Issue #32 - An ecosystem where behaviour is improving
In This Issue: Vile Rumour & Gossip | Ecosystem upgrades | Shrinking the stack whilst it also fragments
Welcome to winter. Let’s hope it’s cold enough for the apparel brands to sell through but not too wet! In this issue, you’ll find commentary about ecosystem evolution, VC insight, and (just because we’re always planning events so far ahead) some 2025 thinking.
Our intention in this regular newsletter is to inject a little truth (and spice) into the merry-go-round of SaaS, informed by the voice of the customer, and interpreted through our own independent lens.
Vile Rumour & Gossip
Going bust whilst being profitable?
There’s a huge variance in rumours about the financial health of vendors at the moment. One from last week sticks in our minds. From one source, we’re told a particular vendor has had its “emergency funding” declined by the VC. But in the same breath, a customer said that the same vendor was/is profitable!
We’d counsel two things: a little prudence in repeating the rumours and some due diligence when signing new vendor contracts.
Valuation merry-go-round
Our insight into the VC world is negligible, no doubt. But we did have a very interesting set of conversations with founders this month, from FMCG scaleups through to SaaS looking for their last “venture” round (as opposed to growth).
Across 5 conversations, the sentiment is clear: VCs are not looking to help with growth. Instead, they’re hunting deals. It’s not hard to imagine their internal dialogues…
“Are you a frustrated founder, bored of waiting for the right valuation? Great - here’s your lowball offer. Oh, you have a great value proposition but only a few paying customers? That’s a growth investment - have a lowball offer.”
There are no more rocketships - yet.
Ecosystem upgrades
When we launched Commerce Futures 10+ years ago, the relationships we saw between vendors, agencies and others were…brittle, to say the least. The word “partner” was a convenience, and these relationships broke down quickly, built as they were on the foundations of beer and golf.
Today, we see these slightly adversarial partnerships much less often. MACH has definitely had an influence; its structure has forced everyone to up their game, play nicely with competitors, and think about the customer more often. Equally, the fragmentation and resulting overlap between solutions have made everyone a “frienemy”, which means you never know who you might see a sales lead from.
Why is this important?
Customers see these changes. If they continue, the world of SDR heavyweight approaches and “lead gen” marketing will change, and a new creative-driven approach may emerge. Think about it: technology sold based on accurate and compelling information, and delivered consistently by peers. Wouldn’t that be amazing?
Shrinking the tech stack (while it fragments)
An unpopular topic for vendors, I’m afraid. Customers are starting to make a concerted effort to rationalise their stacks. As SaaS fragments, it’s easy for any digital stack to comprise up to 30 vendors, and while new solutions for things like content automation will no doubt be adopted, many are starting to turn solutions off. Mostly by combining vendors.
Subscription and loyalty are obvious places to combo up. The solutions are still a bit poky, but the data exposed makes this a meaningful place to explore. Equally, Shopify always signals where it feels there is an opportunity to make inroads, and its tax service may weaken vendors like Avalara and others as customers adopt it.
Hopefully, the ecosystems will continue to behave well as this trend continues. But we’re not so confident!
Finally, a note on our new secret blog - we call them “The Stigs”. For a while now, a number of customers have asked to write “anonymous” blogs as part of our truth-saying newsletter vibe. We love that!
This month, we have the first. And each month hereafter, a new writer (always a real customer with something to get off their chest) will throw their hat in the ring with their heart on their sleeve. Their identity will always be a secret, and we’ll rotate so nobody will ever guess, of course.
Read: Offline Mode - Why You’re Kidding Yourself That You’re Omnichannel. Onwards!
Buyingtime Dictionary
Frequently used (but never about you) phrases from Buyingtime Ltd.
Morphine
/"mºrphinə/
noun
1. a slow acting dope
"Tell Norman not to rush that report anymore.
The client died of old age."
"Norman? Oh, you mean Morphine. Yeah, his work is slow, but at least there's not much of it."
