Category - Technology

Technology

1
Give me Integration or Give me Death
2
How Mountain Climbing and Negative Churn Are Related
3
The Differences Among Junior & Senior Developers & Architects

Give me Integration or Give me Death

If you are a SaaS business, heed this warning: Integrate. Or die.

At OCA, we continuously evaluate our investment themes. We look for long-term, sustainable macro trends. If we are right about these themes, it gives us two advantages: (1) our companies will have more margin of error in execution. In niche markets, a company has to execute flawlessly but in large and growing markets fueled by macro trends, you can screw up a couple of things and still achieve a good exit for all shareholders. And (2) once educated in a theme, there are great economies of scale in due diligence, exits, recruiting, deal sourcing and other areas.

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How Mountain Climbing and Negative Churn Are Related

I am a huge fan of For Entrepreneurs’ seminal work on SaaS metrics. I’ve read it several times over the years, I require our interns to read it and it’s a suggested resource in my class. If you are an entrepreneur running a SaaS business or even considering it, do yourself a favor and stop reading this post and read that post immediately.
One “state” that is mentioned in the post is “negative net churn”, which is when additional monthly recurring revenue (MRR) from existing customers (“expansion MRR”) exceeds MRR that is canceled from customers that are leaving (“churned MRR”) and customers that are downgrading (“downgrade MRR”). There is no doubt that negative net churn is a good thing, after all, the name connotes a negative bad thing (churn) so it must be good, right?  But I’ve heard several entrepreneurs mention negative net churn as the nirvana. That if the company achieves this milestone it will be in great shape and churn will be in check.

The Differences Among Junior & Senior Developers & Architects

Last week I had a conversation with a founder about hiring development talent. It’s no secret that there is a shortage of software development talent in Chicago and throughout the country. A natural response to the constrained supply of developers is to widen your net, increase compensation and/or lower your standards. None of those are fun but it is a reality in today’s world. 
 
We talked about the pros/cons of hiring junior development talent versus senior development talent. The question posed was is it better to hire two junior developers or one senior developer? It occured to me during the talk that the essence of the difference between junior and senior developers is this: an ability to understand tradeoffs. 

Copyright © 2014 Jason Heltzer