Building the Next Generation of B2B Startups

Another B2B startup example, that many consider the start of the SaaS model, is Salesforce. Companies will pay them a subscription to track their sales efforts.

In contrast, B2C startups, or business-to-consumer startups, are when a business sells directly to customers rather than to other companies. Overall, B2C tends to be based on individuals' preferences, on shorter-term relationships, and have lower purchasing volume than B2B. One example of a B2C company is Amazon, which  sells products on their online marketplace to individual consumers rather than an entire company. 

B2B SaaS Startups

As a B2B SaaS startup, finding the right pricing strategy for your SaaS business is essential to hit your business goals. It’s important to figure out what’s fair and allows you to grow at the right trajectory. Out of the many SaaS startups founded in 2021, none look the same. In fact, all of them likely adopt different SaaS pricing strategies for their product. According to G2 Crowd, here are a few B2B Startup Models to consider: 

• Flat-rate pricing 
• Freemium model pricing 
• Tiered pricing 
• Per feature pricing 
• Per user pricing (active)
• Usage-based pricing

If you choose the right pricing model and grow quickly, you’ll be well on your way to making lists like “the best b2b saas startups”, “the fastest growing tech startups 2021”,  and “the most successful saas startups 2021”. Remember, SaaS pricing or the business model you choose for your B2B SaaS startup isn’t a “one and done” project. The most profitable b2b businesses are willing to adapt and adjust as their startup changes, their customers’ needs change, and revenue starts to grow. 

The Stages of SaaS Startup Growth

SaaS companies grow in stages. The early stage when the idea turns into a product is the startup stage. The next stage is hyper-growth; the product gets adopted by customers, and investors want to be confident their investments will build a company large enough to be acquired by a larger business or sell shares on a public stock exchange.

Most Profitable B2B Businesses

When SaaS startup ideas transform into a startup business, profit is often ignored to focus on growth. However, once the company reaches a level of stability, profitability becomes the most critical measurement of success. To achieve profitability, the SaaS startup ideas need to develop into repeatable processes to reduce costs and maximize profits. Since development and engineering are a large segment of the budget, automation, artificial intelligence and offshore resources are essential solutions for keeping costs down. Avoiding customer churn is also vital for maximizing profitability. Retaining customers is more profitable than finding new business, so developing new features and products to keep customers engaged leads to greater profits over time. 

Top SaaS companies in 2021 are profitable because they continue to innovate and develop product features that are better and more cost-effective for their clients.

Innovative Business Ideas 

At High Alpha, we believe that the most innovative business ideas often come out of massive industry changes. In fact, as a venture studio we like to monitor B2B startup industry shifts to find unique business ideas to start new and turn into innovative B2S startups. There are many trends to be on the lookout for in the B2B startup space to uncover saas startups ideas,including hybrid work, climate change tech, and security/privacy concerns. Below we will outline some industry trends we care about and have used to uncover great B2B software ideas and turn them into the top saas companies of 2021: 

Hybrid-Work and Remote Environments

The global COVID-19 pandemic has, in many ways, changed not only the B2B startup landscape but the way many businesses operate as a whole. Many call this trend “the future of work”. This shift to a more hybrid work environment opens up many possibilities for startups to dive in and solve some of the challenges companies face working from wherever. Some of our studio companies are solving problems associated with hybrid-work, including: Luma, Docket, and Filo. 

Climate Change Technology

Another startup trend that is prevalent today is tied to climate change. Many companies have seen an increase in accommodating green-minded employees, stakeholders, and customers. In recent years, venture capitalists have also been focusing on SaaS companies that are paving the way for a more green future. Companies are looking for a way to reduce their carbon footprint and actively do good for the environment. 

High Alpha Capital has invested in Climate Tech, including Encamp, environmental compliance software, and Rheaply, resource management software. In addition to our investment efforts, we are also evangelizing how technology can address climate change through our marketing and events. On Wednesday, April 14th, 2021, Jason Jacobs joined High Alpha Partner Mike Fitzgerald for a virtual fireside chat about founding Runkeeper and his quest to address Climate Change with his unique skill set as a long-time software entrepreneur.

Data Security & Privacy 

As technology continues to innovate and more secure, personal information moves online, there is a growing concern regarding data privacy that parallels an increase in the general mistrust of companies. Dozens of companies hold vast amounts of valuable information about people so more are asking where it's going and what they are using it for. It is becoming increasingly crucial for B2B startups and companies to address privacy concerns to ease the minds of skeptical individuals. Trava, a High Alpha Studio company, is an example of an innovative SaaS company that is simplifying cyber risk management for business owners and IT professionals.

While this list is not exhaustive, we think it’s a good starting point when evaluating trends that lead to innovation. As a venture studio, our goal is to create companies that are solving tough problems in innovative ways. 

Most Innovative Tech Startups

Because we also make investments in innovative startups, we are constantly looking for the best startups in the world to invest in, but we’re not the only ones. When you simply Google terms like, “top saas companies 2021”, “top saas startups 2021”, “best startups 2021”, and “top b2b startups”, you’ll find hundreds of lists of companies creating interesting products. 

While it’s not an exhaustive b2b companies list, below are a few examples of the most innovative tech startups:

Slack

Slack came into the market as an internal tool for companies. It launched in 2013 and has grown substantially in the past eight years. It is a collaboration tool that acts as an additional communication tool to the more traditional email. It weaves in chat to the business world and has become an increasingly popular service throughout the shift to more hybrid work. 

G2 Crowd

Started in May of 2012 by former BigMachines employees, G2 Crowd is a peer-to-peer review site headquartered in Chicago, Illinois. It was originally known as G2 Labs, Inc. until 2013. Most recently, the company raised another $55 million in growth funding to continue expanding its business. High Alpha was an early investor in G2 Crowd, and we’re proud to be a part of the company’s story.

Snowflake Computing 

Snowflake had one of the largest software IPOs in recent history. Their primary service is allowing businesses to store and analyze critical information in an efficient way. They have been actively growing their business and continue to be one of the best data warehousing software on the market. 

Terminus

Terminus, a High Alpha portfolio company, is an Account-Based Marketing platform built for sales and marketing teams who care more about generating revenue than generating leads. Founded in 2014, Terminus is the industry's first ABM platform that enables B2B marketers to target companies, engage decision-makers on their terms, and accelerate sales pipeline velocity at scale.

Lessonly

Lessonly, a High Alpha Studio Company, is training, enablement, and coaching software that captures internal knowledge, best practices, and team policies as searchable — and assignable — step-by-step lessons. Their ultimate mission is to help people do better work so they can live better lives. In 2013, Max Yoder, Kristian Andersen, Mike Fitzgerald, and Eric Tobias sat down to work through the first Lessonly wireframes. By 2016, Lessonly had officially crossed the 500,000 “learners” mark and was redefining the corporate training and LMS industry with their learner-first approach.

Casted

Casted, a High Alpha Studio company,  an audio and video content marketing solution for enterprise brands. Marketers use the Casted platform to host, organize, distribute, and measure the performance of their branded podcast shows and episodes. Casted’s growing list of customers already includes notable brands like Drift, Pendo, Terminus, and LogicGate. 

With many ongoing changes in the market that often can be unpredictable, the future of B2B startups is promising with the large amounts of innovation occurring in the spac