Bessemer Ventures Partners are a US based VC fund.
They solely invest in cloud SAAS businesses. I have been following them for a while as they definitely have an interesting portfolio.
There has been a big correction in the markets regarding SAAS.
Here is their recent “State of the Cloud” report (published May 2022).
Bessemer are definitely promoting their own Kool aid and weaving a clever story around the previously over hyped SAAS valuations, but it's an interesting report.
The main takeaways are:
- SAAS remains a great business model with high margins
- SAAS and the broader cloud infrastructure revolution is just starting up
- Unicorns don’t necessarily make a good business (they just indicate the health / whims of the funding markets)
- The new kid on the block is the Centaur: A class of SAAS with $100 MIL + in ARR. The success and longevity of these businesses are pretty solid and gives a much better indicator than Unicorns (which are often puffed up by hype, not reality)
Essentially, the report is a cry to return the fundamentals of business.
If you are not making money, the valuation and multiples should reflect this. Wow! Making money is important? Who would have thunk it?
The proliferation of SAAS based business means a few things if you are a Marketer :
- For a CEO, to be found in the sea of SAAS, you need to learn how to raise money
- The multiples are correcting from last year’s crazy valuations
- For Marketers, the average cost of Customer Acquisition (CAC) is set to rise BIG TIME
- There are big opportunities outside of Google / LinkedIn and Facebook to reach potential users at scale and for less money
- Attribution, sourcing and servicing Partners at scale can save your SAAS!
If you are a Growth Manager for a B2B, check out my article here on how you can improve growth through Partnerships