Confused by the seamingly never-ending list of abbreviations in the SaaS space?

 

Lets explore some of the most common below!

 

Technology & Development

 

SaaS (Software-as-a-Service)

A subscription model for software which is accessed by users over the internet, typically through a web browser interface.

 

IaaS (Infrastructure-as-a-Service)

A form of cloud computing that provides virtualized computing resources over the internet.

 

PaaS (Platform-as-a-Service)

Provides a platform allowing customers to develop, run, and manage applications without the complexity of building and maintaining the infrastructure.

 

GTM (Go To Market)

A go-to-market (GTM) strategy is a plan that details how an organization can engage with customers to convince them to buy their product or service and to gain a competitive advantage.

 

Growth Terminology

 

‘Unicorn’

A unicorn is a privately held start-up company valued at over $1 billion. E.g.: Uber, Airbnb, Alibaba, WeWork, Sprinklr, Tanium, Snowflake.

 

‘Golden’ Unicorn

When a company valued at $1bil is profitable.

 

‘Centaur’

The Centaur is a business that reaches $100 million of annual recurring revenue (ARR)

 

Hyper Growth

Hypergrowth is what takes place on the steep part of the growth curve. It is a dizzying, company-stretching type of growth. Think: Facebook, Google, Alibaba.

 

Funding & Investment

 

Angel investor

The first investor, normally friends/family/bank etc... Angel investors will put in a variety of amounts, but as it's generally seed funding, you're not looking at the kind of figures that VC investment deals with. As a rule, groups of angel investors might go as high as £1 million – but VC firms are unlikely to invest less than £1 million.

 

VC (Venture Capitalist)

An investor who either provides capital to start-up ventures or supports small companies that wish to expand.

 

PE (Private Equity)

Private equity, in a nutshell, is the investment of equity capital in private companies. In a typical private equity deal, an investor buys a stake in a private company with the hope of ultimately realising an increase in the value of that stake

 

IPO (Initial Public Offering)

When a company takes their company public on the Stock Exchange.

 

Seed Funding

The very first money that many enterprises raise — whether they go on to raise a Series A or not — is seed funding.

 

Series A

In a Series A round, startups are expected to have a plan for developing a business model, even if they haven’t proven it yet. They’re also expected to use the money raised to increase revenue. - Usually, $2million to $15 million.

 

Series B

A startup that reaches the point where they’re ready to raise a Series B round has already found their product/market fit and needs help expanding.

The big question here is: Can you make this company that you’ve created work at scale? Can you go from 100 users to a 1,000? How about 1 million?

 

Series C

Companies that make it to the Series C stage of funding are doing very well and are ready to expand to new markets, acquire other businesses, or develop new products.

Commonly, Series C companies are looking to take their product out of their home country and reach an international market. They may also be looking to increase their valuation before going for an Initial Public Offering (IPO) or an acquisition.

For their Series C, startups typically raise an average of $26 million.

Valuation of Series C companies often falls between $100 million and $120 million, although it’s possible for companies to be worth much more, especially with the recent explosion of “unicorn” startups

 

Series D

A series D round of funding is a likely more complicated than the previous rounds. As mentioned, many companies finish raising money with their Series C.

However, there are a few reasons a company may choose to raise a Series D.

The first is positive: They’ve discovered a new opportunity for expansion before going for an IPO but just need another boost to get there. More companies are raising Series D rounds (or even beyond) to increase their value before going public. Alternatively, some companies want to stay private for longer than used to be common. Each of these are positive reasons to raise a Series D.

The second is negative: The company hasn’t hit the expectations laid out after raising their Series C round. This is called a “down round,” and it’s when a company raises money a lower valuation than they raised in their previous round.

 

Series E

If few companies make it to Series D, even fewer make it to a Series E.

Companies that reach this point may be raising for many of the reasons listed in the Series D round: They’ve failed to meet expecta7ons; they want to stay private longer; or they need a little more help before going public.

 

Series F

It is very rare companies get to Series rounds in their funding. See definitions in ‘Series E’.

