Guest post- What I Learned at SaaS University by Robert C. Johnson
Hi, I’m Robert Johnson from teamsupport.com- I won the competition for the pass to the SaaS University in Dallas last month and while I would have rather won a $100 million lottery, I didn’t complain… I promised Justin I’d write a lessons learned post, so I can share my learnings with you- and here it is….
Frankly, I would not have attended the seminar if I hadn’t won the ticket. It was a significant time and money commitment (2 days and $1,000), but in retrospect I’m glad I was able to attend.
It was a jam packed two day session which started with a keynote presentation by Peter Coffee of SalesForce. Obviously SalesForce is pro-SaaS and Peter enumerated the reasons we all know why SaaS is poised to take over the world.
Afterwards, Rick presenting some highlights from SoftLetter’s SaaS survey. This survey was sent to a large number of SaaS companies, including mine, and ends up being a “best practices” guide that helps all SaaS companies measure against ourselves. One of the most interesting things to me was on the marketing side – Apparently Webinars really work! Of the various methods SaaS companies use to market themselves, the webinar method appears to be one of the best (note to self: Set up a webinar program for TeamSupport…).
Once the two keynotes were finished we broke out into some smaller groups and split tracks. I won’t go through the details of all the presentations over the two days, but I will share a few highlights below:
- Pat Fetterman from Plex Systems (an ERP provider) gave a fascinating presentation about how they charge customers for new feature development. It’s a brilliant idea, and one I would have loved to have implemented in my last company. I suspect this idea only works when you are dealing with a semi-customized product in a very defined vertical, but it’s a heck of a good idea and one way to help revenue growth.
- Michael Whitener of Vista Law gave a nice presentation on some of the legal issues regarding SaaS and selling enterprise level deals. One key takeaway was that most corporate legal departments have no idea what SaaS is and they don’t have boilerplate agreements in place. His recommendation, which makes a great deal of sense, is to have a enterprise sales agreement ready to go so you’re not stuck with having to modify an agreement for perpetual license software.
- While I only caught the tail end of it, Ted Finch of Chanimal.com had an interesting presentation on building a reseller channel. This is something we’ll be implementing in the near future.
- Lincoln Murphy of 16Ventures is a well known presenter and he didn’t disappoint. He spoke on the “Network Effect” and how to get more value out of a SaaS offering. The idea basically is that with a multi-tenant architecture, you can extrapolate a lot of your clients data and either resell it in aggregate or use the metric data to better help your existing customers. It makes a great deal of sense, but of course you need a critical mass of customers to make it work.
- Rick Nucci from Boomi spoke about their product and integration between SaaS vendors in general. This is a hot topic, and I want to follow up with Rick on some of their technology.. While it was a bit of a sales pitch about Boomi, for some reason this one didn’t bother me as much as some of the other presentations – Rick did a nice job of talking about integration in general and the challenges we all face.
As I said, it was a busy weekend and I’m sure I missed some worthwhile information, so don’t take the above list as comprehensive.
While the two days was well spent, I think there were a couple of areas that could have been better represented. The most surprising and notable thing to me was that while there was a great deal of technical talk (including some veiled sales pitches), there was no conversation at all about customer service.
Admittedly I’m hyper-sensitive to this since I believe that you can’t build great companies without great customer service, and of course I run a customer service application company. However, I don’t think you can have a two day conference about SaaS and not have a long and frank discussion about customer service, managing customer expectations, getting rid of expensive customers, etc. As we all know, success in SaaS is in great part measured by our lack of churn, and churn can be lowered with excellent customer service.
All in all, it was a good two days and worth my time. Rick has a wealth of data about SaaS operations, and puts together a good seminar with a broad range of speakers. Thanks again to Justin and Rick for my opportunity to go!
Thanks Robert Johnson for your report.
Can you develop what Pat Fetterman solution to charge customer for new development is?
Marc –
I don't know exactly how much Plex is charging their customers, but it's not trivial. The basic idea is that if a customer wants a specific feature or function, Plex gives them a quote for it and then they decide if they want to pay for it or not. The interesting thing is that once the feature is done, it's available to all of their other customers as well (for no additional charge).
It's a great model if you can get your customers to buy into it, and Plex clearly has. I don't think it would work in a broader market, but it does appear to work in their tight vertical and I can see why.
Robert
So to clarify- I think it clearly depends on your vertical, but it's a clever way to add functionality for no cost or a profit, while not forking your codebase (key to SaaS).
By definition, not forking the code means the feature can be available to everyone if you so choose.
There are however some pitfalls with this approach- it could feel like you're in the custom software business and lose focus on product / market fit if you're not careful.
But if you're a small SaaS company, working in a tight vertical, design the new functionality carefully so to enhance your product/market fit, there is little downside to this approach, especially as the customer is tied in even more to your system…
Hi. This is Rick Chapman of Softletter, and I just thought I'd chime in here with a couple of observations.
First, I'd like to thank Robert for his kind comments about SaaS University; we work hard to put on a very content filled event. Also, I'd like to remind readers of this blog that our early bird pricing for our events is $795; also, at every event, we give away to all the attendees a free copy of one our research reports and we charge for these. At Chicago every attendee received a copy of our massive SaaS Marketing Report, which breaks out 22 separate marketing activities as carried out by SaaS firms. We charge $449 for it. At Dallas, we gave away our direct sales compensation guide, which has a $400 price tag. These items are not loss leaders and are sold on a regular basis. Our events are designed to be very content rich and we think we're offering excellent value for the money.
Also, we videotape the entire proceedings and make them available online to the attendees, so, for example while Robert wasn't able to see all of Ted's channel discussion at the event, he will be able to when the video is posted online.
Now, as the issue of customer service. We have had speakers at past events discuss, specifically, SaaS customer service issues. For example, at Chicago, we had Matthew Gonnering of Widen address this topic specifically and in Atlanta and Boston Tom Appleton of DreamFactory.
rick chapman
http://www.softletter.com
http://www.saasuniversity.com
However, at Dallas, we decided to focus on the topic of understanding that your SaaS customer base needs to be thought of as a community of users based on the inherent nature of the SaaS model. Patrick's presentation went way beyond the issue of having customers pay for new features and discussed the community of users concept in greater detail.
Once you understand the power of this concept (and implement it), you should also begin to think about how you provide customer support in different ways. For example, Patrick discussed how the Plex community has “taken over” the management of Plex's documentation and FAQs. Ultimately, your community becomes a highly self supporting, and self managing entity that a SaaS company truly “reports” to.