#36 - Write your SaaS Growth 📈

Build in Public, Usage-Based Pricing, 3x Your Revenue, Email Marketing, SEO Tips

Welcome to the 36th edition of Write your SaaS Growth:

In this edition, we discuss:

  • Build in Public: 5 methods to share your SaaS story in public

  • Pricing: 3 types of usage-based Pricing

  • Growth Marketing: How to 3X your SaaS revenue

  • Email Marketing: Get email marketing started with 5 simple steps

  • SEO: 10 tips from a decade of experience

Let’s GO!

Growth Tip of the Week! 🚀

Arpit says “it’s unclear why SaaS companies' revenue multiple was never benchmarked to the revenue multiple of IT companies. Yes, there should be growth premium, but given the similarities between the business models, there shouldn't be much divergence either.

Not the case in so many other industries - D2C brands can be benchmarked to listed brands, lending fintech are benchmarked to listed fin services, and so on.”

Well all of us couldn’t agree more Arpit! We as a SaaS community need to UP our exit multiples. Especially when you consider that building a SaaS from 0-$1k is the hardest.

Build in Public

Building in public can be beneficial for you as a SaaS founder by getting valuable feedback, building a supportive community, creating trust and transparency, and establishing thought leadership. It allows you to improve your product, attract customers and partner and position yourself as an expert in the field.

But building in public is difficult to implement and understand. Kunal shares 5 easy steps to start building in public:

  1. Learn a new skill in public. If you are just starting and have no skills The easiest way is to learn and talk about what you learn on social media This will allow you to build an audience who is interested in learning that same skill.

  1. Share your progress. No matter how small or big the milestone is Share it with your audience This will encourage them and get them curious to follow you along for what's next.

  2. Share the challenges you face and how you overcome them. Every small challenge you face, talk about it You will attract people on a similar path as you or a few steps behind you Share the problem, and what you are doing to overcome it.

  3. Monetize in public. Talk about a product you are building to help others get to where you are This could be creating a video course on how you went from point A to point B Your audience has seen you build in public with them They will trust your work and support you.

  4. Talk about your customer’s results in public. Create case studies of your clients solving their problems with your solution Or how your client was stuck at point A and working with you helped them get to point B This will attract more clients who want similar results

Do you find build in public challenging too? Don’t know what to tweet? I feel ya!

Pricing

I get a feeling that normal X$/month subscription pricing is not the best way to price your SaaS. At least going into 2023 and beyond. I have been on the lookout for some unique and creative pricing strategies.

Sameer (ex SendGrid) shares an interesting piece about usage-based pricing. This has been a magical driver of growth for SaaS businesses and to SendGrid. He explains three types of usage-based pricing:

  • Linear Model: A linear usage-based pricing model bills per unit, whether that unit is an API call, active user, or download. Customers are billed for their usage at the end of the period.Advantages:Disadvantages:

    • Simple to understand for the customers

    • Easy on your billing software and no complex APIs

    • Revenue is affected by season

    • Might disincentivize using the tool more fully

  • Volumetric Model: Volumetric model, customers purchase an allowance based on their expected use of the product. Then, when the customer exceeds usage allowance, the pricing rate changes.Advantages:Disadvantages:

    • Assures a minimum spend regardless of usage

    • Can use discounts as an incentive to increase usage

    • Customers may be unhappy to pre-pay

    • Customers may be frustrated if are on the border of two tiers and end up having to pay the higher cost

    • Transparency discount curve may be confusing for customers

  • Bundled Model: In a usage-based bundling model, the price per unit of use gets more expensive at higher tiers to reflect more features included. Advantages:Disadvantages:

    • Lower entry price for basic buyers

    • Creates a clear upgrade path

    • Allows you to monetize highly regulated or more sophisticated use cases

    • Carries significant overhead

    • Need to study your customers’ differentiated needs

    • Gating basic features may disincentivize customers from sign ups

You can read the full article with the SendGrid case study. Each type of usage-based pricing has its own sets of advantages and challenges. Are you willing to explore a usage-based pricing in 2023? 

Note: The correct answer will be shared in the next edition.

Growth Marketing

As a SaaS founder, revenue is crucial for you to ensure the long-term viability of your business. It is necessary to cover your operational expenses and to measure the success of your company.

Additionally, monitoring your revenue growth can help you identify areas for improvement and compare your progress with industry standards and competitors.