 

 

Revenue Metrics

 

MRR (Monthly Recurring Revenue)

A financial metric that measures the income a company expects to receive from customers each month. 

 

ARR (Annual Recurring Revenue)

Revenue Value of the contracted recurring revenue in a 1-year period

 

ACV (Annual Contract Value)

The total value of a customer’s contract over a year.

 

TCV (Total Contract Value)

Total contract value is an important metric that measures how much a contract is worth after it's been executed, including recurring revenue and fees (onboarding fees, professional service fees, etc.).

 

ARPU (Average Revenue Per User)

Measures how much revenue is earned per customer over a given period.

 

ASP (Average Selling Price)

The average price at which a company sells its product or service.

 

CAC (Customer Acquisition Cost)

The cost of acquiring a new customer, including marketing and sales expenses.

 

CLTV / LTV (Customer Lifetime Value)

The total revenue a business can expect from a customer throughout their relationship.

 

DBNRR (Dollar-Based Net Revenue Retention)

Measures revenue growth from existing customers, accounting for upgrades, downgrades, and churn.

 

NRR (Net Revenue Retention)

The percentage of recurring revenue retained from existing customers over a period, including upsells and churn.

 

PQL (Product-Qualified Lead) 

A lead who has demonstrated strong engagement with the product and is likely to convert into a paying customer.

 

QRR (Quarterly Recurring Revenue)

Recurring revenue calculated on a quarterly basis.

 

RPU (Revenue Per User)

Similar to ARPU, but focuses on revenue generated per active user instead of per customer.

 

Product and Growth 

 

AARRR (Acquisition, Activation, Retention, Referral, Revenue)

A popular growth framework that tracks key stages of the customer journey.

 

API (Application Programming Interface)

A set of rules that allow software applications to communicate and share data.

 

ARPA (Average Revenue Per Account)

Measures how much revenue is generated from each customer account.

 

BI (Business Intelligence)

The use of data analysis tools to make informed business decisions.

 

CAC Payback (Customer Acquisition Cost Payback Period)

The time it takes for a customer to generate enough revenue to cover their acquisition cost.

 

CSAT (Customer Satisfaction Score)

A metric that measures customer happiness with a product or service.

 

DAU (Daily Active Users)

The number of unique users who engage with a product on a daily basis.

 

MAU (Monthly Active Users)

The number of unique users who engage with a product on a monthly basis.

 

NPS (Net Promoter Score)

A customer loyalty metric that measures how likely customers are to recommend a product.

 

PMF (Product-Market Fit)

The stage where a product satisfies strong market demand, leading to sustainable growth.

 

PS (Professional Services)

Consulting, training, or implementation services offered alongside a SaaS product.

 

SLG (Sales-Led Growth)

A go-to-market strategy where the sales team drives customer acquisition and revenue growth.

 

PLG (Product-Led Growth)

A strategy where the product itself drives customer acquisition, retention, and expansion.

 

Sales Cycle

A sales cycle is the total amount of time it takes for a business-to-business (B2B) sales organization to close a sales deal, starting from the first time a customer is engaged to when the deal is won or closed.

 

Order Value

Order Value means the price of the Goods and/or Services as stated in the Purchase Order

 

Hunting

A hunter in SaaS sales is a salesperson who focuses on acquiring new customers. The goal of the hunter is to identify potential customers, reach out to them, and close deals. Hunters are typically responsible for generating leads, conducting product demonstrations, negotiating contracts, and closing sales.

 

Farming

A farmer in SaaS sales is a salesperson who focuses on building and nurturing long-term relationships with existing customers. The goal of the farmer is to ensure that customers are satisfied with the product or service and to upsell or cross-sell additional products or services to them.

 

Geographical Terminology

 

EMEA (Europe Middle East and Africa)

Generally accepted to include all European nations, all African nations, and extends east to Iran, including Russia.

 

APAC (Asia-Pacific)

Includes: China, India, Japan, South and North Korea, Australia, Taiwan, Malaysia,

 

BENELUX

Be – Belgium

Ne - Netherlands, &

Lux – Luxembourg

 

DACH

D - Germany,

A - Austria &

CH – Switzerland

 

NORDICS

Nordic Countries - Denmark, Finland, Iceland, Sweden, Norway

 

Verticals

 

MarTech (Marketing Technology)

Marketing technology, or MarTech, is a term that refers to the various tools and technologies that businesses use to automate, streamline, and optimize their marketing efforts.

