Mats Hoefler

🎙️Podcast alert: Had a great catch-up with Kai on 🤝𝑪𝒍𝒐𝒔𝒆 𝒕𝒉𝒆 𝑫𝒆𝒂𝒍🤝 this week (🇩🇪) After our first session last year, we again talked about the latest developments in the SaaS and M&A market. Topics we've covered: ➡️ Our approach with saas.group, ➡️ Where we stand and what our goals are, ➡️ Current SaaS and M&A market trends, ➡️ How to properly value a SaaS business, ➡️ Role of AI in SaaS and M&A, ➡️ And more... You can check it out on all relevant podcast platforms. Links to Spotify and Apple below: 🟢 Spotify: https://lnkd.in/gn8RaVpD 🟣 Apple Podcasts: https://lnkd.in/g3kBWSBW Enjoy listening! 🙌 @ Kai, Anja + team: Thanks again for having me. Happy to speak again next year and see how good or bad my predictions were.

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Last month, we were proud to host our first CFO Dinner in Berlin. It was a relaxed evening full of engaging conversations, with no set agenda which allowed us to dive into a multitude of topics ranging from CFO-specific (funding, systems and hiring trends) to broader financial topics, e.g. being at the forefront during the financial crisis but also personal anecdotes about growing up vs. settling in Germany. We were thrilled with the positive feedback from our guests, lots of whom expressed interest in a follow-up. Here's just a few quotes: "I particularly enjoyed the quality of the attendees and thought the dinner setting was conducive to having quality and entertaining conversations. You also picked a really nice restaurant. " "It was quite nice overall to be able to talk without having a presentation or similar which sometimes is not that relevant for all participants." "The most interesting topics for me were people discussing their work cultures, attempts to incentivise people back to the office and how as CFOs everyone sees you as the generalist problem solver for the whole business." A big thank you to everyone who joined us! Already looking forward to the next one. Thomas Antonioli Anurag Bansal Tom Cherry Jan Gackenholz Julia Heintel Benjamin Molzahn Ebony Simone Morczinek Christian Müller Kerimcan Oral Dr. Stephan Tingler Sahar Powell (PhD) Borjan Nikolov Ilya G. . . . #TheBigSearch #CFO #MarketInsights

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This is about right. If you want to be a founder, you need to have the resilience to overcome anything. You need to have a firm conviction that you can do what the man in the video is doing, figuratively of course.

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🚀 Our 2024 SaaS Sales Salary Benchmark Report is here! 🚀 Attracting and retaining top sales talent in Germany starts with having the right compensation strategy. That’s why we’ve created this comprehensive report to give you the latest insights into SaaS sales salaries in Germany for 2024. Inside, you’ll find everything from salary benchmarks for SDRs, AEs, and Sales Leaders, to OTEs and commission structures and much more. It’s all the data you need to make smarter hiring decisions and stay competitive in the market. 👉 Get the report now! Link in the comments. 🐺💜 #sales #hiring #recruitment

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⏰ 𝗝𝘂𝘀𝘁 𝟭 𝘄𝗲𝗲𝗸 𝗹𝗲𝗳𝘁 𝘁𝗼 𝗮𝗽𝗽𝗹𝘆 𝗳𝗼𝗿 𝗪𝗘𝗖𝗢𝗡𝗢𝗠𝗬! ⏰ At #WECONOMY, founders win what money can't buy: The competition brings founders together with experts and managers right up to the executive boards of the German economy. Are you a tech start-up and want to take your business to the next level?  This is your chance! ✔️ 𝗪𝗵𝗼 𝗰𝗮𝗻 𝗮𝗽𝗽𝗹𝘆? Start-ups in the early stage / pre-seed phase as well as start-ups that have not yet been founded with proof of concept or pilots. ✔️ 𝗪𝗵𝗮𝘁 𝗳𝗶𝗲𝗹𝗱𝘀? We are looking for startups with a focus on STEM and technology. MedTech, FinTech, AgriTech ... the possibilities are endless! ✔️ 𝗔𝗿𝗲 𝘆𝗼𝘂 𝗮 𝗱𝗶𝘃𝗲𝗿𝘀𝗲 𝘁𝗲𝗮𝗺? Not a must, but all the better. After all, it has long been known: More diverse teams are more successful. Any questions? Message Christine Heuwing or comment below! ⏰ 𝗔𝗽𝗽𝗹𝘆 𝘂𝗻𝘁𝗶𝗹 𝗠𝗼𝗻𝗱𝗮𝘆, 𝗝𝘂𝗻𝗲 𝟮𝟰! WECONOMY is an initiative of Wissensfabrik - Unternehmen für Deutschland e.V. in cooperation with UnternehmerTUM and Handelsblatt.

