This Week in Startups SaaS multiple compression, downturn outlook & advice for new VCs with Jason Lemkin of SaaStr | E1461
15 snips
May 16, 2022 
Join Jason Lemkin, founder of SaaStr and a SaaS investment expert, as he shares invaluable insights on surviving and thriving in a downturn. He offers essential advice for new VCs, focusing on how to assess quality revenue and avoid common pitfalls. The conversation dives into the future of SaaS investments and the importance of playing offense, even in tough times. Jason also touches on the dynamics of valuations and the significance of profitability, shedding light on opportunities and challenges in the evolving SaaS landscape.
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Advice for New Fund Managers
- New fund managers relying on momentum investing must adapt their strategies.
- They need to originate deals, perform thorough due diligence, and focus on companies with strong fundamentals.
Quality of Revenue
- Quality of revenue is crucial, particularly regarding gross margins and recurring revenue.
- Investors are scrutinizing these factors more closely, especially with the increased focus on profitability and cash flow.
Playing Offense in Downturn
- In down markets, startups with sufficient runway should play offense and surpass nervous competitors.
- Focus on essential activities, optimize resource allocation, and capitalize on opportunities created by market uncertainty.