Home » Entreprenuer’s School of Hard Knocks

One Reason SaaS Businesses Fail

By: Ned Stringham

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The Software-as-a-Service (SaaS) business model, when working right, is a financial analyst’s dream.
Revenue is recurring, customer attrition is low, gross margins usually exceed 70% and the business can scale quickly without adding people. The result is amazing cash generation and valuations exceeding 5, 7 and even 10x revenue. It’s clear why every venture capitalist, private equity firm, angel investor and management team in the software space is in love with software-as-a-service. More

Shoot for the Horizon Not the Stars

By: Ned Stringham

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It is true that to be an entrepreneur you must have a vision for your business and be unconstrained in your thinking about what’s possible; however, one of the most overlooked ingredients for success is never forgetting what it takes to survive. Sometimes just surviving long enough for your market to come alive or to figure out the right twist in your product or message is the difference between winning big and going under. The true story for many successful businesses involves tales of near death experiences, re-direction, and the will to survive. Too often media focuses on the hype, entrepreneurs dream about being the next Facebook and it all ends badly–either the business collapses or the founders get massively diluted in order to raise the cash to survive. More

Is “Serial Entreprenuer” Just Code for Serial Failure?

By: Ned Stringham

Have you noticed that just about everyone you speak with these days is a ‘serial entrepreneur?’ It’s the vogue thing to be. Like consultants in the late 80’s and venture capitalists in the late 90’s, everyone is trying to spin their story, but as before, the substance is often lacking. More

Telling the Story Backwards

By: Ned Stringham

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When you read a story about a successful entrepreneur in the media, it’s important to remember that in almost every case it is being told after the fact, after the events and after the ‘success.’ By looking backward, the writer always knows how the story ends. They have the luxury of shaping the events to show the path to success. The hard edges are rounded off and miss-steps seem less important. Too often the actions the leaders could have taken that may have delivered greater success and examples of other companies that followed a similar path and failed go unreported. More

Turning an Offer on It’s Head

By: Ned Stringham

A very clever deal guy taught me a simple mental trick when evaluating an offer to sell part or all of your company. He told me, “if you say no to this offer to sell, it’s the same as you buying the business for that price.” The price you turn down is the price you effectively ‘paid.’ It is now your new baseline. You now have to create value above and beyond that baseline. Can you still grow the value of your business at a rate and to a size above that level which justifies saying no to the offer? More