From SoR to SoE: How the new generation of SaaS companies uses technology, not data, to prevail

We've been closely following the emerging trends in the SaaS business model. Several of our customers businesses revolve around it and, as most other tech models, it is going through a transformative change. One of the most insightful articles we've read lately about this transformation  comes from Techcrunch. On November 13, our good friend and business school classmate, Sequoia partner Aaref Hilaly wrote a story smartly titled "Why the next great SaaS company will look nothing like Salesforce." In it, Aaref points out that the newest crop of SaaS models turns the notion that to be sticky, a SaaS model has to become the "System of Record" (SoR) which used to be "the single source of truth, for customers’ most valuable information, such as customer records or employee data" like Salesforce. He adds that the emerging opportunity for SaaS is to become “Systems of Engagement” (SoE), meaning apps that employees actually use to get their work done" like Slack,  one of the most "sticky" business applications, now the most valuable private cloud company according to Forbes.

Check it out here. Aaref's article is quite interesting and goes deep regarding how this new business model for SaaS not only makes sense, it solves the real problem of "creating systems of engagement that get users and revenue, by leveraging data in the systems of record."

Closed your A Round? Start Preparing for your B Round NOW with these tips.

This Thanksgiving week, Series A startups can be thankful for your funding, but realize that the B Round is now the tougher round and the time to start preparing is now.  This presentation by Jed Katz (https://www.linkedin.com/in/jedkatz), who is the managing director at Javelin Venture Partners (https://javelinvp.com) explains how to do that. Jed posits that your next round of financing is much closer than you think, which catches some Founders by surprise. To prepare, he gives tips on setting 12-month goals, making cash last, managing & leveraging your Board, creating separate roadmaps for Sales & Engineering, and using the right metrics. Note how creating a brand serves recruits and investors in addition to customers. We especially like his final "words of wisdom,” that, unlike the perfunctory summary in some presentations, are useful and action-oriented.

These are valuable tips from a VC pro who's seen everything. Check them out.