10 funding

Fueling the future of product-led revenue – Announcing our $8.5M seed funding

We are thrilled to announce the securing of an $8.5M seed funding round led by Eight Roads, TechAviv, and a select group of angel investors, including company co-founder Ariel Maislos.

This funding will allow us to further develop our platform and grow the team as we work to bring you the best tools for converting your customer usage data into revenue.

Our platform allows you to have complete visibility of where your customers are in their customer journey by analyzing their engagement with your product in real-time. We believe that this technology has the potential to revolutionize the industry and make a real impact on the lives of our customers.

“SaaS companies are in a unique position where they can actually measure the value their users extract from their products. By correlating this information with data coming from CS, sales, and support, we create a customer observability platform, which is crucial to generating sustainable and proactive revenue growth. Securing our funding is a huge step toward our platform’s capability to help businesses succeed in a tough and unpredictable market. Especially when KPIs are now more focused on sales efficiency and NRR. As revenue teams need more product insights, we aim to provide an out-of-the-box solution to a problem which companies tried to solve internally until now.”  

Itamar Falcon, CEO of Coho AI. 

We would like to express our gratitude to all of the investors, customers, and employees that joined us on this journey! 

Stay tuned for more developments in the near future! 

Read the full story as it was shared by TechCrunch.

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Group 10

From Good to Great: How Customer Health Scores Drive Customer Success

As a customer success professional, one of your primary goals is to ensure that your customers are successful in achieving their desired outcomes using your product or service. This requires a proactive approach to identifying and addressing potential issues or challenges that your customers may face. One effective tool for doing this is a customer health score, which is a quantitative measure of a customer’s overall health and success with your product or service.

In this blog post, we will delve into the importance of customer health scores for customer success teams and how they can be used to drive customer success. We will also discuss some best practices for creating and using customer health scores, as well as how they can be integrated into a customer success strategy.

What is a customer health score

A customer health score is a metric that measures the overall health and success of a customer with your product or service. It is typically a numerical score or rating, with a higher score indicating a healthier and more successful customer.

There are various ways to calculate a customer health score, but it typically takes into account a combination of factors such as usage and adoption of the product, customer satisfaction, and any potential risks or issues that the customer may be experiencing. Some customer success teams may also consider other factors such as the customer’s business outcomes or the value they are receiving from the product.

The purpose of a customer health score is to provide a quick and easy way to assess the overall health of a customer, which can help customer success teams prioritize their efforts and identify potential issues or risks before they become major problems.

Why are customer health scores important for Customer Success teams?

While many companies still don’t use customer health metrics, it’s a missed opportunity that could be a significant growth engine. Here are 4 reason why:

Prioritizing efforts

With a customer health score, customer success teams can quickly assess the overall health of their customers and prioritize their efforts accordingly. This allows them to focus their time and resources on the customers who are most in need of assistance or are at the greatest risk of churning.

Identifying potential issues early

A customer health score can help customer success teams identify potential issues or challenges before they become major problems. This allows the team to proactively address these issues and prevent them from escalating.

Driving customer success

By regularly monitoring and improving a customer’s health score, customer success teams can help ensure that the customer is successful in achieving their desired outcomes using the product or service. This can lead to increased customer satisfaction and loyalty, which can ultimately drive revenue and growth for the company.

Providing a common language

Customer health scores provide a common language for customer success teams to use when discussing the overall health and success of their customers. This can help teams communicate more effectively and ensure that everyone is working towards the same goals.

Best practices for creating and using customer health scores

When creating and using customer health scores, it’s important to keep the following best practices in mind:

Choose the right metrics

The metrics that you choose to include in your customer health score should be relevant to your product or service and should accurately reflect the overall health and success of your customers. Be sure to consider a variety of factors such as usage, satisfaction, and potential risks.

Regularly review and update the score

Customer health scores should be regularly reviewed and updated to ensure that they are accurate and relevant. This may involve adding or removing metrics, adjusting the weighting of different metrics, or making other changes as needed.

