markets
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An Typical Investor’s View
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Launched Beta VersionOf StudentVerification
$75M
2013 Total Addressable Market
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Expanded SV, rebranded as StudentForms$180M
2014 Total Addressable Market
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LaunchedAwardLetter$250M
2015 Total Addressable Market
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LaunchedCampusMetric
s$325M
2016 Total Addressable Market
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Acquired Net Price
Calculator$375M
2017 Total Addressable Market
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Launching Scholarship
Universe Fall 2017$500M+
2018 Total Addressable Market
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Domination Required
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Prove that you can grow your addressable market
everyday, every week, every month, every year.
And then dominate it.
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#2: Domain Expertise Needed
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Vertical SaaS Founder Profile
✛ Personal connection with the industry
problem
✛ Understanding of how customers deal with
it
✛ Ability to source early customers
✛ Knowledge of other players and their
position
✛ Obsession with fixing the problem
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Go Deep on Differentiated Product
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Generic Forms vs. CL StudentForms
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Consultative Customer Success
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Be an industry expert.Then hire industry experts
into product, customer success, and most everywhere else.
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#3: Churn Will Crush You
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Every Fish in the Pond will Know
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100% Referenceable
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What Do They Really Think?
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Make Them Feel Special
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Obsess about customer happiness and the value
they get from your products. And make them look like
rock stars.
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