I have raised venture funds. Am I Value SaaS?
Yes. You can be. Funding vs. Value SaaS is a false dichotomy. It's not 'if' but 'when' you raise funds that determines whether you are a Value SaaS startup. Usually, founders hit on a business idea and look for funding immediately. That's not Value SaaS. Value SaaS insists you become capital-efficient before making a run for growth. Shape your revenue flywheel and fix your unit economics first. Build a capital-efficient business, prove your product's value to your customers, and then scale using external capital. If this has been your journey, you are Value SaaS.
Is Value SaaS bootstrapping?
Value SaaS and Bootstrapping are not interchangeable, although bootstrapping is where the Value SaaS journey begins. When you bootstrap, you are building the business minus external equity. Your primary focus is to be capital-efficient and earn 'more than' every dollar you spend. This is the essence of Value SaaS. Once you hit repeatable revenue and move into the growth phase, you may choose to stay bootstrapped, raise funds or opt for a strategic exit. In other words, being Value SaaS puts you in control over your growth journey and gives you Optionality.
What is burn multiple? What is a good burn multiple?
‘Burn multiple’ refers to the dollars you spend to generate one dollar of revenue. It is a measure of the capital efficiency of a startup. The higher your 'burn multiple,' the more cash you have spent to reach each unit of growth. Minimizing your ‘burn multiple’ helps to maximize your runway and grow capital efficiently. Further, keeping your ‘burn multiple’ low increases your chances of raising funds. A Burn Multiple of less than 1 is considered excellent and over 3X is bad.The Burn Multiple is also contextual, based on the stage of your business.
What are some recent examples of Value SaaS companies?
Some of the biggest Value SaaS winners are Salesforce, Atlassian, Veeva, Amplitude, Confluent, Expensify, GitLab, Olo, SEMrush, and Upekkha startups like Signeasy, iMocha, Almabase, Appknox. There are many more in the making at Upekkha.
How can I build Value SaaS?
At Upekkha, we coach founders like you to build Value SaaS or capital-efficient businesses. Founders learn to generate more than a dollar for each dollar they spend. We do this through the SaaS Flywheel framework that pushes founders to make exhaustive customer discovery to fix their business fundamentals, like market choice, gameplay choice, ICP (Ideal Customer Persona ) choice, problem choice, pricing, and positioning. From this derives their sales and marketing strategies. Once the founders get their revenue flywheel spinning, grow, and earn repeatable revenue while keeping their burn multiple low, they have made it to the Value SaaS club.
What is Ramen Profitability?
Ramen profitability means neither loss nor huge profit. You make a meager profit that allows you to be on the cheapest diet, like Ramen noodles. No burrp. While this may not be glamorous, Ramen profitability ensures that you make enough to finance your slow yet steady growth. You can continue to build your business on your terms without the distraction of fundraising. Ramen profitability ensures that you retain your most valuable assets, focus and equity, that comes at a premium in the early stage. The Value SaaS Movement is on the mission to create winning outcomes for founders, their teams, and investors.