Involve the customer in the process

When developing and reviewing customer health scores, it’s important to involve the customer in the process. This can help ensure that the metrics chosen are relevant to the customer’s needs and goals and that the customer is aware of their overall health and success.

Use the score as a starting point for improvement

A customer health score is not a static metric – it should be used as a starting point for continuous improvement. Customer success teams should work with customers to identify areas for improvement and develop action plans to address these areas.

Leverage data and analytics

Customer health scores should be based on data and analytics, rather than subjective opinions or assumptions. This helps ensure that the score is objective and accurate and can be used to drive meaningful actions and improvements.

By following these best practices, customer success teams can effectively create and use customer health scores to drive customer success and improve the overall health and success of their customers.

Integrating Customer Health Scores into a Customer Success Strategy

Incorporating customer health scores into your customer success strategy is an important step in driving customer success and ensuring that your customers are achieving their desired outcomes. 

Set up regular check-ins with customers

Customer health scores should be regularly reviewed and discussed with customers. During these check-ins, customer success teams can review the customer’s health score and discuss any potential issues or challenges that the customer may be facing.

Use customer health scores to guide customer success plans

Customer success plans should be tailored to the specific needs and goals of each customer. Customer health scores can be used to guide the development of these plans and to identify areas where the customer may need additional support or resources.

Use customer health scores to drive cross-functional collaboration

Customer success is often a cross-functional effort, involving teams such as sales, marketing, and product development. .Having a single source of truth can be used to drive collaboration across these teams and ensure that everyone is working towards a common goal.

Leverage automation and technology

There is  a variety of technologies available that can help automate the process of tracking and managing customer health scores. These tools can help customer success teams save time and focus on more high-value activities, such as working with customers to address their needs and drive success.

Takeaways 

Customer health scores are a crucial tool for customer success teams as they help prioritize efforts, identify potential issues early, drive customer success, and provide a common language for teams to use. 

By regularly reviewing and updating customer health scores and integrating them into a customer success strategy, CS teams can build stronger, more loyal customer relationships and drive revenue and growth.

Want to know more about how you can incorporate customer health score into your daily work? Contact us!

Group 11

Maximizing B2B SaaS Revenue with NRR: Why It Matters and How to Do It

In times of recession, businesses are more likely to cut costs wherever possible, including by canceling subscriptions to non-essential services. This means that B2B SaaS companies need to focus on retaining their existing customers in order to continue generating revenue. NRR allows companies to track their success in doing so and make any necessary adjustments to their retention strategies.

Winning at revenue growth also relies on revenue retention. Revenue retention will give you the keys to unlocking all other aspects of revenue growth strategy. 

These users prop up all outreach to new customers showing that your brand has a high-level of trustworthiness for long-term relationships. 

Revenue growth can seem like a no-brainer, but when it comes to revenue retention, it can feel like a shot in the dark. So, what is net revenue retention, and why does it matter so much? 

Net revenue retention, abbreviated NRR, is a metric used to boost business growth. 

What is NRR?

Net Retention Rate (NRR) is a key metric for any B2B software as a service (SaaS) company, but it becomes particularly important in times of economic recession. NRR measures the percentage of a company’s existing customers that continue to use and pay for its services from one period to the next.

Industry leaders describe NRR as “net dollar retention.” 

Net dollar, or net revenue retention, the company considers upgrades, downgrades, and customer churn to analyze the business customer base.  

NRR breaks down into monthly segments called monthly revenue retention, or MRR. MRR is a rough estimate of the revenue that comes from your user base each month. 

Why is NRR important?

Experts believe NRR is now more important than ever before. 

With the current economic slump, it is now more important than ever before to retain customer bases. 

Estimates state that a business can deliver 20 percent growth yearly with the existing customer base. 

Growth happens without adding a single new user. Why? Because a stable customer base has expansion opportunities. We’ll talk about that in a minute. First, we’ll define the logic and the math that backs NRR. 

