From Launch to Series A: Having the Right Infrastructure & Monitoring in Place (2/10)

10 Prios Before You Reach 10k MRR — SaaS SMBs Ed.

About this series
This series of articles are drafted from our experience at Point Nine Capital on the top priorities for early-stage SaaS companies.
Note that though more relevant for startups who focus in SMBs first and then go upmarket, the priorities are general enough to apply to most SaaS companies.
In case you missed, here the first one

Priority 2: Having the Right Infrastructure & Monitoring in Place

At this early stage you don’t have much traction — so why would you bother about collecting data on such small numbers? Why would you think about scaling issues without actually having issues? … Surely this sounds like over-engineering? Is it a waste of time? Not exactly…

We all want to go fast…

Infrastructure: the basic physical and organisational structures and facilities needed for the operation of an enterprise

Setting the right infrastructure in place allows you to differentiate what’s working and what’s not working. That’s important even if it’s at a small scale!

Consequently, without the right monitoring tools, you’re flying blind on how that infrastructure is performing.

And you can also fail monitoring …

This doesn’t mean you can’t succeed without it, but it just gets harder to manage your future. Without monitoring your tech infrastructure, it’s harder to manage scaling issues; without marketing tools, how do you know your customer’s acquisition cost? Without finance, how do you know how much money is left? And so on.

Without investing time and effort setting that right early, you have some “debt”. And debt needs to be paid. The later you do it, the more expensive it tends to be…

In the next sections, you can find a (non-exhaustive) list of areas to look after early on:

a) The Tech “Infrastructure”

This is a topic for a blogpost in itself. As obvious as it might sound, we still see challenges with that. Early on, it’s important that startups think about:

• Architecture and tech choices that can easily scale to a certain level
• Tools to test and deploy software — with one click?
• Setting up monitoring in order to understand issues
• Good coding practices
• etc.

For most SaaS startups, we see that the winners are the ones who can balance the highest iteration speed without breaking down. Some areas that might help towards that goal are:

1. Developer tools for continuous deployment, autoscaling, feature flags, monitoring, etc. help you iterate faster.
2. Engineering resources are required to implement the right tools for your biz teams to iterate. If that’s not a priority for the tech team, the biz teams will suffer.
3. Poor build vs buy decisions will impact you: because something that you build requires maintenance and might slow you down, but something that you buy can break.

b) The Marketing/Product/Customer success “Infrastructure”

More important than almost everything else is to spend a large amount of your time speaking with potential customers. If you set the right tools in place early on, you can actually measure if what they say is aligned with what they actually do with your product.

Another benefit of setting those tools early on is that you can see how you’re progressing over time. That can tell you if things are going into the right direction, even if the sample is very small and erratic.

In term of tools, if you haven’t done it yet, please implement segment.io ASAP ;-) Apart from that one, others that should be on your stack are: google analytics (top funnel), mixpanel (activity), intercom (in app support), zendesk (customer support), delighted (NPS), chartmogul (SaaS key metrics), etc.

The goal of this set of tools is to help you answer with numbers at least some of the following questions:

c) Finances “Infrastructure”

It’s key to have the right tools to watch your cash :)

You should get somebody to help you (part-time?) to get your finances and accounting right from the beginning. You don’t want to have a messy company when you go through due diligences for potential investments. And for sure, you don’t want to have surprises with your cash available and runway. But you have more valuable things to do than learning bookkeeping.

If you set this “stack” well, you should have a KPI dashboard where you can see how your key metrics are progressing on a monthly basis. — here is a template from Christoph for that. By the way, Charmogul (from our portfolio) can come handy when it’s about computing your key SaaS metrics right — MRR, Churn, expansion, etc. ;-)

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Please contact me at@DecodingVC.

The next one is
3. Get Your Finance Plan Right

In case you missed the previous ones:
1. Setting the Right Goals