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A business lesson that took me a few years to learn: 🗓️ 2020: I was part of the RBF hype from 2020-2022. RBF is short for Revenue-Based Financing. The RBF hype was a period of exceptional innovation in the dusty VC world. Together with Christian Stein, I built the business of a US fund in Europe from scratch. To many of my friends’s dismay, I posted a ton about RBF here on LinkedIn. I even co-authored a chapter on RBF in an investment book published by Springer 🤓 It was a *super competitive* time to be in the market! New funds entered the market every week. We expected unicorns and fairytales. All of us would flourish and continue to grow for years to come. Taking a bite out of that delicious VC cake. If there was a choice, my default decision was the faster, riskier, bolder bet. Being 26 years old, I only knew one direction of the market: up 📈 🗓️ 2024: A few years later, almost every single one of our old competitors is gone 💀 They went bankrupt, exited in a fire sale, or changed their business model. My old fund, Riverside Acceleration Capital, is still around. They played a different game all along. Focused on long-term viable partnerships. True better-together stories, even if that meant sacrificing hyper-growth. Back then, I didn’t understand how exceptional the market was that I found myself in. I didn’t understand that ZIRP was driving +99% of the investment decisions. I didn’t foresee that the shining stars of our industry would go down in flames in just a few years. Today, I am in the middle of a completely different trend. Again, I see competitors popping up left and right. Gitpod has become so successful that it inspires others to take a bite out of the CDE cake. 🍰 But I’ve learned my lesson. They truly don’t matter. Most of them will not be around 5 years from now. But one company will be there: Gitpod. If you are selling a product or service, keep that in mind: Being long-term viable is extremely important. Price accordingly. If new entrants underprice the market and sell at a loss, don’t worry. You are building long-term partnerships that require a business model that works. Make it real and share this idea in conversations with business partners and customers: smart buyers will value long-term viability over saving an extra 5%. Today, I am ready to explain and defend our long-term viability at any moment. I love collecting these business adventures. I’ve spent more time in Excel sheets than I care to admit. But some lessons need to be hard-won over the years :)

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What is one of the most common early red flags in the investment process? Timo: "Broken cap tables" 😬 In this video, Timo explains what a broken cap table means, why it's a problem for VCs, what typically leads to cap table issues, and what options startups have for fixing them 💡

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Street Parade and VCs? 🤔 Sure! I had the pleasure of welcoming seven US VCs to the Zurich Street Parade this weekend. Beyond the music, the partying, and the great atmosphere - we had the opportunity to discuss: 👉 The state of #AI - in terms of #investment, #talent and competence upgrades in corporate organisations, and the role of #techindustry in promoting a realistic, applicable but still ambitious adoption of AI 👉 Business models and investment in #spatialcomputing and the potential to reshape perception of what being digital means 👉 The challenge of contextual relevance in AI itself compared to the workings of the human mind 👉 The glimmer of a new wave of investment in communities where it is not about connections but connectedness - and ways of measuring real connectedness #VCs #CVC #angelinvestors #deeptech

