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Tomasz Tunguz + Jason Lemkin on the State of SaaS
11 segments available
Tomasz Tunguz, Partner at Redpoint Ventures and Jason Lemkin, Founder of SaaStr chat about the state of SaaS. IPOs, ICOs, M&A, and more!
Segments Timeline
Welcome to SaaStr
Tomasz Tunguz and Jason Lemkin kick off the SaaStr event, expressing gratitude for the audience's energy and excitement. They discuss the significance of the event and tease upcoming sessions, highlighting the impressive journey of a featured speaker who overcame challenges to achieve success.
"please welcome Thomas Tunas venture capitalist at redo and Jason limkin founder of [Music] saster anyone here read tomas's blog post has anyone ever read his stuff raise your hand if you've ever read ..."
The Rise of ICOs
Tomasz Tunguz shares insights on the impact of Initial Coin Offerings (ICOs) on startup fundraising. He discusses a recent experience with founders who raised significant capital through ICOs before even writing code, emphasizing the shift in fundraising dynamics and the potential for startups to leverage this model.
"for the incredible energy over three days um I wanted to to just a few a few couple announcements and then I and then Tomas and I will talk about just some high level stuff things I'm interested about..."
Understanding ICO Trends
Tunguz delves into the statistics surrounding ICOs, noting that they raised over $4 billion in 2017. He highlights the median amounts raised and discusses how a significant portion of ICOs involve companies that have previously secured institutional funding, indicating a trend in startup financing.
"players the play are the same um and then last uh if uh if you uh We've uh we we've half launch this saster Pro product which is a a learning system that trains your team on saster content um but if y..."
Blockchain's Broader Impact
The conversation shifts to the broader implications of blockchain technology beyond consumer applications. Tunguz explains how blockchain is influencing various sectors, including enterprise applications, and discusses the potential for decentralized solutions to disrupt traditional business models.
"million before you write a line of code what what's going on what what what can we learn and can all of us Ico in this room should you and I do an a saster uh uh tungus Ico or what are you doing this ..."
The Advantages of ICOs
Tunguz outlines the strategic advantages of ICOs for startups, particularly in creating network effects and competing against established players. He emphasizes how ICOs can incentivize participation and foster growth in decentralized ecosystems.
"meeting where we uh share the story of what's going on in our ecosystem with our investors two days ago and one of the charts that we showed them was a lot of people think about icos in crypto as just..."
Private Equity's Role in SaaS
The discussion transitions to private equity (PE) and its growing interest in SaaS companies. Tunguz explains the differences between venture capital and private equity, highlighting how PE firms are increasingly targeting SaaS businesses for acquisition and investment.
"great way of doing it because what you're doing is you're incentivizing the people who are partic participating in the network in some way and so in the consumer landscape you look like a Facebook or ..."
M&A Landscape for Founders
Tunguz and Lemkin discuss the current state of mergers and acquisitions (M&A) in the SaaS space. They explore the changing dynamics of M&A, including the challenges faced by founders and the increasing interest from private equity firms in acquiring SaaS companies.
"no delution all right one quick one that talking to Founders here I mean boy private equities a change in SAS right of course uh you know I met um I'm going to use one of your this this the only one I..."
The Future of IPOs
The conversation shifts to the IPO landscape for SaaS companies. Tunguz discusses the evolving perceptions of IPOs, the criteria for going public, and the potential for SaaS companies to achieve significant valuations in the current market.
"and they tend to make uh majority investment so they take to 10 they they take control of the company and a lot of these private Equity firms so you look like a Vista uh what they do is they actually ..."
Decacorns on the Horizon
Tunguz and Lemkin reflect on the emergence of decacorns in the SaaS industry, discussing how companies are achieving valuations of over $10 billion. They analyze the factors driving this trend and the potential for continued growth in the SaaS market.
"between x million in ARR 5 to 50 how many think deals can be done loads maybe I don't know Hazard guess 100 or 200 next year I mean a lot but that's a lot of options there's not going to be you know G..."
Market Dynamics and Software Adoption
The discussion concludes with insights on the overall market dynamics for SaaS. Tunguz emphasizes the low penetration of software in various sectors and the opportunities that lie ahead as more businesses adopt SaaS solutions.
"related to that so P I believe is a gift for Founders it's more you don't have to take it yeah you don't have to sell but it's another way to potentially drisk your journey right is m&a gotten any bet..."
Closing Thoughts
Tunguz and Lemkin wrap up their conversation, summarizing key takeaways from their discussion on the state of SaaS, ICOs, private equity, and the future of the industry. They express optimism about the growth potential for SaaS companies in the coming years.
"that will happen big deals happen like that because all of a sudden the cost of capital is really cheap I think you're starting to see some decline in the court growth rates of some of the larger comp..."