Skane Startups Flightpath Investor Fireside Chat with Michael Rager Instructions
- June 1, 2024
- Skane Startups
Table of Contents
Skane Startups Flightpath Investor Fireside Chat with Michael Rager
Product Information
Specifications
- Product Name: DTCP Flightpath
- Authors: Lance Matthews, Michael Rager
- Main Features: Data-driven benchmarking platform, Analytical toolset
FAQ
- What is DTCP Flightpath?
- DTCP Flightpath is a proprietary analytical toolset that amalgamates financial data from listed and private SaaS companies to guide growing companies towards achieving great outcomes and exceptional execution.
- How does DTCP Flightpath help companies?
- DTCP Flightpath helps companies transition from early signs of product-market fit to more streamlined processes for future growth. It provides essential insights into the organization’s health, effectiveness, and trajectory.
About the Authors
Lance Matthews
Partner US team
- Lance is a partner at DTCP and with the fi rm since 2016. He is responsible for sourcing investment opportunities and making investment recommendations in the US.
- He is excited about supporting founders building transformative technologies in cybersecurity, cloud infrastructure, and AI and helping to assist them in growing globally. His DTCP investments include Arctic Wolf, Innovid (NYSE: CTV), and StreetLight Data (acquired by Jacobs).
- Prior to that, Lance worked for San Francisco-based Touchdown Ventures and Illuminate Ventures, a seed stage enterprise software focused fund.
Michael Rager
Partner European team
- Michael joined the fi rm in 2016 and is a key contributor to DTCP Growth’s European team.
- His skills span the entire value chain from deal sourcing, to scaling companies, facilitating expansion strategies on both sides of the Atlantic and realizing profi table exits.
- He is passionate about working with outstanding entrepreneurs and supporting them on their growth journey.
- Among others, he accompanied LeanIX to exit (acquired by SAP) and works closely with Pipedrive, Aircall, Cognigy and Quantum-Systems.
KPI Fingerprint
Amidst various valid approaches for evaluating the capabilities of enterprise SaaS companies on the trajectory towards Series B funding and beyond, DTCP has pioneered a distinctive, quantitative-first methodology free from human bias and positioned upstream of qualitative assessment.
In 2015, we launched DTCP Flightpath, our data-driven software that analyzes the financial data of any SaaS company and benchmarks it against competitors. This process yields a unique KPI fingerprint for each firm, shared with the entrepreneur, empowering us to extrapolate and forecast the company’s future.
DTCP Flightpath
Keep the Magic, make the Next Step
All SaaS founders who found product-market fit and reached their first million dollars of sales will agree that they reached a massive milestone. But the journey has just started with the expansion stage of company growth, and the early wins need to be converted into a repeatable sales and product execution machine.
During this phase, there’s a transition from early signs of product-market fit and leadership-driven go-to-market (GTM) strategies to more streamlined processes laying the groundwork for future growth. Timing is critical; implementing these processes too early risks undermining the startup’s “magic” and swift execution, while delaying them jeopardizes long-term growth.
Outcomes can result in “good” performance if done well. DTCP Flightpath, our proprietary analytical toolset, amalgamates financial data from both listed and private SaaS companies. Its purpose is to guide growing companies methodically toward achieving “great” outcomes and exceptional execution. The signals derived provide essential insights into the organization’s health, effectiveness, and trajectory.
Systematic T2D3 Enablers
- Well-executed enterprise SaaS companies often follow a ‘triple, triple, double, double, double’ (T2D3) ARR growth trajectory to hit the $100 million ARR milestone. Many successful SaaS companies that have gone public reached $100 million ARR within 10 years, and with less than $100 million cash consumed.
- In 2015, we introduced DTCP Flightpath, a dual-purpose solution at its core. This tool serves as a guiding compass for CEOs and CFOs of our portfolio companies, offering insights into the vitality and future paths of their businesses. Simultaneously, it stands as an objective and measurable guide, facilitating informed internal investment decisions.
- Navigating through abundant signal intelligence data for expansion-stage companies and achieving consistency across SaaS verticals is a given. However, the challenge lies in discerning the relevance of this data and effectively connecting signal intelligence to actionable levers.
360° Insight Precision: Navigating Company Dynamics
The DTCP Flightpath dataset holds significant value, ensuring the extraction of statistically relevant insights through continuous updates. This proprietary data processing engine leverages thousands of datapoints from private and publicly traded companies, maintaining a reliable track record spanning nearly a decade. Condensing information into five key performance indicators (KPIs) — Growth Pattern, Net Retention, S&M Efficiency, Capital Efficiency, and Quota Achievement — offers a comprehensive overview of the firm’s absolute and relative position.
