
The Rogue Wave of Enterprise SaaS - chesterarthur
https://staysaasy.com/scaling/2020/07/29/the-rogue-wave-of-enterprise-saas.html
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thinkingkong
Im a firm believer in the price elasticity of startup opportunity. We’ve more
or less solved the lowest common denominator problems in software and we’re in
the “chasing small optimizations” phase. In this phase I believe there are
many many more opportunities, but individually theyre smaller. In aggregate
theyre worth way more than a single company.

All this together - i think - will force LPs and VCs to change their return
models and invest/operate fewer businesses but still generate excellent
returns.

In other words a 20M arr business is amazing, if you arent trying to get to a
$B.

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mdorazio
I think you're probably right, but changing the VC business model means that
VCs need to get significantly more selective about which businesses they fund,
and also focus on metrics that a lot of younger entrepreneurs don't like (ex.
actual profitability). When you can't count on a unicorn exit to offset all
your total failures and zombies, investment models tend to start looking more
like bank loans via equity than like the traditional VC setup we're all
familiar with.

