Kellblog covers topics related to starting, leading, and scaling enterprise software startups including company strategy, financing strategy, go-to-market strategy, sales, marketing, positioning, messaging, and metrics
Below I’m cross-posting an article I wrote for the launch of Topline Media, the media spin-out from Pavilion, a popular community for go-to-market (GTM) leaders. This article was originally published by Topline on 10/9/25.
Since this was written for the launch of a new publication, I made it somewhat more sensationalist than usual. It’s also shorter and tighter, without the usual deep-drives and asides.
The reception was not without controversy, in part because I touched the third rail by mentioning 996. Some hastily took that to mean, “some VC is telling portfolio companies to grind 996.” That I’m not a VC and never told everyone to blindly grind 996 seemed beside the point.
What I said was: if you’re in a winner-take-all market, then you need to win. Grinding 996 might be a part of that. But the point isn’t to work hard, it’s to win. You can grind yourself to death at a strategically doomed company and it won’t change much. (I’ve tried that. AMA.)
Here’s the article. Thanks to Sam Jacobs and Asad Zaman for inviting me to write it:
AI has created an era of haves and have-nots. AI-native companies with spectacular growth rates are grabbing all the attention, talent and money. Is this insanity? How long will it last? If you’re not among the ranks of the AI-native high flyers, how do you avoid becoming seen as a zombie, a living-dead SaaS company with uninteresting growth, little profit, and no future?
First, it’s important to understand the external environment. While the world may seem insane, it’s not. We are at the start of a major disruptive cycle on the order of client/server computing or the Internet. Such cycles come maybe every 20 years in my experience, just long enough for us to have forgotten what they feel like.
These technology disruptions create opportunities to build enormously valuable companies that will lead their markets for a generation. This is the system at work. It’s chaotic. It’s inefficient. It feels crazy when you’re in it. But always remember that from the wreckage of Webvan, Pets.com, and a hundred other dot-coms, sprung Amazon, Google, and Salesforce. Nobody said creative destruction came without casualties.
These cycles reflect the nature of venture capital. While fixer-upper private equity (PE) has always been about driving modest growth with ever-increasing EBITDA margins, venture capital (VC) has always been a hits business. I remember nearly a decade ago reading the prospectus of a top-tier fund which said that the internal rate of return (IRR) of their previous fund was 36%, but that dropped to 12% with the top two investments omitted. Most of what makes VC a great investment, worth the 10-12 year illiquidity, comes from a handful of fund-returning companies. While consistent base hits are the PE business model, the VC model is not just about home runs, but grand slams.
Viewed in this light, today’s ARR multiples seem much less insane. After all, if a company is going to be worth $20B at exit, it doesn’t matter much if you bought at a valuation of $50M or $80M. This is what drives the valuation insensitivity and fear-of-missing-out (FOMO) that we see today in AI. Moreover, if you remember that in greenfield platform markets, first place ends up worth 10-100x second place, and second 10-100x third, you should be willing to pay almost anything to get into the leader. And if you’re currently in second place, you should be willing to spend almost anything to get into first. Second prize really is a set of steak knives.
While some will question the durability of high-growth AI revenue, to many investors it’s surprisingly unimportant. Yes, a lot of the $100M in revenues (that a company hit in 18 months) may not recur, but 70% of something is worth a lot more than 100% of nothing. Thus, we are seeing a surprising lack of interest in traditional SaaS metrics and the very notion of ARR — particularly the recurring part — is starting to lose meaning. Increasingly, companies are just talking about revenue or product revenue because today’s pricing models (e.g., consumption, outcomes) no longer align to subscriptions and traditional SaaS metrics.
While we can’t help wondering how long this will last, that’s the wrong question. It will last until it doesn’t. Shorting bubbles is a dangerous business because the market can stay irrational longer than you can stay liquid. Eventually, some trigger will start an unwind cycle. And once again, we will learn that this time wasn’t different from all the times before.
If you’re an AI-native growth company, the strategy is simple: win. Take no prisoners. Grind 996. Grow faster than your competitors, blunt all attempts to overtake you. In the words of Larry Ellison, it’s not enough that you win, all others must lose. Hire people who are so aggressive they make you uncomfortable. Think: “you want me on the wall, you need me on that wall.”
But what if you’re not? Per Jason Lemkin et al., you probably can’t raise new money. Even T2D3 (triple, triple, double, double, double) — a growth trajectory that takes you from $0 to $100M in seven to nine years — is no longer interesting to 80% of VCs. Instead of T2D3, we hear of Q2T3 (quadruple, quadruple, triple, triple, triple). We now measure time to $100M in ARR in months, not years. And, by the way, do it with a tiny team, driving ARR/head of $1M+.