Know what churn looks like 

When factoring NRR, you will also want to look at churn cases. Churn is the rate at which customers end relationships with your brand. 

If a customer cancels a subscription, this may not be the same thing. They may still access your free version of the product, and yet not be paying for a subscription for whatever reason. 

Churn distinguishes between these cases and cases where a customer has broken a connection with your brand forever. 

The math of NRR 

Net Revenue Retention requires some simple math. Use the NRR equation:

 (Contraction MRR – (Churn MRR + Expansion MRR)) / Starting MRR

Alright, so math sucks. Let’s break this down. 

To find your NRR, you will add your growth to your starting MRR. Subtract downgrades and churn from this new MRR. Now divide the new MRR by your starting MRR. Last, multiply the MRR you got from the division by 100%. This final result is your NRR. 

How to use your NRR 

You might be wondering why we put you through the math. Trust us, it’s worth it.

Simmering it down, NRR is the tool we use to gauge business growth potential from our existing user base. These are more than just fancy calculations. We’re solving for where our growth potential is so we can strategize the best ways to influence that growth to happen.

Industry leaders say that a good NRR is going to show growth of over 100%. 

When the NRR passes the 100% mark, we see growth instead of a static revenue retention rate. An NRR of 100% shows that our annual revenue retention, or ARR, has either grown or remained the same.

Ideally, we want the NRR number to be 109%. This shows that we are retaining a good revenue income and also growing by roughly 9%. 

Recognize the room to grow 

While 9% is ideal, we have found that a business can grow by 20% per year by keeping a healthy net revenue retention. 

Using NRR gives us insights into how to upsell our subscription base. 

Because NRR can show us who is already engaging with a paid version of the product, we can use these metrics to estimate who will be open to an upsell. Upselling happens when your current customer base is open to the value offer for a higher-cost subscription. 

Invest time in expansion opportunities 

Remember a little while ago when we said NRR was good for expansion opportunities? We’ll bring it full circle now. Upselling is one of the expansion opportunities we can explore through NRR math. 

KPIs for the upsell 

We need a little bit from our data rather than solving for growth rates. KPIs take over here. Informed KPIs give us the data groups and tools for seeing the value our users are looking for in an upgrade. We sell from there. 

Building the upsell 

Setting data priorities straight empowers the upsell process. As we explore upselling, we work towards expansion revenue goals. Expansion revenue is any revenue that expands from initial customer contact. We call it expansion revenue because we’re exploring an expanding relationship with our customers. 

Upselling is one of two primary expansion catalysts. The second catalyst is cross-selling. Cross-selling introduces customers to new features or add-ons within their existing plans.  

Prevent churn 

Remember that data can alert you to positive growth opportunities, but it can also show you areas where improvement is key. To avoid churns and “drop off,” you need to know your data and streamline the upsell and cross-sell to work naturally with where the customer is in their relationship with you.

 Marketing leaders remind us that no one likes to be “sold to.” A customer with an issue is more likely to have a negative reaction to expansion measures if they feel that their current needs are not being met. However, addressing this is relatively simple. When in doubt, return to your user data flows.    

Know your data 

We talked about KPIs a little while ago. Here is where they get all-important. Without a clear use for data, teams fumble around product management funnels in the dark. 

This is why actionable, AI-led product growth modeling is important. Here we point a laser to the KPI and hone in on data that is essential for reaching those KPI-based goals. 

Make your data work for the customer 

Whether you upsell or cross-sell, make data work for the customer. Boost your pipeline to understand the customer user-experience flow. Then, use this information to work in natural upsell and cross-sell opportunities.  

Coho’s AI-enhanced product-led growth insight tool will notify the team when a customer reaches a milestone. 

Notification helps teams to optimize the flow of selling prompts in a way that flows with the customer journey and needs. Is a customer outgrowing their current subscription? It’s time for an upsell. Is the customer running into a few roadblocks based on the need for one additional feature? Cross-sell to them. 