DTCP consistently employs analytics to deliver a detailed perspective on a company’s operations at a granular level. The result is a variety of metrics that shed light on both the absolute performance and its position relative to competitors, acting as a benchmark. To compute the benchmark, DTCP groups data of similar companies and computes the average for each data point.
Highly efficient vetting of investments, back-tested against DCTP’s models and the company’s assumptions
Unbiased Business Benchmarking
SaaS business models exhibit a vertical-agnostic dynamic, facilitating optimal
comparison scenarios. The analysis outcomes not only provide information on
financial and sales metrics but moreover also pinpoint collaborative
opportunities with executive teams for improved market positioning and
increased market share.
DTCP’s analyses encompass a broad spectrum of information concerning company
performance, coupled with a detailed focus on GTM strategies and operational
execution.
For SaaS companies and investors, understanding the effectiveness of sales conversion to topline growth is paramount. At DTCP, we measure this through three lenses including ARR Growth ― also known as Net New ARR Growth (NNARR) ―, Revenue Growth, and importantly, Gross New ARR Growth (GNARR). These metrics are the “exhaust” of the sales engine, and are historical indicators of performance, acting as a waypoint for deeper sales conversion and customer analyses. Understanding what is driving ARR growth (or lack thereof), can point the entrepreneur towards an examination of customer demand, GTM pipeline, success in conversion, and customer retention.
For DTCP, the exemplary measure for benchmarking efficiency is the KPI Capital Efficiency. This measures the effectiveness of the company and its engine. How proficient is the company at converting gasoline (capital) into thrust (topline growth)? Understanding this diagnostic again points the company to additional areas of analysis. These areas include drivers or subtractor of Net New ARR and operational expenses.
These anonymized cohort analyses provide an understanding of a company’s performance throughout the maturation curve from expansion, through early growth, and all the way to IPO. And ultimately, the goal is to have a holistic view of the company’s execution and quantify its performance to drive an investment decision.
DTCP Flightpath Score Unveils Comparative Value
- The exclusive software eradicates bias by impartially scoring a firm’s comprehensive performance, encompassing financial metrics, management effectiveness, and competitive positioning on a scale from 0 to 100.
- The aggregated score gives insight into the performance of the company and allows for slicing and dicing into a variety of single segments, shedding light into areas such as Growth, Sales efficiency and Customer Acquisition Cost (CAC) Payback.
- Furthermore, the data can undergo assessment within specific timeframes, enabling an impact analysis of market events on the company compared to the industry at large. This yields additional insights into the company’s competitive advantage and its capacity to spearhead the industry.
Key Findings of the Benchmarking Process
The Single Tool to Determine Real Industry Position
DTCP Flightpath offers founders and CFOs an impartial, objective assessment, free from emotional biases. It reveals the authentic position within the SaaS industry and provides actionable insights for areas of further enhancement and increasing customer penetration, ensuring higher success rates.
Best of Both Worlds – Concrete Metrics and DTCP Skills
Simultaneously, the DTCP Flightpath results equips DTCP’s Growth team, the expert investor in Enterprise SaaS, to evaluate the company’s strengths and identify areas for improvement. Leveraging our proven track record in company development, market access in Europe and the US, and specialized expertise in GTM strategies, we serve as the strategic partner for founders seeking to secure and expand market share in their upcoming financing round.
Lance Matthews
- Partner, DTCP Growth
- lance.matthews@us.dtcp.capital
Michael Rager
- Partner, DTCP Growth
- michael.rager@dtcp.capital
Important Notice: This document serves informational purposes only. It constitutes neither an investment advice, an investment service nor the invitation to make offers or any declaration of intent; the contents of this document also do not constitute a recommendation for any other actions. The validity of the provided information is limited to the date of preparation of this document and may change at any time for various reasons, especially the market development. The sources of information are considered reliable and accurate; However we do not guarantee the validity and the actuality of the provided information and disclaim all liability for any damages that may arise from the use of the information. Historical information cannot be understood as a guarantee for future earnings. Predictions concerning future developments only represent forecasts. Statements to future economic growth depend on historical data and objective methods of calculation and must be interpreted as forecasts. No assurances or warranties are given that any indicative performance or return will be achieved in the future.
The term DTCP comprises companies of Digital Transformation Capital Partners Luxembourg Sarl, its affiliates and sub-advisors. The respective responsible legal entities that offer products or services to (potential) investors are named in the corresponding agreements, sales documents or other product information.
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