That the bar has been raised so high is a mixed blessing because now there’s no kidding yourself. There’s no pitching a cloud story while still selling on-premises. The bluff factor has been eliminated. If you want to raise money at an AI valuation, then you don’t just need an AI story, you need an AI growth rate to match it. Clear and simple, but far from easy.
If 80% of VCs aren’t interested in talking to you, how might you win over the other 20%?
Hunkering down is not good enough. Particularly if hunker means something like 10% growth and 5% EBITDA at $30M in ARR. Financially, that business might be worth 10-20x FCF, so $15M to $30M. That’s not bad if you’re bootstrapped and you’re a founder who owns 100% of the company. But, even then, that works only if there is confidence that the $1.5M in annual EBITDA will continue. That is, that you won’t be disrupted by AI natives who vibe code your replacement app over the weekend. However, if the same business raised $50M in VC then it’s effectively worthless, because the entire business is worth less than preference stack.
So how do you create value? One word: growth. Growth is what takes you from an EBITDA-based multiple to a revenue-based multiple. Mathematically, a point of growth is worth about 2.3x a point of profit. One way or another you have to figure out growth.
But how?
Make growth at positive FCF the top financial goal. Note that this is not a strategy, but a constraint.
Build an AI story. Do an inside round, raise debt, or even cut traditional R&D if you need to, but you have to find money to build an AI product and story. If you get it right, it will not only enable current sales but increase your value at exit.
Be relentless in sales model optimization. You are fighting for your corporate life. This isn’t about arguing with the board about how much to invest in growth. You are highly constrained, but let those constraints drive creativity. Do market research. Do win/loss analysis. Get good at listening. Figure out what you can do to improve sales productivity. Often, that will be doubling down on a key segment. Or stopping in an unproductive segment. Or changing key assumptions in your sales model (e.g., SC to AE ratio, AE hiring/cost profile) that might have been heretical to consider in the past.
Consolidate the space. Investors who have “no money” for operational experiments often do have money for new strategies. If you’re competing with the usual suspects in every deal and everyone is struggling, then consolidate the space. It should increase both win rates and prices.
Fresh eyes. You might think you’ve tried everything already over the past few years. But have you? And if you tried something and it didn’t work, was that because it was a bad idea or because you didn’t execute it well? Beware false knowledge that blinds you to solutions. Or bring in fresh eyes to challenge your assumptions. Yes, it’s not going to be easy, and yes you’ve tried a lot already, but you need to look at things with fresh eyes to find fresh solutions.
In a world of haves and have-nots, you want to be a have. And the key to doing that, no matter how many times you’ve tried before, is to figure out growth.
I first met Ian Howells in London long ago, as fellow footsoldiers in the early relational database wars. While you had to be pretty technical to do product marketing in those days, Ian was technical with a capital T, having just sprung from university with a PhD in distributed databases. We fought together on the losing side of the database wars [1], shared many of the same scars from the experience, learned many of the same lessons, and — I’m reasonably sure — both decided to aim our careers towards marketing to understand the dark and mysterious magic that was said to have been responsible for our misfortune [2].
I kept in loose touch with Ian over the years as he went to Documentum (content management) [3], SeeBeyond (supply chain), Alfresco (content management), and eventually to Intacct (accounting), later called Sage/Intacct after their subsequent acquisition by Sage.
So when I heard Ian wrote a book on how to use generative AI to improve marketing, I was intrigued. When I learned he was so excited about generative AI’s potential that he took a year off from work to dedicate all his time to the task, I was hooked. Whatever he produced, I was going to read it.
Anyone in B2B marketing with an interest in strategy should read this book.
This book isn’t what I expected. I feared the book might be full of prompts for generating content marketing (aka, AI slop), copy for marketing campaigns, presentations, or infographics.
Instead, Ian has produced an elegant work that teaches B2B marketing strategy while showing how to use generative AI to define and implement it. I’m not 100% sure what I was expecting, but this sure wasn’t it. It’s way, way better.
The book is both theoretical and applied. One page he’s explaining why you should target what I’d call sub-segments (that he calls micro-verticals). Five pages later he’s walking you through the prompts he uses to to build lists of them, right down to their NAICS codes.
On one page he’s talking about the definitions of ideal customer profiles (ICPs) and improved Geoffrey Moore positioning templates. A few pages later he’s got you in the prompts for getting ChatGPT to generate them. One minute he’s talking theoretically about the opportunities created by market discontinuities and, boom, several pages later, he’s back in the prompts showing you how to use ChatGPT to discover them.
