February 23, 2024

I was celebrating a friend’s birthday with a large group a few days ago and realized that when the whole room is singing the same song, it can be hard to tell who’s off.

The same applies to B2B SaaS startups: since many companies typically look at the LTV:CAC ratio, it can be a good way to mask weak metrics.

Dividing customer lifetime value by customer acquisition cost provides useful insight, but how accurate is your historical retention data and how much have you collected?

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“Today, investors look to other efficiency metrics that paint a more reliable and comprehensive picture of a startup’s capital efficiency, and so should you,” says Igor Shaverskyi, a partner at venture capital firm Waveup.

In this TC+ column, he provides a formula and benchmark to calculate “How long will it take to pay off your customer acquisition costs.”

Now VCs are leaning more towards due diligence, reducing CAC returns and “paying special attention” to how the Rule of 40 works Proving that your team knows how to navigate. Investors like this.

“In my experience, some companies can reach a good position within two quarters, but on average, it takes about a year,” Shaverskyi wrote. “It all depends on the seriousness of your situation.”

thanks for reading,

walter thompson
TechCrunch+ Editorial Manager
@your leading role

How We Use Data-Driven Personas to Radically Improve Customer Experience

Set of people avatars. Different people avatar profile icons. profile picture. Men and women face different nationalities. Portrait of man and woman. collection of characters. Vector illustration.

Image credits: Hannah Pronsack (opens in new window) / Getty Images

I’m often amazed at how many startups do this no Develop customer personas.

Many teams don’t pull information from user interactions to create avatars that represent actual customers, but instead use their own judgment and guesswork about what people like and don’t like.

Gary Sabin, vice president of product at Impartner, said his company “dived into the numbers” and “looked at 250 data points” to develop “role-based service fulfillment, customer support and customer success.”

One year later, the company has higher customer satisfaction ratings and NPS scores. “These characters work for us,” Sabin said. “Your customer data can guide you in creating the most important personas in your customer base.”

Sometimes you need to sever your startup’s school ties

Image credits: Haje Kamps/TechCrunch

Considering how many startups emerge from colleges and universities, it makes sense that so many academics end up as senior executives. But is this necessarily a good thing?

Last week at TechCrunch Early Stage, hardware editor Brian Heater spoke with SOSV general partner Pae Wu about working with teams that include professors and students.

“In some fields, it can be very effective to keep your founding team members in academia,” Wu said.

“We see this all the time in the traditional biotech and pharma industries. But in other types of situations, frankly, it can be a drag on the company and cause problems for full-time founders.”

Ask Sophie: My STEM OPT will expire in 30 days, what are my options?

Lonely figure at the entrance of a maze hedge with an american flag in the center

Image credits: Bryce Durbin/TechCrunch

Dear Sophie,

My STEM OPT expires in one month, and my company did not register me for this year’s H-1B lottery.

I’m not sure what my options are now. help!

——Silicon Valley Sleepless

How Startups Can Generate Social Content That Really Resonates

Redpoint Partner Josh Machiz and Redpoint Head of Content Rashad Assir talk "How to Turn Your Startup Into a Social Star" TechCrunch Early Stage in Boston on April 20, 2023. Image credit: Haje Jan Kamps/TechCrunch

On April 20, 2023 at TechCrunch Early Stage in Boston, Redpoint Partner Josh Machiz and Redpoint Content Director Rashad Assir talk about “How to Turn Your Startup Into a Social Star.” Image credits: Haje Jan Kamps/TechCrunch

It’s harrowing to watch a company post something tedious on social media in an attempt to go viral or jump on a trend. It always gives me that creepy, “How are you, kids?” vibe.

Rebecca Szkutak caught up with Redpoint Ventures’ Rashad Assir (Head of Content) and Josh Machiz (Partner) last week for their thoughts on how young brands can demonstrate authenticity.

“What we’ve really learned here is that it’s better to get it out of the market, launch it — kind of like a startup — and really just see if it works, because if you have the inclination for it to succeed, then you can Invest more into it,” Machiz said.