 

CX (Customer Experience)

Customer experience (CX) refers to how a business engages with its customers at every point of their buying journey—from marketing to sales to customer service and everywhere in between. In large part, it's the sum total of all interactions a customer has with your brand.

 

Cyber (Cyber Security)

Cyber security is the application of technologies, processes, and controls to protect systems, networks, programs, devices and data from cyber-attacks.

 

IAM (Identity & Access Management)

Identity and Access Management (IAM) is a security and business discipline that includes multiple technologies and business processes to help the right people or machines to access the right assets at the right time for the right reasons, while keeping unauthorized access and fraud at bay.

 

DevOps (Development Operations)

A set of practices for automating the processes between software development and information technology operations teams so that they can build, test, and release software faster and more reliably.

 

DevSecOps (Development, Security, and Operations)

A development practice that integrates security initiatives at every stage of the software development lifecycle to deliver robust and secure applications.

 

AppSec (Application Security)

AppSec is the process of finding, fixing, and preventing security vulnerabilities at the application level, as part of the software development processes.

 

CI/CD (Continuous Integration and Continuous Delivery)

CI and CD stand for continuous integration and continuous delivery / continuous deployment. In very simple terms, CI is a modern software development practice in which incremental code changes are made frequently and reliably.

 

Developer Tools

Developer tools are supplement efficiency tools that computer programmers use to make their lives easier. These include tools like Git and Emmet and programming libraries like Node. js or Django.

 

Data

The data that drives the SaaS methodology model can be categorized into three types: volume metrics, conversion metrics, and absolute time metrics. Each of these work in systems to drive the different stages of revenue generation: customer acquisition, recurring revenue, and lifetime value.

 

Big Data

The definition of big data is data that contains greater variety, arriving in increasing volumes and with more velocity. This is also known as the three Vs. Put simply, big data is larger, more complex data sets, especially from new data sources.

 

Artificial Intelligence

Artificial intelligence is the science of making machines that can think like humans. It can do things that are considered "smart." AI technology can process large amounts of data in ways, unlike humans.

The goal for AI is to be able to do things such as recognize patterns, make decisions, and judge like humans.

 

Machine Learning

Machine learning is an application of AI that enables systems to learn and improve from experience without being explicitly programmed.

Machine learning focuses on developing computer programs that can access data and use it to learn for themselves

 

 

Selling Methodologies & Frameworks

 

BANT

BANT is an acronym that stands for "Budget, Authority, Need, Timing."

It provides a simple framework for qualifying prospects in a business-to-business (B2B) sales setting. An organization evaluates whether, and to what degree, a sales prospect meets each of the four criteria.

 

Challenger Selling

Challengers intentionally dispute their customer's way of thinking and force them to contemplate a new perspective. This creates some slight tension in the form of a casual debate. By encouraging their customers to consider new opportunities, the Challenger sales rep can begin to offer an alternative way forward.

 

Command the Message

Command the Message is a sales methodology developed by Force Management that focuses on helping sales teams articulate value, differentiate their solution, and drive customer alignment throughout the sales process. 

 

Conceptual Selling

Concept selling, or conceptual selling, uses the premise that customers buy the concept of a solution and not the solution itself. For example, you don't buy a sports car because of its horsepower or how quickly it goes from 0–60. You buy it because of how it makes you feel.

 

Consultative Selling

What is consultative selling? Consultative selling is an approach that focuses on creating value and trust with a prospect and exploring their needs before offering a solution. The salesperson's first objective is building a relationship; their second is providing the right product.

 

Consumer Centric Selling

The customer-centric sales methodology promotes meaningful conversations with prospects to identify their needs and find solutions that solve their challenges. The salesperson targets critical decisionmakers and asks questions to understand their situation, align with their needs, and offer relevant solutions.