What’s even more fun is how he shows what it used to take to do some of these exercises. Like building messaging by doing deep customer interviews, transcribing your notes, printing them, and then spreading them over a conference room for days so you can spot patterns. And then contrasting that to just how fast you can do it today.
This wonderful pattern repeats, through competitive analysis, all-in-one positioning, power messaging, and “wall of sound” campaigns [4]. Each time, the theory and then the ChatGPT practice.
Ian concludes with measurement. That section comes complete with a lesson on the benefits of becoming a market leader (that we both learned from the sting of Oracle’s lash), with lessons quite similar to what I describe in The Market Leader Play.
Congratulations to Ian on writing such a great book and sharing it with us. I’m glad you took the year off to write it! Now, every B2B marketing leader should go read it. Kindle version here.
Notes
[1] It’s not every day you find one of your company’s anti-competitor documents in the Computer History Museum!
[2] The company, by the way, was called Ingres. But since few have heard of Ingres today, I remind people they’ve almost certainly heard of its offspring: Postgres, which stood for Post-Ingres, an open source and extensible version of the system that achieved enormous popularity. I often say that “Postgres is corn” in the sense of The Omnivore’s Dilemma (i.e., it’s in everything) or quip that Postgres is Stonebraker’s revenge. While Larry Ellison made all the money, Stonebraker did win a Turing Award, create several new classes of database systems (e.g., column-oriented), and build Postgres which while ranking fourth on db-engines is generally acknowledged to have a higher market share than Oracle, in part due its open source heritage.
[3] And one of the original case studies in Geoffrey Moore’s classic, Crossing The Chasm.
[4] I’m not capable of typing the words “wall of sound” without referencing the Grateful Dead’s amazing and utterly impractical public address system. What Ian’s describing is what I call a backfire or surround-sound campaign, the goal being the economic buyer at your target can’t stop hearing about you from all sides. Regardless of the name, it’s a great idea, and a much more realistic goal on a limited budget than making “everyone” hear about you (e.g., super bowl ads).
So, you’re on the executive staff of a startup and you’ve been asked to present at an upcoming board meeting. That’s great news. Board exposure is a key benefit of working on the e-staff. You’re getting the chance to build relationships with the venture capitalists and independent directors who sit on your board. These people can help you in many ways, e.g., providing tactical advice, acting more generally as mentors, helping you extend your network, approving your future promotion to a more important position, presenting you with outside board or advisory opportunities, and — when the time comes for it — helping you find your next company.
The board can be a tailwind accelerating your career or a headwind slowing it down. Let’s talk today about how to make a good impression in board meetings and how to start building good relationships with the members of your board.
Here are six tips:
Lose the baggage. If you have authority issues or PTSD from prior board experiences, you need to lose the baggage. That may not be easy — and you may need a therapist to do it — but boards can easily sense passive aggression and inauthentic interactions. I worked with one CRO who viewed board meetings as a necessary evil, something to survive so we can all get back to work. If you feel this way, the odds are the board can tell. (Our board certainly could, and it limited his tenure as a result.)
Make your presentation from scratch. Bad board sessions start with bad slides. Usually, they’re too long and detailed. This typically positions the exec as either “in the weeds” (ergo too junior and in need of an upgrade) or “stonewalling” (i.e., deliberately making an overwhelming deck to stifle conversation). The path to hell begins in the slide sorter, so do not start there. Start with a blank outline to avoid the number one mistake — starting with what you have instead of what the audience needs. Doing so is a false economy and, for chrissake, it’s your board: if anyone deserves a custom presentation, it’s them. So make a custom slides, from scratch.
Cut to the chase. Boards are notoriously impatient. Individual sessions are usually pretty short. There’s no time to warm up with “How ’bout those Yankees?” or several introductory slides, including the tired highlights / lowlights slide. (That slide is appropriate once in a board deck, in the CEO’s update, and if there’s something particularly good or bad in a functional area, it should have already been raised there.) If we’ve had insufficient pipeline for the past two quarters, go immediately to the reasons why and the remediation plan. If you’re not sure what the hot issues are — itself a yellow flag — ask the CEO. Nothing will infuriate a board more than endless warm-up slides that don’t cover the important issues. Beware saying: “Great question, but we’ll get to that on slide 27.” With some boards, you may not still be employed by slide 27.