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How to measure success in restructuring key business units, functions or transformations? By Thomas Kessler Managing Partner at Integration Success GmbH and Atlantic M&A Partners | Pioneer in AI and M&A Integrations | I was recently pinged by Sofoklis Yiannacou, FCCA with a very interesting question following one of my posts: "How do you measure restructuring of key business units or functions or transformation?" My answer: Measuring the restructuring or transformation of key business units or functions requires a comprehensive approach that combines quantitative and qualitative metrics. Key performance indicators (KPIs) such as: + Financial metrics (e.g., revenue growth, cost positions), + Operational efficiency measures (e.g., productivity rates, process efficiency and technological, service, and product differentiators), + Customer-related metrics (e.g., satisfaction scores, retention rates) provide a quantitative foundation. These are complemented by project-specific KPIs that track milestones, budget adherence, and timeline compliance. A perfect tool to drive performance in transformation is the GE 9Box Matrix. Maybe long forgotten and yet still tremendously powerful to drive success in transformations. My answer also has to highlight - the importance of the human-centric aspects - of restructuring! This involves explaining the changed purpose and ensuring people buy-in to the picture painted for the joint future. The success of your new strategic direction can be measured by tracking employee metrics like engagement scores, turnover rates, and time-to-hire for new positions. Additionally, qualitative assessments through surveys and interviews can gauge employee sentiment, cultural alignment, and adoption of new processes or technologies. Leadership effectiveness in guiding the transformation, fostering open communication, and addressing employee concerns is another vital human-centric factor to evaluate. Leadership effectiveness is also achieved if the leadership team is fully aware of its strengths, motives and desires. The use of psychometric tools like motivationfinder.com, and https://lnkd.in/giRU__bs have been tremendously helpful for my clients when used in transformation projects. By balancing hard metrics with these human-centric approaches, measuring the success of organizations is one approach that has proven to be massively helpful in the restructuring or transformation process. They help to measure, progress and adjust the course taken all while making informed decisions and adjustments to ensure success. What is your point of view on measuring success in restructuring key business units, functions or transformations?

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$3-6M ARR SaaS companies with moderate growth (15-30%) enter the no-mans land of capital. ❌They are too large for a seed check ❌ Not growing fast enough for a Series A ❌ Debt providers offer too little capital and amortize quickly, and ❌ Too small for private equity Luckily, I’ve found a few funds with a viable option for companies at this juncture: HYBRID FUNDS A hybrid fund offers a product with elements of debt and elements of equity. This can take the form of a term loan with minimal amortization but with a warrant to create equity upside or it could come in the form of two securities invested at the same time such as a term loan and a convertible note. With structures like these, the funds often are willing to put up more capital. Sometimes as much as 1.5x ARR. This level of investment gives a founder the firepower they need to scale their way to $10 million in ARR. Once the $10 million ARR milestone is reached, the world of private equity becomes a lot more attractive to founders. They are able to sell shares creating a large windfall for founders and employees AND maintain some ownership in the go-forward business creating an opportunity for another windfall down the road. Do you know any founders using or interested in this capital pathway?

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Multiples – Why EBITDA matters It used to be, not too many years ago, that SaaS companies were almost purely valued as a multiple of Revenue. Today, according to a recent report from Aventis Advisors, SaaS EV/Revenue multiples are less than 1/3 of what they were just two years ago, a 66% decrease. Interestingly enough, valuations based on EBITDA (of those same companies), while they have dropped, have only decreased by 25%. In other word - EBITDA matters. Gone are the days where simply posting growing revenue streams was enough to garner a great valuation. Now, you have to be profitable. Get a complimentary Value Builder assessment to see where you’re falling short. It may not be pretty – but isn’t it better to know now and address it vs. have an investor or acquirer give you the bad news? Either way, we’re here when you’re ready. ✅ Click the link in the comments section to 2x Your Value for your Endgame✅

