Last week I spoke with some entrepreneurs at MaRS in Toronto on one of my favourite topics: SaaS Math – covering metrics, pricing and valuations. My slides from that talk are below. Or if you have 90 minutes on your hands, the full video is here.

Category:
Management, Metrics, Resources, SaaS
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  • http://twitter.com/josephfung @josephfung

    Great summary from a number of different data points. You highlighted Freemium models, but I would have expected to see a stronger comparison between Freemium and Freetrial – the marketing models are very different (I identify well with how Dan Martell differentiates between them).

    With TribeHR, for example, we moved away from a freemium approach as it wasn't the right fit for our model – the concern was less about the points that you highlighted on slide 29, though, and it was more about the differentiation between versions. I suppose that debate is beyond the domain of startup math, though.__I truly believe that for freemium to work, the free version needs to be able to provide high value to the vast majority of the market, but still have a clear *functional* different between the free and premium versions. For products where the functional differences scale well between versions (e.g. GetSatisfaction) I'd argue that freemium may not be ideal.

    • http://startupcfo.ca Mark MacLeod

      Hey Joseph,

      I was covering freemium more from a pricing strategy point of view than a true, thorough goto market comparison. The free version does need to be fully functional and adequate for most users. Free trial works well as an alternative if you can reach out to your prospects during the trial phase to help onboard and convert them

  • Ian

    Hi Mark – I really enjoyed your presentation and have recommended the video to colleagues who didn't make it.

    I have a related question for you – how are the SaaS companies you work with handling sales tax? Have you come across any good resources on the topic?

    Thanks

  • Martin Bittner

    Thanks for sharing this!