ICTO14 - Karel van der Poel, Producteigenaar BI & Analytics ServiceNow

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ICTO14 - Karel van der Poel, Producteigenaar BI & Analytics ServiceNow

  1. 1. © 2014 ServiceNow All Rights Reserved 1Confidential Growth Hacking: Metrics & Business Models Serial Enterprise Software Entrepreneur, former VC Today: ServiceNow . Karel van der Poel
  2. 2. © 2014 ServiceNow All Rights Reserved 2Confidential Karel van der Poel born 1972… 1993 1996 1997 1999 2004 2007 2010 2014
  3. 3. © 2014 ServiceNow All Rights Reserved 3Confidential 2,200+ Enterprise Customers 2,100+ Employees Major Sites San Diego, Silicon Valley, Seattle, Amsterdam, London, Sydney ServiceNow – The Enterprise IT Cloud Company *Expected 2014 Revenues $13M $28M $64M $128M $244M FY12FY11FY10FY09FY08 $424M FY13 *$652M to $657M FY14 $139M Strong Revenue & Growth Platform Designed to Manage Service Relationships in the Enterprise Highly Secure and Available Enterprise Cloud SaaS Business Model Enterprise IT CloudNYSE: NOW $478M Trailing 12-Month Revenue
  4. 4. © 2014 ServiceNow All Rights Reserved 4Confidential ServiceNow - The Enterprise IT Cloud Company To IT For IT Thru IT
  5. 5. © 2014 ServiceNow All Rights Reserved 5Confidential The new world: Measure everything! • Tweets, likes, referrals • Ad Impressions, Clicks, Visitors • Landing pages, Conversion • Trials – leads – customers • Usage of trials • Usage Statistics of customers • Upsell – Cross sell • Recurring revenue, ACV, Margin • Renewals - NPS
  6. 6. © 2014 ServiceNow All Rights Reserved 6Confidential Fast Growth Saas companies: Measuring what matters Special thanks to David Skok of Matrix partners: http://www.forentrepreneurs.com • CAC = Customer Acquisition Cost • LTV = Life Time Customer Value • MRR = Monthly Recurring Revenue • ARR = Annual Recurring Revenue • ACV = Annual Contract Value • ARPU = Average Revenue per user/customer (AVG ACV/ARR/MRR) • Churn = the % of customers or dollars that are not renewed • Retention = the % of customers or dollars that are renewed. (100%-Churn) • % Renewal rate = % of customers that are up for renewal that actually renew • % ARR expansion = Expansion revenue from existing customers as % of total revenue • Conversion = the % of prospects / trials that are converted into PAYING customers
  7. 7. © 2014 ServiceNow All Rights Reserved 7Confidential SaaS success factors
  8. 8. © 2014 ServiceNow All Rights Reserved 8Confidential Deep dive on Profitability
  9. 9. © 2014 ServiceNow All Rights Reserved 9Confidential Two powerful metrics every CEO should know. LTV = Life Time customer value CAC = Customer Acquisition Costs The Goal
  10. 10. © 2014 ServiceNow All Rights Reserved 10Confidential SaaS is capital expensive
  11. 11. © 2014 ServiceNow All Rights Reserved 11Confidential Impact of growth and the impact of “time to recover CAC” on Cash Flow
  12. 12. © 2014 ServiceNow All Rights Reserved 12Confidential Impact of success • Finally cash flow positive? • Time to accelerate! • Negative cash flow again… • Pattern keep repeating when you are able to keep accelerating
  13. 13. © 2014 ServiceNow All Rights Reserved 13Confidential New Logo’s – Expand – Retain
  14. 14. © 2014 ServiceNow All Rights Reserved 14Confidential Your churn determines your revenue potential. One oft-overlooked aspect of churn is that the churn rate, combined with the rate of new ARR adds, not only defines how fast you can grow the business, it also defines the maximum size the business can reach Zero Growth: New ARR = Churned ARR
  15. 15. © 2014 ServiceNow All Rights Reserved 15Confidential • “97% of all our customers are retained each month!” – Does that include free customers? – What % of revenue is retained? – What percentage of customers was actually up for renewal? – 3% churn per month? You mean 31%! of your customer base churns in 12 months! – What does your cohort analysis look like? Why are customer churn and revenue churn so different?
  16. 16. © 2014 ServiceNow All Rights Reserved 16Confidential Churn Cohort Analysis
  17. 17. © 2014 ServiceNow All Rights Reserved 17Confidential Improving your churn over time.
  18. 18. © 2014 ServiceNow All Rights Reserved 18Confidential Where you want to be: Negative Churn!
  19. 19. © 2014 ServiceNow All Rights Reserved 19Confidential Impact of Churn and Negative Churn
  20. 20. © 2014 ServiceNow All Rights Reserved 20Confidential Your Funnel Metrics
  21. 21. © 2014 ServiceNow All Rights Reserved 21Confidential Mirror42 & KPI Library – low touch sales model. Online Advertising Customers Loyal Customers Invite 10000 Members a month Retain & Grow Convert
  22. 22. © 2014 ServiceNow All Rights Reserved 22Confidential The SaaS Company Dashboard
  23. 23. © 2014 ServiceNow All Rights Reserved 23Confidential Thank you Questions? Karel.vanderpoel@servicenow.com

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