 

MEDDIC

The MEDDIC sales qualification is a framework that helps sales teams to qualify their sales opportunities by focusing on six important elements which are the: Metrics, Economic Buyer, Decision Criteria, Decision Process, Identify Pain, and Champion.

 

MEDDPICC

The MEDDPICC sales qualification is a framework that helps sales teams to qualify their sales opportunities by focusing on eight important elements which are the: Metrics, Economic Buyer, Decision Criteria, Decision Process, Paper Process, Identify Pain, and Champion, Competition.

 

NEAT Selling

N.E.A.T. is considered to be more effective as a lead qualification process—it helps you understand your prospects’ needs while eliminating prospects who wouldn’t be a good fit for your solution.

Need, Economic Impact, Access to Authority, Timeline

 

SNAP

In the SNAP selling method, the salesperson must embody the role of a “trusted partner.” Here, the goal is to connect the value of your solution to the problem the buyer wants to solve but doesn't have the time or mental bandwidth to tackle on their own.

Simple, Invaluable, Always Align, Priorities

 

Solution Selling

On the face of it, solution selling is a simple sales methodology: A sales rep diagnoses a prospect's needs and then recommends the right products or services to fill those needs. A solution selling strategy also demonstrates why the chosen product is a better fit than the competition. Using a sales process that is a problem-led approach to determine if and how a change in a product could bring specific improvements that are desired by the customer.

 

SPIN

SPIN selling is a sales methodology where reps organise sales calls using questions from four categories: Situation, Problem, Implication, and Need-payoff.

This approach shifts the focus to buyer challenges and allows reps to develop the consultative customer relationships that complex deals require.

 

SPICED

SPICED is a 5-step sales methodology and acronym that stands for Situation, Pain, Impact, Critical Event, and Decision.

 

Target

Target account selling (TAS) is a sales methodology that helps salespeople focus their time and energy on the accounts that are the best fit for their products or services.

 

The Sandler Selling System

Rather than push a product, the Sandler system teaches reps to build trust between themselves and their buyers. In doing so, the salesperson becomes a trusted advisor who can consult on the prospect's pain points and deliver a solution.

 

Value Selling

Value selling is a sales technique that focuses on helping prospects understand how a product or service can solve their problems, rather than highlighting the features and specs. In other words—what value will your products or services bring to their lives?

 

Marketing

 

ABM (Account-Based Marketing)

A targeted approach to B2B marketing that focuses on high-value accounts instead of broad lead generation.

 

BOFU (Bottom of Funnel)

The final stage of the sales funnel where leads are closest to making a purchase decision.

 

DTC (Direct-to-Consumer)

A business model where a company sells directly to customers without intermediaries.

 

ICP (Ideal Customer Profile)

A detailed description of a company’s perfect customer, based on firmographics and behavioral data.

 

MQL (Marketing-Qualified Lead)

A lead that has shown interest in a company’s offerings but isn’t yet sales-ready.

 

SQL (Sales-Qualified Lead)

A lead that has been vetted by sales and is ready for direct engagement.

 

TOFU (Top of Funnel)

The first stage of the sales funnel where companies attract and educate potential customers.

 

UGC (User-Generated Content)

Content created by customers or users that can be leveraged for marketing, such as reviews or testimonials.

 

Finance & Operations

 

ARR Churn (Annual Recurring Revenue Churn) 

The percentage of ARR lost due to cancellations or downgrades.

 

COGS (Cost of Goods Sold)

The total cost required to deliver a SaaS product or service.

 

EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization)

A measure of a company’s profitability.

 

GMV (Gross Merchandise Value)

The total sales value of goods sold via a platform, commonly used in e-commerce.

 

GRR (Gross Revenue Retention)

Measures how much revenue is retained from existing customers, excluding upsells.

 

LTVCAC Ratio (Lifetime Value to Customer Acquisition Cost Ratio)

Measures the efficiency of customer acquisition relative to lifetime value.

 

NPV (Net Present Value)

The value of future cash flows, adjusted for time and risk.

 

OPEX (Operating Expenses)

The total expenses required to run a business, excluding direct product costs.