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Market size slide often misses the mark due to a standardized approach by pitch coaching. This template mandates the inclusion of TAM, SAM, and SOM in three bubbles. You can find such templates all over the internet. 👀 Everywhere I found that entrepreneur claims “Our global TAM is $X B, but we are going to start in a certain part where our SAM is $Y B. And we project that our SOM is $Z B” It’s clear why entrepreneurs try to pump up their market size. They’ve been told that VC only interested in unicorns, and so they assume that the best way to become a unicorn is to go for the largest market. The thinking is that it's easier to get 2% of a very large market than it is to get 20% of a smaller market. So, they search for market data that allow them to claim that their TAM is $56B, or $256B, or even better, $2.5T. When this slide appears, most investors chuckle. Investors generally don’t give any credence to the market size. We may still ask founders how big their target market is, but the point is to see 'how founders think about segmentation, not to rate the startup based on how big they think.' 💡 Savvy investors prefer startups go after a market that doesn't yet exist. Better to create the market than try to unseat established competitors. Rather than claiming that you can disrupt a existing market, what’s more relevant and compelling is how you answer questions such as: 👇 1. Who are your target customers? 2. How will you reach them? 3. How many can you reach? 4. How will you convert them? 5. How many can you convert? 6. How will you onboard them? 7. How much will that cost? 8. What is a customer worth? 9. How many customers will you acquire this year,Next year,The year after? Most investors want to see market opportunity, not market size. They need to see that you understand more about your approach of reaching & onboard customers. Founders should build a bottom-up model that demonstrates how you will build a big, profitable, customer by customer business. Don’t suggest that your focus is on acquiring market share in a large market. 🙆‍♀️ We’ve heard several pitch on wearable technologies for dogs. They claim - there are 90M dogs in the US alone — at $9.95 a month subscription, that’s a $10B market! But truth is It doesn’t matter if there are only 20M or 200M dogs. What matters is how many dog owners the entrepreneur can convince, one by one, to sign up for this service. Define your target precisely, like "urban professionals, 25-35, earning $80,000+, active Instagram users, and dog owners." Entrepreneur should stop pitching the typical market-size slide. Instead, they should show investors that they understand the market opportunity customer by customer.💡 Check out my free newsletter for more insights: https://lnkd.in/dKZQKHg2 . #startups #funding #fundraising #founders #investors #VC #angelinvestors #founder #fund #money #runway #marketsize #market #entrepreneurship #entrepreneur #customers

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A milestone worth celebrating! Five years ago, our Index Ventures team launched #NotOptional alongside more than 500 CEOs and founders to improve stock options and conditions for employee ownership at European startups. A lot has changed since we started in 2019: The most celebrated win so far goes to Germany 🇩🇪, one of the biggest economies in the world that used to have one of the worst stock options policy in Europe. Last year, the German Parliament voted to turn their failing policy into one of the best in the world. 10 other countries also updated their stock options legislation: the UK 🇬🇧, Portugal 🇵🇹, France 🇫🇷, Austria 🇦🇹, Czechia 🇨🇿, Spain 🇪🇸, Latvia 🇱🇻, Lithuania 🇱🇹, Greece 🇬🇷, and the Netherlands 🇳🇱. 7 countries now have policies that match or exceed the US: Germany, France, Portugal, the UK, Lithuania, Estonia and Latvia. Only one, Estonia 🇪🇪, already had a policy better than the US in 2019. That includes Europe’s three largest economies and the largest VC hubs. There’s still a long way to go for some countries. Finland 🇫🇮, Switzerland 🇨🇭 and Norway 🇳🇴 have the worst policies, followed by the Netherlands (even with updated legislation already), Belgium 🇧🇪 and Denmark 🇩🇰. These are countries with strong tech credentials where the tech innovation flywheel is being hampered. With the help of European entrepreneurs everywhere, we will keep pushing until every single European country’s options policy is at least as attractive as the US! There is no reason why they can’t be. We are also working on taking it to the next level: standardization at the EU level through a single corporate entity. The “EU Inc.” initiative launched earlier this month and builds on the success of #NotOptional at Andreas Klinger European Accelerationism. Thankfully, the challenges European startups face are more in the spotlight than ever because of Mario Draghi’s report to the European Commission in September, which emphasized that innovative startups should have the opportunity to adopt a new EU-wide legal statute. Already, the European Commission has established a Stock Options Working Group, the European Securities and Markets Authority has urged the Commission to consider a dedicated EU-wide framework for ESOPs, and commission president Ursula von der Leyen appointed the first-ever commissioner for startups. Every improvement makes it easier for startups to attract and retain talent and makes it more likely that the next tech giant will come out of Europe. To everyone involved in this fight, congratulations on five years of progress. Now let’s keep going!

