Early stage startups often claim that their go-to-market strategy is fully operational. In reality, GTM is a pure numbers game, and even with a solid plan, it can easily be thwarted by common problems like turf wars and poor communication.
Finding GTM Fit is a milestone for any startup. from expanding the engineering team to starting your first media purchase. But how do you know when you reached that magical moment?
âYou have to consider three metrics: Gross Churn Rate, The Magic Number, and Gross Margin ,” says Tae Hea Nahm, Co-Founder and Managing Director of Storm Ventures .
High churn means customers are unhappy, low gross margins mean poor unit economics, and that so called magic number?
“You can calculate it by adding the new one Take ARR divided by your marketing and sales spend, âwrites Nahm. “Remember, however, that the magic number is a lagging indicator and it can take a few quarters to see a positive result.”
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If you’re methodical to build a larger customer base, nurturing steady growth isn’t difficult.
Marketers who work with whatever change how the wind blows – or blindly following the idea of ââother best practices – are less likely to be successful.
“The not-so-secret secret here is that the key to good customer loyalty is really simple âSaid growth expert Susan Su recently at TechCrunch Early Stage: Marketing and Fundraising. “It’s about developing a product that solves a real and particularly stubborn problem for people.”
In an interview with Managing Editor Eric Eldon, Su discussed a variety of topics, including tips on how to start a business Investors should talk about growth and their methods of developing an exemplary qualitative growth model.
“I firmly believe that every founder should try their luck in growth,” said Su.
Thank you for reading Extra Crunch this week!
Walter Thompson Senior Editor, TechCrunch @ yourprotagonist
How we built an AI unicorn in 6 years
F New startups are joining us exactly the product that its founders first envisioned.
Today, Tractable is known for developing technology that allows drivers to upload photos of their vehicles after a collision so that the AI ââcan assess the damage can. However, the first paying customer used Tractable to check the welds of plastic pipes.
And as fate would have it, this customer also fired them when the founders increased their first lap.
“We struck gold with auto insurance,” says co-founder Alex Dalyac, as it was “a huge and inefficient market with an urgent need for modernization.”
In an Extra Crunch guest post, he shares several insights the past six years of unicorn scaling that are of value to founders of all stripes. Step one?
“Look for complementary co-founders who will become your best friends,” advises Dalyac.
The European VC market is so hot it may skip its summer vacation. h2>
Alex Wilhelm and Anna Heim continued their exploration of the searing global VC market, this time with a view to Europe.
For perspective, they analyzed data from Dealroom and spoke to four VCs about it Investment climate of the continent:
Diana Koziarska, SMOK Ventures Vinoth Jayakumar, Draper Esprit Simon Schmincke, Creandum Javier Santiso, Mundi Ventures
“There is little evidence that what we saw from Europe in 2021 will slow down in the third or fourth quarter,” write Alex and Anna.
“While Europe is known for long summer vacations, investors don’t expect a big – if any – slowdown in Europe in this sun-drenched quarter.”
Startups and investors are turning to micromobility subscriptions
” Amid the chaos of the COVID-19 pandemic and the grim road to profitability of shared electric micromobility, there are more and more Companies turned towards subscriptions, “writes Rebecca Bellan in a summary on the future of micromobility.
” It’s a business model that some founders and investors argue that it hits the sweet spot of the profit center – an approach This hat appeals to customers who are careful about sharing and who pay upfront to own a scooter or e-bike while minimizing overheads and asset depreciation. â
As for Robinhood’s warnings for crypto trading via coinbases. say say near future
After realizing that Robinhood expects sales to decline in the third quarter due to slowing crypto trading, Alex Wilhelm began to wonder what that forecast means for Coinbase.
“The now public Einhorn has seen crypto ups and downs, âhe writes. “A decline in consumer interest over the next few months or quarters is not a big deal, provided you keep perspective long enough and the crypto-infused future that fans expect is about to materialize.”
But it will ?
Dear Sophie: Should we look to Canada to keep international talent?
Dear Sophie ,
As a consultant, I take care of people ops at various tech startups. Many have OPT or STEM OPT employees who were not selected in this year’s H-1B lottery.
Companies want to keep these people, but they are running out of options. Some companies will try the H-1B lottery again next year despite facing high odds, especially if the H-1B lottery turns into a reward-based selection process next year.
Others are looking for O-1A visas but are finding that many employees do not yet have the experience to meet the qualifications. Should we take a look at Canada?
– Silicon Valley Specialist
Silicon Valley communications expert Caryn Marooney explains how to put the story on the Point brings
Caryn Marooney, a Silicon Valley communications professional turned venture capitalist, spoke extensively at TechCrunch about early stage storytelling: marketing and fundraising.
During her time in Silicon Valley, she helped companies like Salesforce, Amazon, F acebook and more bring products to market and sharpen their messages. In 2019, she left Facebook, where she was VP of Technology Communication, and joined Coatue Management as General Partner.
Marooney uses the acronym RIBS to describe her basic startup messaging strategy: relevance, inevitability , Credibility and keep it simple.
Canada’s startup market is booming alongside hot global VC investments
Alex Wilhelm and Anna Heim took a look at Canada for The Exchange VC market in the first half of 2021, and if you’ve read their paper you know what’s coming.
Canada, like the rest of the world, was absolutely scorching in the first half of the year.
“Canada’s venture capital results can now rival those of the entire Latin American region, with exits and mega-deals roughly on par in the second quarter, and a similar number of venture capital rounds overall,” they write.
“That caught our attention.”
Greylock’s Mik e Duboe explains how to define growth and build your team