ToldorSold?

Told or Sold?B2B SaaS companies tell buyers and investors a great commercial story.We find what breaks, what holds, and how it should be selling.

Independent commercial diligence on B2B SaaS, for the buyers and investors behind the deal. Whether the potential is real. Whether the commercial engine works without the founder. What the market says when nobody is preparing the answer. And what a good operator would change from Monday.

What you are told, and what is underneath it

None of these are lies. Most founders believe every one of them, and a good part of each is usually true. They are simply claims that nobody in the process has been asked to evidence.

What SaaS founders told youWhat they really sold you
What SaaS founders told youLogo retention is 95%.
What they really sold youA count of customers kept, not of revenue kept. Where nobody tracks net revenue retention, it commonly lands 20 points lower.
What SaaS founders told youWe have a strong commercial team.
What they really sold youAn org chart, and a founder who still closes the big deals. What matters is how many sellers win above average contract value without the founder on the call, and early on that list is often much shorter than the headcount.
What SaaS founders told youThe pipeline covers the plan 3 times over.
What they really sold youA list of companies that once took a meeting. Coverage counts everything anyone ever entered, and the share carrying a named next step and a date is normally about a quarter.
What SaaS founders told youCustomers love us. Here are 3 references.
What they really sold youThree prepared conversations. The last 5 losses are unrehearsed, and they will tell you which competitor is actually winning, and on what.
What SaaS founders told youThe main risk is execution.
What they really sold youA plan with the hard part left blank: which segment, at which price, through which motion, and what happens to the number if that answer is wrong.

Claims we hear in almost every process, and what sits underneath them once someone looks. These are recurring patterns rather than case studies: the exact number is different in every company, which is the whole reason it has to be tested rather than read.

Everybody checks the numbers. Nobody checks whether it still sells.

Financial diligence confirms the earnings are real. Legal confirms the contracts. Technical diligence confirms the code. Then the commercial case, the one that actually decides whether this was a good purchase, gets answered by reading the management presentation more carefully than the last person did.

In an industrial business you could get away with that. You can count competitors, walk the floor, benchmark cost per unit. In a vertical SaaS company doing a few million in recurring revenue none of that exists. No analyst covers it. The competitive set is fuzzy. Market sizing is top-down and unfalsifiable. And “we are differentiated” cannot be judged by anyone who has never carried a number in enterprise software.

This is not about catching anyone out. Most sellers believe their own story, and a good part of it is usually true. The work is separating the part that holds from the part that was never tested, then saying how the thing should be selling instead.

Four questions, and the evidence behind each answer

Huge market, and we've barely scratched it.

Is the potential real?

The market reachable with this product, this price point and this motion, not the one in the top-down slide. Where growth would actually have to come from, and whether anything in the company today is capable of getting it.

We have a repeatable sales process.

Does the commercial engine work?

Pipeline quality against pipeline size. Win rates by segment, sales cycle, discount discipline, what a renewal really costs to earn. And the question underneath all of them: does this sell without the founder in the room?

Customers love us. Here are 3 references.

What does the market actually say?

Primary interviews: current customers, churned customers, lost deals, ex-sales staff, channel partners. References are prepared. Losses are not, and they tell you considerably more.

The main risk is execution.

How should it be selling instead?

The pricing move, the segment or the motion that changes the trajectory, sized, sequenced and costed. Not a list of risks and a wish for better execution, but the version of this company that a good operator would be running 12 months from now.

Our 4 services, before and after the deal closes

Those 4 questions get answered at 2 moments in a deal. Before you buy or invest, the answers decide whether to proceed and what to negotiate. After the close, they become the plan the company runs. The 4 services below cover both, from a first read taken before you have a seat at the table to a seat on the board once the deal is done.

All 4 services in detail

How the answer gets built

Whichever of the 4 you choose, the answer rests on the same 4 layers, run as deep as access allows. Each one is there because the layer beneath it can be wrong on its own, and none of them decides anything alone.

  1. Reconstruction
  2. Primary evidence
  3. Observation
  4. Judgment

The method in full

Insights

Nobody can state the ROI, so nobody can defend the price

A company that cannot express what its product is worth in the customer's own numbers will discount under pressure, lose renewals it should win, and never raise prices. This is one of the most tractable problems in the first 100 days after an acquisition.

Pricing built before the market changed

Seat-based pricing is no longer the default it was, and among the companies buyers look at in this range it often was not the default to begin with. What matters in diligence is not which model a target uses but whether anyone has examined it since it was set, and what moving it would cost.

The ARR that is not ARR

ARR is a management convention, not an accounting standard, and the convention is set by the seller. Reconstructing the recurring base from billing data rather than accepting the ARR schedule is often the single largest price mover in a software deal.

The cloud bill and the margin

Software margins are under pressure from infrastructure and inference costs, but the pressure is uneven and the industry median has not moved. That gap between the aggregate and the cohort is the thing to examine, because a healthy blended margin can hide accounts that lose money.

All insights