The SaaS market is expected to more than triple to reach $800 billion by the end of 2030. While tech funding declined overall last year, this sector continues to grow substantially, fueled by an increase in remote and hybrid work, demand for mobile applications, need for scalability and other factors. In fact, global spending on software is projected to reach around $8,700 per employee in 2025.
We sat down with Nick Hogan, a seasoned growth leader for PE-backed tech companies, to discuss trends in B2B SaaS funding and how companies can elevate their go-to-market (GTM) strategy to take advantage of growth opportunities post-investment.
Question: Despite an unpredictable investing climate over the last year, SaaS is expected to grow 214% by the end of the decade. What top things are investors looking for in today’s environment?
At a foundational level, one thing that’s incredibly important is durability. Although many SaaS companies pop up rapidly, it’s not easy to retain clients and sustain a business anymore. If you’re plateauing but maintaining market share, that can speak to the health of your business. Investors may evaluate whether you have true fans and how you’re building something that speaks to and grows with people. The ability and experience to see and handle inflection points is also key. When you hit a ceiling as a business, it takes resilient leadership and a dedicated team to successfully break through it. That can prove invaluable for future successes.
Question: How important is a strong brand when evaluating companies for investment and accelerator partnerships?
A common gap for small and medium-sized SaaS companies is not truly understanding who’s listening to them. That sounds basic, but many times software companies want their product to apply to as many companies and roles as possible. Not taking the time to understand from a customer perspective who finds your solution most valuable and why results in a lot of marketing waste. You need to understand how your brand is resonating externally, not just how it feels to you internally, so your brand is not centered on your perspective. Things like social presence, ads and content are important of course, but how a business messages, speaks to stakeholders and goes to market is critical. SaaS companies face dense competition, which makes it business-critical to understand their customers and prospects and put intention and investment into the right messaging. Many companies grow their brands well without it initially, but that isn’t sustainable.
To get a clear understanding of your brand, look beyond a vertical or industry. Focus on the user and how they see your product. For B2B SaaS brands, those insights are fuel to a potent GTM strategy.
Question: As the SaaS market grows both in terms of vendors and buyers, what are some areas brands are homing in on to differentiate themselves?
One pitfall I see is wanting to differentiate in the same old areas everyone else is. For example, price, ease of use or brand colors. There’s nothing wrong with that, but there are so many other ways to make your business stand out.
I believe the best way to differentiate is to figure out who your company really is. A lot of companies aren’t looking at what their unique strength is and then building on it. For example, if you're really creative, how do you push the envelope more? Some businesses have deep expertise, a lot of experience or are really consultative - if that’s the case, highlight that as your strength and use it to educate your audience better than anyone else.
The best brands are based on their own culture, and are real, meaningful and authentic. I like studying brands outside of B2B or SaaS, and I love the brand Oats Overnight for this reason. Their personality comes through in the way they market. For example, in one of their ads they read their worst reviews on video, which can be risky. But the truth is most of the bad reviews are for flavors that have 4-plus stars, so they knew most people wouldn’t agree with the bad reviews and this kind of ad would curry favor with their fans. On social media they encourage customers to speak their mind whether it’s positive or negative. This is their personality in all that they do. They show that they're a fun company - and while they’re doing that, they’re also checking the same boxes as their competition, but in a way that is memorable. That realness resonates with their audience as they grow. And there are B2B brands who are finding success with the same principle.
Question: What are some of the biggest marketing gaps - and opportunities - you are seeing with B2B SaaS companies looking to increase demand and growth? What do they need to elevate in order to maximize ROI post-investment or acquisition?
Tactically, it varies so much based on the business. Some of the basics always come into play when you want to accelerate to the next level. Investing in technology and making sure it meets your needs is one. This includes a new review of tech you’ve used for a long time; it might work well, but that doesn’t mean it’s the best for you at scale.
Another is making sure your people are always upskilling and growing. Part of the brand plateau is people - things get stale. It’s important to figure out ways to mix things up and try new ideas and ways of working. The more the team is upskilled, the more creative they feel about new ways to add value, which helps break through any ceilings you might be experiencing. It also helps with employee retention which is hugely important in this market.
Question: 70% of B2B decision-makers say they are now open to making fully self-serve or remote purchases. How are you seeing B2B SaaS marketing strategies and the sales cycle evolving as a result?
I don’t believe marketing is broadly responding to self-serve quickly. I see some brands making it easier to get further through the sales cycle - sometimes even to the transactional point - but not many.
A few years ago at a conference I learned about a pool company that created a web experience with very detailed questions about what type of pool the customer wanted. It’s interactive and engaging, and by the end, the customer need becomes very clear. Then when a sales person talks to that customer, they aren’t trying to sell a huge menu of pools. Instead, they cater to the customer, speaking to what they really want rather than trying to sell to them.
These kinds of experiences are a competitive advantage in a lot of markets, but at some point it will be expected by buyers. And it’s not an easy code to crack. To get a lot of information from a prospect is challenging, especially if it’s a complex product. But it’s a challenge worth taking in order to hit scale.
Question: AI is playing a significant role in SaaS company positioning. With the hype transitioning to real use cases, how do you envision this impacting marketing over the next year?
AI is already a standard tool for modern marketing. We’ve hit a big AI inflection point, so now it’ll get better over time.
I think it’s important to understand what you believe to be AI’s potential and its ceiling. Identifying both is paramount right now. I’ve seen content scale on a huge level with AI for a lot of businesses - for example, the ability to get started faster, put words on paper and get it to a workable place. AI’s potential is huge here.
But understanding its limitations is also important. AI-based content still doesn’t have the flow, warmth or personality we’re accustomed to, and often includes oddly structured sentences that need to be cleaned up. Audience interest wanes if you use AI for a lot of content. Figuring out how to maintain a human voice is important for the sake of readability. We don’t make content just for Google to crawl, but for people to read. Also, recent research has shown that while it can help scale content production, purely AI-generated content is proven to fall significantly in long-term search rankings, compared to human-written content. Using AI effectively requires marketers understanding how to embrace it for scale and support, but the need for expert content developers is still there.
Question: Do you have any final marketing tips for how SaaS companies can maximize growth after M&A or funding?
Speaking from my whole experience including both on the portfolio and business unit side, one of the biggest issues I see post-investment is lack of trust. If it lacks on either or both sides, that degrades the potential success of the relationship and the company. It’s really important for leaders to realize they and their investors are on the same team. If you work at the company, you should want to grow, and investors are there to help. Everyone wants the same thing - growth.
One of the greatest things leaders can add at this stage is really knowing your business. That’s what investors are learning, and they need your partnership to do that. Showing your understanding not just of products, but of your customers and history is deeply valuable.
At the same time, it’s equally important to be open to investor advice - they have experience you don’t. Combining these two sets of expertise creates a lot of success.
Ultimately, being collaborative, listening on both sides and objective decision making based on the goal are the key ingredients I've seen produce a successful partnership. The investors and the company both need to have the same clear goal and mission. Once we all know what we’re trying to achieve, we can make hard decisions, and sometimes take important risks, based on that and not on what we feel. When everyone buys into that concept, there’s a lot of room for growth.