The first instalment in our Xanax for SaaS Execs 3-part series, we're sitting down with a number of company executives to discuss how to navigate growing pains so that they aren't keeping you up at night.
What keeps SaaS executives up at night, and how can they get a better night’s sleep?
The Software-as-a-Service (SaaS) landscape continues to grow exponentially, and Canada is no exception. Investment in Canadian SaaS companies reached $1.62 billion in 2018 across 229 deals, up from $1 billion and 100 deals in 2017.1 The Canadian cloud economy contributed an estimated 8.2 billion to Canadian GDP in 2018, up from 4.6 billion in 2013.2
And the nation’s capital leads the country – and North America in fact – with the highest concentration of high-tech labour as a percentage of its workforce at 11.2%.3 It boasts a vibrant mix of incubator organizations including Invest Ottawa, LSpark, OneEleven, and the Kanata North Business Improvement Association. In only its 3rd year, Ottawa’s 2018 SaaS North conference drew 1500 entrepreneurs from 500 growing companies. And the SaaS Ottawa Meetup group boasts just over 800 members.
All of this investment, support, and growth is a great news story for Canadian SaaS companies, as well as non-SaaS companies dipping their toe in SaaS waters for the first time. However, as you might expect, growing pains are causing SaaS execs some sleepless nights.
I’ve had the opportunity to sit down with a number of SaaS company founders and senior execs to learn what’s keeping them up at night, and what they’re doing to get a better night’s sleep. I’ll share insights from those conversations in a series of blog posts. I’ll also add in gems from SaaS North, where a number of founders and CEOs generously shared lessons learned along their journeys.
Typical Advertising Doesn’t Work For Us, We Need New Ways to Attract Customers
I heard this across B2B, B2C, new startups, and more mature players who’ve been through multiple rounds of financing.
|Influitive’s founder and CEO, Mark Organ shared his take at SaaS North on why advertising is less and less effective. Simply put, he explains, our trust in institutions has eroded to the point that we don’t believe governments and corporations anymore. He used two great quotes to underline his message:
“Trust not technology, is the issue of the decade.” – Tom Peters
“If you do build a great experience, customers tell each other about that. Word of mouth is powerful.” – Jeff Bezos
So instead of advertising, Mark says focus on making customers successful. Then they’ll become your advocates. Which is much more effective than advertising.
|Tehama’s SVP Gene Villeneuve explained that because Tehama is creating an entirely new category to secure and simplify IT service delivery for vendor management and IT service delivery organizations, it’s not easy to explain what they do using traditional advertising.
Instead, Gene and his leadership team are influencing the influencers – helping educate them on the unique two-sided market that Tehama creates with corporate customers and service providers. They’re also sponsoring and attending specialized events such as the MSP Expo in Fort Lauderdale to drive up brand recognition with a very specific set of attendees.
|Cinchy’s Head of Marketing, Chris McLellan, who is out to help Cinchy define the Data Collaboration enterprise software category, highlights a similar approach.
Rather than invest precious early cash in advertising, Cinchy is splitting marketing efforts between developing their category online and establishing the thought-leadership of Dan Demers, Cinchy’s CEO.
Both efforts are using varied creative, distribution, and partnership approaches with traditional paid digital playing only a minor role.
In sales, Cinchy made the effort to secure a top-tier first customer, TD Bank. That credibility and stamp of approval helped them secure $3M in initial funding to fuel their next stage of growth, and will continue to open doors for them in the North American financial services sector.
|Wicket Co-Founder and COO, Laura Mindorff, explained that they simply don’t have a large budget to invest in advertising.
Instead, one of the things they’re doing is partnering with larger players like Klipfolio to host mutually beneficial events to expand their reach and influence.
And it’s working! A number of key associations have already selected Wicket, with many more in the pipeline to come.
|Lastly, Klipfolio Co-Founder Allan Wille revealed that given Klipfolio’s relatively low overall lifetime customer value in the B2C space, they just can’t afford to invest in advertising.
Instead they’re looking to the power of referrals and advocates to sign up new customers, which back to Mark’s insights, has the added benefit of being more trusted than institutional advertising.
At the end of the day, despite the fact that typical advertising doesn’t work for a growing number of SaaS companies, they’re not letting this slow them down. Instead, they’re coming up with creative approaches that resonate with their customers and business models. And as a result, they’re getting a better night’s sleep.
Be sure to subscribe to our blog “Collected Management Wisdom” to make sure you get the second pill around customer service and customer care -“The Faster Your Grow, The More Focus Needed on Customer Care.”
Canadian SaaS Companies Secured Over $1 Billion of Investments in 2017 (BrainStation)
- CANADA’S CLOUD IMPERATIVE: Improving Business Opportunities Through Enabling Services (ICTC) via LSpark
New study rates Canada’s best cities for tech talent (CIC News)
This article was published more than 1 year ago. Some information may no longer be current.