Coho AI enables personalized selling based on usage insights. 

Takeaways 

Customers are people. Data helps us relate to them in ways that are as diverse as they are. With better insights into the flow of their needs and wants, we can use the NRR to optimal advantage. 

Coho AI believes that product-led revenue growth is people-led revenue growth. AI empowers human interaction in mass numbers in ways that other growth models never could. 

Bottom line: the NRR is vital to underlying our core community of users. By building on this, you will invest in the life and future of not only your product but also your brand community.  In an economy driven by uncertainty and a deep need for connection, this makes daylight to dark difference between you and your competition. 

5 Importance of KPI tracking

Why Seamless KPI Tracking Matters

Key performance indicators, or KPIs, are the metrics that businesses use to see how they are doing and where they are going. Without KPIs, teams struggle to find ways to move forward. That’s why tracking KPIs—the right ones—is mission critical. 

Forbes points out that businesses can waste precious focus on the wrong data. In a list of 16 signs that a team may be tracking KPIs incorrectly, the Forbes Council explained what “wrong data” looks like. The wrong focus happens when the revenue impact or goal for tracking a data set is unclear. The team might start with data they already have on hand, and fail to gather new info relevant to a new direction. 

This is why seamless KPI tracking is essential to growth. With tools that comb through data and hone KPIs, teams can track data sets that make sense for goal-oriented tracking. 

What KPI Tracking Means For Product-Led Growth

Building a “product-led” growth model means building a product that sells itself over time. The Product-led Growth Collective calls “product-led growth” the future of business growth. 

Product-led models focus on the buyer, why they buy your product and the factors that make your product trustworthy and ready to solve the user’s pain points. Boiled down, a product-led growth model focuses on designing a product that is so well made its value speaks for itself in user experience scenarios such as free trials.  

With the product-led market model, seamless KPIs are essential because they give actionable insights into what makes your product relevant to your ideal buyer. 

The right KPIs put product designers on the same path as the buyer’s journey and help you understand where improvement can meet the pain points best. Product-led growth is a design-led commitment to making a product function with ease and efficiency, according to the Product-led Growth Collective. 

How Seamless KPI Tracking Helps Steer Growth Opportunities 

KPIs highlight “key performance indicators”. That information can show the things that make for a positive impact, but it can also show negative things that need improvement, according to Indeed.com. 

Sometimes key performance indicators show problem areas rather than expected outcomes. This data helps teams crack down on areas that need work. 

Seamless KPI tracking that shows the right data in real-time is an asset for steering opportunities. When a team leader sees from the mission-real KPI what areas should be highlighted, they can hone in on opportunities. 

Seamless, Timely, and Relevant KPI Tracking 

Tracking KPIs should include time frame factoring. The KPI information may be interesting, but irrelevant to the near future goal. A seamless KPI tracking system will allow for goals to adjust to their order of current relevance. This means that information that is most important now is ready for the task at hand, while information that will be important for a later target goal is queued according to its need to appear. 

Why Tracking User Behavior Is Key 

When your product is your leading point, focusing on user behavior data is the key point to kickstart customer success. This data lets you walk a mile in your user’s shoes, follow their journey, and understand their needs and wants. With this understanding, a team can orchestrate user journey paths to drive more meaningful product engagement. This self-service path translates into conversions and can reduce churn. 

User Journey Data and Targeting Ideal Customers 

Rather than taking on a bunch of new tools, teams can focus on data and use their toolkit in informed and efficient ways. This is why Coho.ai helps teams optimize their existing tech stack. The Coho system seamlessly integrates existing tools to cut down the time between product insights and Go-To-Market actions. 

Using your current tools data in a timely way, you can reduce the time-to-value of a user’s experience with your product. Analyze how consumers are engaging with and using your product. 

