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Do You Have a “Pricing Gap” Holding Back Sales? Many Do

By Jason Lemkin
Wednesday, April 23, 2025 | SaaS Product Pricing

Do You Have a “Pricing Gap” Holding Back Sales? Many Do

So recently we had a SaaS buying experience that led to a No that is very common but many don’t realize is there, or at least is there that much:

A SaaS Pricing Gap

We went to buy Riverside, a podcasting tool, after years of being on Zoom. We wanted to move to Riverside, it’s the gold standard, but we needed to gain confidence it would work for us 100%. Plus, we already paid for Zoom. So there was no incremental cost for using it for our podcast.

We started off on the Paid single seat version at $15, and quickly upgraded to Pro at $24. So far, so good.

Then we wanted to have 2 accounts, and that’s where it went off the rails. At least for us.

2 seats is $500/month.

PRICING GAPS

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Carta: The Average Time from Seed to Series A Has Hit 2.2 Years. And Longer from Series A to Series B.

By Jason Lemkin
Tuesday, April 22, 2025 | Q&A

Carta: The Average Time from Seed to Series A Has Hit 2.2 Years. And Longer from Series A to Series B.

So averages (and medians) when it comes to start-ups can be a bit misleading. After all start-ups are a business of trying to build an outlier.

Still, the latest data from Carta is very helpful in illustrating an overall trend the gaps between venture rounds are getting longer and longer.

Per Carta, the median time between rounds as of the end of 2024:

From Seed to Series A 2.2 years
From Series A to Series B 2.5 years
From Series B to Series C 2.4 years

There’s no question many hot AI start-ups are raising rounds far, far faster than this.

But it is a reminder that for most of us, if nothing else, fundraising continues to get harder each subsequent round.

MORE HERE

Dear SaaStr: What Are Some Things We Can Do To Get Churned Customers Back?

By Jason Lemkin
Wednesday, April 23, 2025 | Q&A

Dear SaaStr: What Are Some Things We Can Do To Get Churned Customers Back?

Reactivations are when previously churned customers come back and start paying again. Reactivations are way too often overlooked, but they can be a meaningful lever for growth if you approach them strategically. Our B2C friends often obsess over there, but in B2B, we rarely approach getting customers back as broadly and strategically as we could.

RevenueCat manages 40% of all mobile apps subscriptions, across 10,000+ paid apps. What does it see? 12% of lapsed paying customers … come back later. Most are more B2B2C that B2B, but the point still holds.

GETTING CHURNED CUSTOMERS BACK

Dear SaaStr: Besides Fast Growth, What Are VCs Looking For in Founders?

By Jason Lemkin
Tuesday, April 22, 2025 | Q&A

In the end, most VCs are looking for huge market pull, and ultimately, massive growth first and foremost.

But founders are > 50% of the bet, too.

Investors evaluate startup founders based on a mix of personal traits, leadership potential, and their ability to execute. Here’s what they’re really looking for:

Resilience and Grit:
Founders need to demonstrate they can weather the inevitable ups and downs of building a startup. Investors want to see that you won’t quit when things get tough—because they will get tough. This is especially critical in SaaS, where the journey to $100M+ ARR can take a decade or more.
Vision and Clarity:
Can the founder articulate a compelling vision for the company? Investors want to know if you can inspire not just them, but also employees, customers, and future investors. A clear, bold vision is often what separates great founders from good ones.
Domain Expertise:
Founders who deeply understand their market and customers have a huge edge. Investors will ask: Do you know your stuff better than anyone else? Have you lived the problem you’re solving? For example, when I invested in Algolia, I knew the founders were obsessed with search and had the technical chops to back it up.
Execution Ability:
Ideas are cheap—execution is everything. Investors look for evidence that you can get things done. Early traction, even small, is a strong signal. If you’ve already landed a few paying customers or built an MVP that’s gaining traction, that’s gold.
Team-Building Skills:
Can you recruit and retain top talent? A founder who can attract A+ players is far more likely to succeed. Investors know that startups are built by teams, not individuals, so your ability to build a strong team is critical.
Coachability:
No one expects you to have all the answers, but they do expect you to listen and learn. If you come across as arrogant or unwilling to take feedback, that’s a huge red flag. Investors want to work with founders who are open to advice but still confident in their decisions.
Commitment to the Journey:
Are you in this for the long haul? Building a SaaS company to $100M ARR takes 7-10 years, minimum. Investors want to know you’re not going to bail when things get hard or when a quick acquisition offer comes along.
Salesmanship:
As a founder, you’re always selling—whether it’s to customers, employees, or investors. If you can’t sell your vision in the pitch meeting, it’s unlikely you’ll be able to sell it in the market. Investors are looking for founders who can close deals and inspire confidence ‌7‌‌9‌.
Focus and Prioritization:
Startups fail when founders try to do too much at once. Investors want to see that you can focus on the most important things and execute relentlessly. If you’re pitching a laundry list of features or markets, that’s a red flag.
Authenticity:
Investors can spot a fake a mile away. Be real about your challenges, your vision, and your goals. If you’re overly polished or evasive, it’s hard to build trust—and trust is everything in early-stage investing.

Ultimately, investors are betting on you as much as they’re betting on the idea. They’re asking themselves: Do I believe this founder can take this company all the way to $100M ARR and beyond? If the answer is yes, you’re in a great position.

WHAT ARE VC'S LOOKING FOR?

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The New AI Paradigm: Great Outbound, Terrible Follow Up

By Jason Lemkin
Tuesday, April 22, 2025 | Q&A

The Strong Outbound, Crappy Follow Up. It’s now new, but it’s accelerating with AI.

It’s going to be a more and more common playbook in the Age of AI.

Take last week. I got an incredible well timed, well written email from an agency about helping on production side of our podcast. And we do need help. I told them to do a test project, and if it went well, we’d just use them.

Then the shoe dropped.

“How many podcasts do you do?” they asked.

I mean, take 5 seconds and look. Go to Spotify, Apple of YouTube. You will see the answer. Literally in seconds.

Deal lost.

AI is probably going to accelerate this trend of Strong Outbound, Terrible Follow Up.

Done right, AI will make our outbound better researched, more relevant, better targeted, higher value, and even more timely. Much of the AI generation outbound today is just more spam, with fewer typos. But some of it is already getting better. Especially when it’s a combo of human + AI, thoughtfully done. T That’s in fact why the outbound I was sent above was so strong.

But if over-reliance on AI leads to terrible follow-up, performance in the end might be worse.

We’ll see. In an age where so many of us are looking to do less ourselves, and automate more, the follow-up after the outbound may get even worse.

And if it gets worse … we may take it away from sales reps entirely. We’ll see.

THE NEW AI PARADIGM

5 Interesting Learnings from UiPath at $1.7 Billion in ARR

By Jason Lemkin
Wednesday, April 23, 2025 | 5 Interesting Things, Scale

5 Interesting Learnings from UiPath at $1.7 Billion in ARR

So before we had AI, we had automation.

Of course, we still have plenty of automation. So much of business software in the end is about automation. But AI has begun to change everything here. And before AI, RPA was revolutionary. Robotic Process Automation. Call it fancy scripts if you want, but UiPath is the clear leader here and after struggling for 10 years to get to the first $1m in ARR, then exploding to $1B (!) in ARR in less than 8 years after. Wow.

If you needed to automate data entry, data extraction, and so much more from older software especially, UiPath was the answer. And it was and is magical.

5 INTERESTING LEARNINGS

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Do You Have a Pricing Gap Holding Back Sales?