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💻 For all SaaS startups - this overview of 2,500 SaaS companies gives key findings. Founders, it's time to reflect. Steady growth, driven by a strong focus on client retention and expansion, might just be the new normal for the years ahead. Now, more than ever, it's crucial to prioritize and nurture your relationships 🤝with clients. More details👇🏼

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Start-ups in Europe: a light at the end of the tunnel - finally!    This article by Nadine Schimroszik in Handelsblatt gives reason for hope for the tech ecosystem, as it summarises a development that has been tentatively emerging for some time: The number of new #start-ups in Germany is growing again, by 17 per cent, as shown by a comparison of the first quarter of 2024 with the same quarter of the previous year.   💡It is particularly interesting to see that most investments are being made in AI. An unmistakable sign that they continue to be a driver of innovation for the German startup ecosystem.   We recently came to a similar conclusion with my team, as part of our analysis of the German startup landscape. Our conclusion: more and more funding are being mobilised for ♻️ #Greentech business ideas that are based on AI-based technologies and have a positive impact on our planet. More info on our research at IRIS can be found in Startup Insider`s Investors Report 2024: https://lnkd.in/dU-5AMPz More info on Nadine’s insightful article here: https://lnkd.in/depicwGA

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Y-Combinator Guide: How to Split Equity between Cofounders & When You Should (and Shouldn’t) Split… https://buff.ly/3WoVkav The Y-Combinator Guide delves into the intricate process of splitting equity among cofounders, outlining the crucial considerations and scenarios where equity division is warranted. Understanding the dynamics of equity distribution is essential for fostering a fair and sustainable partnership. By exploring real-world examples and statistics, cofounders can navigate this challenging aspect of startup collaboration more effectively. It is crucial to establish clear guidelines and agreements to prevent potential conflicts in the future. This guide provides valuable insights for entrepreneurs embarking on new ventures. #StartupEquity #CofounderCollaboration #venturecapital #startups

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When it comes to bookkeeping in startups, scaleups and SMEs, there is no way around DATEV eG 📚 But how should reports such as SuSa, BWA and "Chefübersicht" be analyzed? Our Finance experts have created a detailed checklist to give you a better overview of your DATEV documents 💡 You can download it for free at the following link: https://lnkd.in/e25uwFB6 With the checklist, you will learn how to interpret reports correctly and create the basis for reliable accounting and controlling ✅ #datev #checklist #freedownload #accounting #controlling

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I have news to share: In the upcoming months, you will see more of me in Business Insider Gründerszene as I share some of my perspectives on the startup ecosystem as a founder turned investor. First up: Why do start-up companies with remote-only employees face significant disadvantages, and why am I reluctant to invest in them? A take that I’m aware everyone won’t agree with... but I rest my case here! Here are three key takeaways: The importance of a strong corporate culture: A strong corporate culture, built when actually working together, is essential for the success of all startups. It fosters engagement and builds loyalty - crucial for a company’s stability and growth, especially during uncertain times. The risks of remote work: Remote work increases the risk of communication errors, delays in information sharing, team-building challenges, and potential employee isolation, which can hinder team development. The importance of a balanced approach: Hybrid teams must invest in building and maintaining a strong corporate culture through regular in-person interactions, team-building sessions, and coaching to keep employees motivated. Thanks to the team at Gründerszene for a great collaboration – more to come! Read the full article here: https://lnkd.in/dgD-KUBr

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