Watching these interactions, you can create workflows in your existing toolkit that target the roadblocks to user paths. By doing this, you are cutting down the work your users have to do to understand the user experience or UX flow. 

Earlier we talked about six steps to optimize your user’s journey. Once user journey paths are identified through data, you’ll need to target your ideal customer. Focus special attention on building client relationships by upselling services to highly engaged users. 

Want to seamlessly track your KPIs? Contact us!

Group 4

4 ways to prioritize the right customers as a customer success manager

Your success in customer success management primarily comes down to your response to one question: How do you best organize your time with customers? This is especially important in the B2B SaaS environment. You are interacting with more people per day than most folks talk to in a week. What’s more, everyone in your client circle expects to be treated like royalty! How do you prioritize? It’s not easy, but here are some guidelines to help.

ARR

The most obvious way to curate your customer base is by size. The customers that are bringing you the highest annual recurring revenue (ARR) certainly merit some sort of priority. If your business revenues rely on term subscription agreements, ARR is a metric to consider highly.

In most cases, your high ARR customers are the ones that are keeping the lights on. These are usually the customers with more choice about partnerships as well. The bottom line: If they are displeased with your services, it means much more to you than to them if a switch gets made. By all rights, you should be intimidated by this. This is a healthy pressure that keeps good businesses honest. However, it does not mean you should prioritize the needs of these customers to the detriment of your smaller clients.

Customers that may provide a smaller overall ARR may also require less maintenance. If you can more easily retain a group of smaller customers, this leaves your business with the manpower and technical resources it needs to grow. In most cases, a good balance between the two groups is the best solution.

Upsell Potential

If your business is like most companies, it doesn’t make the majority of its revenues from initial sales. Customers who upgrade to your premium products and cross sell opportunities are the ones that really matter to your bottom line.

If you are successfully upselling, that means you are keeping your customers happy. Happy customers, along with the ability to maintain their satisfaction, is a skill that not all companies have. If yours does, you must take full advantage of it.

Make sure you are keeping accurate statistics of important client metrics including product use, product use frequency, team size and adoption rate. From here, you can determine where your ARR is coming from more precisely and prioritize your customers based on their potential for future revenues as well as their current account size with you.

Churn Prevention

In general, it is five times more difficult to get a new customer than to retain a current one. With this in mind, churn prevention should be an important metric in the way you prioritize customers. Creating a health score for accounts may help you to prevent churn; otherwise, you may end up wasting valuable resources putting out fires that could have been prevented.

Make sure you are keeping up with the number of customers using your platform within major accounts, as well as the trends you see in use frequency and behavior. Having a snapshot of usage is one thing, but understanding behavioral and use frequency trends over time is much more telling if an account is at risk of churn.

Personal Relationships

The X factor in any business relationship is the personal outreach between client and vendor. People do business with people they like. The tiebreaker between two companies with similar value offerings is often the personal relationship with the client. If you can help it, try to only do business with clients you know will get along with for a long time.

If you spend time cultivating a good personal relationship with clients, they are more likely to receive your upsell correspondence favorably. They are also much more likely to overlook the inevitable small mistakes that your business will make. This runway is especially essential when you are trying to build relationships from the ground up with new clients.

So yes, you may want to consider prioritizing your clients by the “vibe” they give you. As a matter of fact, you should not be afraid to fire a client if that client is demanding priority that he does not deserve. Trying to make everyone happy can only result in less favor being given to the clients you should actually be prioritizing. Great relationships also improve ARR because happy clients are more likely to renew subscriptions and refer others to your business.

Prioritizing your client base can be difficult, but it is an exercise that you must undertake in order to ensure the longevity of your business. Use the tips above as a general guideline to create a short list of clients that most likely deserve priority support. From here, you can begin to evaluate each relationship from a financial and personal perspective, eventually identifying those handful of important clients that you will be moving forward with in the long term.

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Want to learn more about how you can use your product data to identify the best upsell opportunities and prevent churn? Contact us to book your demo!