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Welcome to The Cirrostratus Group April newsletter.
I hope you and your families continue to be safe and healthy as the COVID-19 shutdown continues. As I said last month, for those of you dealing with the challenges of loss of business, sick employees or family members I'm sorry you're having to deal with this.
In the conversations that I've had and the reading I've done, it appears that although horizontally focused SaaS businesses have challenges these types of businesses are doing ok because they don't rely on specific industries. For vertically focused SaaS businesses it depends entirely on the vertical. Verticals that support travel, restaurants, non-home based entertainment and non-essential retail generally have significant challenges. SaaS businesses supporting essential retail, logistics, supply chain and grocery businesses are doing well. Is this consistent with what you're experiencing?
There are SaaS pricing and packaging strategies that may be good options for you during the current challenges. A good set of possibilities are in this
article from Openview Partners. A good example is Fender which I talk about below. I believe that there are also opportunities to make product changes to deal with the new short-term and long-term challenges. Whether the changes facilitate new realities in payments, social distancing, communication, scheduling, logistics or other areas, there very likely are opportunities to help your customers with new creative features.
Last month I talked about the advantages that SaaS businesses tend to have because of previous experience with home based and distributed work teams. Another advantage is that SaaS businesses did better than many businesses during the previous recession because of the general growth of the SaaS software model and the reduced volatility of revenue due to the subscription model. SaaS Capital previously did a
review of SaaS businesses during the previous recession and I think there is value in understanding what happened to SaaS businesses during that recession and what lessons we can learn.
Stay safe and healthy.
Paul Ressler
The Cirrostratus Group
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