Focus on increasing revenue. It is a solid way to indicate product-market fit, customer satisfaction and the ability of your company to scale.

Matt shares a proven strategy to 3X your SaaS growth:

  1. Figure out high-paying projects and niche down: People who manage multiple projects from multiple industries frequently produce mediocre results across all the projects. Those who have a laser focus will always grow more.

  2. Define your niche with maximum revenue generation potential. Ex: A client in solar energy probably going to profit you more than a client in the temporary staffing industry.

  3. If you want big bucks you have to take big chances: Ask to get paid on performance not on effort, negotiate with your clients, and set a contract for the same.

  4. Align your skillsets to project requirements: Determine what your team can do best that can be useful to your customers. Build a great team with people who are exceptionally skillful in the necessary areas.

  5. Evaluate your strategy from time to time and reprioritize what’s working.

How is your revenue growth looking like? IMO, it is the most single important metric for a bootstrapped founder.

🚨 Founder Spotlight

My friend JR has just launched Beam Analytics. It’s a new GDPR compliant Google Analytics (GA) alternative! Why build this when so many others already exist? GA is not GDPR compliant. But he doesn't competes on this dimension. He says it should just be expected!

He feels GDPR compliance should be affordable. The best way to make GDPR compliance universal is to make it affordable. Beam is way cheaper than alternatives. Beam’s pricing is linear per usage and he doesn't just give you the standard web analytics GA gives. He also gives you two critical product analytics. All without any extra implementation. GDPR Compliant Web Analytics free up to 100k pageviews per month.

He’s currently looking for some beta users. If you find this interesting, hit JR up with a DM!

Email Marketing

As a SaaS founder, you may find email marketing a real challenge. Creating engaging content, building and maintaining a large email list, dealing with technical aspects and keeping up with the ever-changing trends can be time-consuming and frustrating.

It also requires consistent effort and attention, which can be overwhelming with all the other responsibilities you have.

Jeff shares 5 simple steps to start email marketing from scratch:

  1. Choose an Email Service Provider: There are TOO many options out there. You need a platform that is easy for YOU to understand, has a few automation capabilities (sequencing, tagging, segmenting), decent analytics reporting, and opt-in form capabilities That's it folks. ConvertKit is a fantastic, simple one.

  2. Gather a Few Subscribers: Ask friends, peers, colleagues, family. Don't be bashful. :) This is a great way to start emailing to your first 15-20 people. The point is to build momentum.

  3. Commit to 1 Email Per Month: Yep. That's it. Start small, commit to something easy. When you feel comfortable with that, bump up to 2 per month. And so on, and so on...

  4. Build a Lead Magnet: Once you get a few ppl on your list and you've committed to writing to them periodically... Start attracting your ideal prospects to your list. Do this with a lead generating asset.

  5. Write a Welcome Email: When strangers (prospects) start opting in for your lead magnet, it's really exciting! But you MUST welcome them when they sign up. Adding an automated Welcome Email is an easy way to demystify the "automation scaries"

That’s it! That’s all you need to do to begin email marketing for your SaaS product. Personally, the most important step for me is point 3. Commit to a cadence and it gets really easy from there.

SEO

Sam just completed a decade in SEO. He shares 10 lessons:

  1. If you ignore technical SEO, it's like driving with the handbrake on. No amount of links and content can make up for poor tech.

  2. Quality content is key, don't sacrifice it for the sake of quantity.

  3. SEO is constantly evolving. Always be open to learning and adapting.

  4. Don't rely solely on Google. Diversify your traffic sources. Google doesn't always get algo updates right. Great sites get demoted, and you'll need to wait for reversals.

  5. If you focus on user experience, you'll stay one step ahead of everyone else. What users want now is what will be in algos soon.

  6. Measure the right metric. If you want revenue and leads, work back from there to figure out the secondary ones that matter.

  7. SEO is a collaborative game. - Content writers - Developers - Brand managers - Project managers - C-suite (especially CMOs) You'll need great people in each role to achieve greatness.

  8. Don't be afraid to experiment and try new things. SEO is not a one-size-fits-all approach

  9. The value of long-tail keywords can't be overstated. It's an age-old tactic at this point, but it still consistently works every time.

  10. It's easier to rank for the long tail, and you can match specific user needs that match precisely match your service.

Thanks for reading! SaaSwrites is a humble attempt to help SaaS founders and marketers grow their SaaS.

See you next Saturday.

Ricky,

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