Zach Hoene

Everything you need to know about the SBA’s 7(a) loan

For more than sixty years, the Small Business Administration has helped American businesses grow. The SBA was slow to adopt programs and policies that could help tech entrepreneurs, but now they fund far more than just mainstreet mom-and-pops—there are several financing options that a yount tech company might find useful.

The most common of these is the standard 7(a) SBA loan. Let’s review how it works and break down the details.

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Four cash management tips for SaaS startups

Cash is king. In business, everything stems from the cash you have, the cash you earn, and the cash you raise. You need it to run every part of your business. How much cash you have determines your company’s runway, and how likely you will raise the next round.

At Lighter Capital, we sometimes see great companies with promising traction, but the entrepreneurs are presented with less than ideal funding options because they didn’t fully understand how to manage their cash. To help you operate better and be in a better position for fundraising, here are four cash management tips we find most useful for tech and SaaS businesses.

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Improving your SaaS company's valuation

If you’re a founder at an early stage SaaS startup, you’re always looking for ways to drive higher and higher valuations, especially as you move from one round of funding to the next. At Lighter Capital, we don’t rely on valuations in our financing model, but I thought it would be useful to talk about valuations as they relate to SaaS companies. We’ll take a look at common valuation techniques and discuss drivers that can help you improve your company’s valuation.

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The pros and cons of transitioning from a service to a product company

It’s a common trend in the software world today: service-based consulting companies transitioning to subscription-based SaaS product companies. Sometimes founders realize that they’re essentially solving the same problem over and over again for their customers and decide to capitalize on that demand by creating a product solution. Other times, founders have a SaaS product in mind from the start, but decide to fund the building and scaling of the product by generating a steady stream of substantial income from consulting.

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Funding checklist: Required documents for securing a traditional SMB bank loan

During my commercial banking days, I would often see entrepreneurs being rejected for a loan because they were unprepared for the underwriting process. Whether you wanted to secure a $100K line of credit or a $2M term loan, if you want it from a traditional bank, you'll have to provide an extensive list of documents in order to go through their underwriting process. It's tedious and time-consuming, but it’s worth it if you can qualify for one. Traditional commercial and SMB loans are definitely the cheapest capital in the market—APRs run between 4% and 8%, typically.

To help you be more successful in securing a loan, We’ve outlined the most common documents banks require. Treat this as your checklist and start preparing for them if you are thinking about getting a SMB loan from the bank.

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Calculating customer churn rate (CCR) for your SaaS business

As a SaaS entrepreneur, there are countless numbers, statistics, and metrics that you need to track and calculate to assess the health of your business, but the sheer number of acronyms can be overwhelming. In this six-part series on key SaaS metrics, we’ll walk you through the most common—and helpful—metrics you need to know to successfully run and grow your SaaS business. 

SaaS businesses rely heavily on gaining and keeping their customers to grow their recurring revenue stream. An important metric when analyzing how effectively you’re keeping your customers happy and coming back each month is the customer churn rate (CCR).

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