Last week I attended SaaStr Europa in London (4-5 June) with some of the Blue Hat team.

It’s a calendar highlight for SaaS founders, their teams, investors and entrepreneurs and brings together insightful speakers, panel discussions and opportunities to network with professionals in the SaaS industry. Topics cover all aspects of building, scaling, and operating successful SaaS businesses. I came away informed and inspired and keen to share my five takeaways from SaaStr with my team, clients, partners and you!

Two days packed full of insights, inspiration and practical advice

While I didn’t make it to all 75 sessions (!) it was a busy two days of talks, panels and roundtables. As always, it’s a great learning and networking experience and I particularly enjoyed Jason Lemkin’s sessions top and tailing the conference.

Here are my five takeaways from SaaStr this year (in no particular order):

#1 Product-led growth doesn't scale in the enterprise market

My first session was the Canva keynote on “Overcoming the PLG Trap”. Daniela Nyarko and Jorge Bestard from Canva talked about how they had to switch gears to grow enterprise clients.

While Canva initially successfully scaled through product-led growth (PLG), this approach didn’t work well in the enterprise market. It’s a different beast – which needs a sales (and pre-sales) team along with a separate product team. Why?

Apart from different needs and use cases, enterprise businesses buy and use products differently from individuals and SMEs. The competitive set is different too. So, selling the same product via a different GTM model just didn’t work.

Canva’s approach? They put on the brakes. Focused on the product (not just the GTM) and set up a separate product team. They took two years to design and build a separate product for enterprise teams that focused on supporting collaboration and organisational hierarchies.

BHA POV: This approach resonates as we often use a POD model and discreet teams to help clients accelerate product development or work on specific features.

#2 When the market's down, keep building.

Saastr founder Jason Lemkin noted that the B2B2B market has been a bit grim lately (quoting Mongo and Salesforce both down and missing growth targets). Off the back of rapid growth in 2021-2022, we’ve seen the market slow, and in some cases, grind to a halt.

Big corporates have been tightening their belts (as we note in a new blog series on optimising operational efficiencies for SaaS development businesses) and, in turn, reducing existing licences and stalling new client growth.

Jason’s advice? Keep building. When things are tough, just keep shipping product. The market will come back in 2025 (just like B2B2C came back). Use the time to focus on customer needs and make inroads into your product backlog.

BHA POV: We agree with Jason here. We’ve written about the challenge of managing costs effectively during tough trading conditions and continue working with clients who want to innovate. Recently, there’s been a focus on AI and integrating LLMs into core product offerings (something Jason noted as essential for B2B2B SaaS businesses that don’t want to be left behind).

#3 AI is not a nice-to-have. It's time to get in the game (if you haven't already).

Continuing with AI for a moment (as it was a common theme throughout the two days), Jason noted AI is becoming a driving factor in B2B2B SaaS growth.

Whether you’re on board with this or still cynical (that AI will make your app any better), it’s time to get building. Check your competitors – if they have built AI into their products, they’ll win the deal.

With Gartner’s forecasting 20% YOY growth spurred on by GenAI-enabled apps (in a tough market) then it’s time to look at how (not when) to integrate AI. Calling yourself AI isn’t enough.

BHA POV: This is a growing area of business for us where we are being brought in to specifically to build LLMs into core product functionality.

#4 VCs want to invest but there's stress in the system.

VCs want to invest. But they’re looking for unicorn-style growth; with interest rates so high, they need to see swift growth and massive returns.

How achievable is the “4433” (4x Year One, 4x Year Two, 3x Year Three, 3x Year Four giving an income level to justify a unicorn $1BN valuation) trajectory in this market? The feeling from the floor was that SaaS isn’t achieving those ratios right now. Perhaps that’s down to the conference location (London) and participants (smaller UK-based businesses)? But these are still credible, growing businesses making very good money.

So, what options do they have?

One option is to remain private. And to continue growing. Not necessarily at unicorn ratios but still significant growth with and option IPO in the future with much more model levels of investment and spend

BHA POV: Unicorns have historically been rather rare. There are many exciting SaaS businesses out there that are already scaling. We work with these types of firms to accelerate growth through innovation, modernising their platforms, improving operational efficiency through automation, improving product positioning and providing access to talent and technology leadership.

#5 Avoid hiring fractional resources.

Jason expressed a polarising view of finding the right people to lead growth. His advice was to not hire fractional people and to focus on dedicated, full-time hires.

If you're on a unicorn-trajectory, it makes sense to hire dedicated teams when you’re freshly-funded and cash-rich. You can afford to and need them to build at a pace to match your growth.

BHA POV: We disagree with this one unless you are sure of a unicorn status. If your growth curve is slightly shallower or more unpredictable, you will need to be vigilant not to burn through your cash! We’ve written a blog on this very topic! Hiring fractional people and teams can provide you with the talent you need, when you need it, without putting cash flow at risk. Staying flexible while sourcing the right talent is important. Of course, you’ll hire into your core team, but keeping certain roles at certain times flexible means you can more easily shift gears when you need to.

That’s a wrap on my five takeaways from SaaStr 2024.

It’s safe to say I’ll be attending next year for more insights and networking. In the meantime, Blue Hat will keep helping scaling SaaS businesses scale. Please email us to speak to one of our Partners if you want to discuss any of the points above or some of the challenges you’re facing in this tough market.