Make slides that facilitate discussion. Board members like to talk, so let them. Build slides that facilitate a discussion. That usually means first baselining the board with key facts and metrics. (Remember, they might sit on 5 to 10 other boards, so they’re not going to remember everything you talked about last meeting.) Then tee-up a discussion using techniques such as: (i) making a proposal and asking for feedback, (ii) outlining three options (if you really can’t decide) and requesting input on them, or (iii) asking three questions that will help you make the decision. Be authentic. Don’t propose three options if two are patently absurd. This wastes the board’s time and they’ll see through it.
ATFQ (answer the effing question). If, at any time during the meeting, the board asks you a question: answer it. Read this — among the top five Kellblog posts of all time — for advice on how to do so. If asked for your opinion, offer it. Don’t stare at the CEO and then toe the company line. The board is fully aware of the disagree-and-commit principle. They assume you’re committed. They’re asking if you agree.
Ask for relevant follow-up meetings. If you’re the CRO and one of your directors is a former-CRO, ask them for an offline meeting to discuss a hot sales-related topic. While you should spend most of that meeting discussing the advertised topic, you should take a bit of time to get to know each other and start building a relationship. Invite them to a coffee if you can, as opposed to a Zoom. Drive to their office if they invite you.
If you follow this advice, you’ll make a better impression on your board than most and you’ll start to leverage board meetings to set up offline conversations that will hopefully lead to a few career-long and career-changing relationships.
As CJ Gustafson replied when we discussed the idea of building relationships, “oh, you could find a relationship like Scorsese and DiCaprio.” Yes, exactly. That worked out pretty well for both of them.
I’m late with this year’s predictions post because I’ve discovered that writing while recovering from knee surgery, zonked on painkillers, is a surprisingly difficult endeavor. Onward, through the fog. And apologies for the delay.
I’m always humbled by the act of making predictions. A few months ago, I was in London, sipping champagne at the BAFTA, improbably discussing the mast on Mike Lynch’s superyacht. As I talked and sipped, with my mind already in 2025 predictions mode, I couldn’t help but think: I’ve made a few predictions about Lynch in the past, but how could anyone have predicted this?
On that note, let’s begin our eleventh annual Kellblog predictions post. As always, I’ll review my 2024 predictions (with my generous self-scoring) and then make ten predictions for 2025. This is neither business nor investment advice and this content is provided for information and entertainment purposes only. See my FAQ and T&Cs for disclaimers. See note [1] for my policy on political content.
2024 Predictions Review
1. Election dejection. Hit. The election certainly was distracting. The media generally did emphasize “odds, not stakes” in their coverage. My comment about “testing the once-veiled political neutrality of Silicon Valley,” was the understatement of the year with Elon Musk, A16Z, Sam Altman, the All-In Bros, and several others coming out in direct, vocal and fiscal support of Trump. Andreessen’s take was the most interesting, effectively saying they made me do it, accompanied by explanations (some might say rationalizations) to justify their position as self-declared, single-issue voters. In effect, to modernize an old argument, “what’s good for VC is good for America.” In the end, I suppose it shouldn’t be surprising that when the president puts a For Sale sign on access, that some come forward as interested buyers of power.
2. A slow bounce back in startup land. Hit. I correctly called 2024 as a transition year where the Silicon Valley system would purge itself of recent excesses. ARR growth rates continued to get hammered. ARR multiples hovered around historical means, around half of what they were during ZIRP. See these slides from Aventis.
While I was correct that 2024 would be a tough year, I was over optimistic in thinking we’d turn the corner. I now think the bloodletting will continue in 2025. AI will be a huge driver of the rebound, because of both the large VC investment it attracts and its ability to convert headcount budget into software budget (e.g., AI SDRs).
3. The year of efficient growth. Hit. Efficient growth was the watchword in 2024, with companies delivering increases in both profitability and Rule of 40 scores. Again from Aventis:
Rule of 40 scores increased more moderately than profitability, a reflection of companies’ struggles with cracking the code on efficient growth.
Investors did increasingly look at ARR/head as an overall efficiency measure. Bessemer’s new Rule of X gathered momentum as a key SaaS metric because it better accounts for the ~2.2x greater importance of growth over profit in explaining valuation.
4. AI climbs the hype cycle. Hit. While I’m not sure this requires explanation, I’ll share two observations. First, per Pitchbook, AI grabbed 36% of VC deal value in 2024 on its relentless upward march. Frankly, I’m surprised that figure wasn’t more than 50%.
Second, in the enterprise at least, I think Salesforce made the launch of the year by doing what they do best – neatly packaging industry evolution into a simple three-part message and broadcasting it to the world. I’m not talking about technology innovation; I’m talking about the service they perform for the market by widely broadcasting key positioning messages including (a) we are in the agentic era of AI (the previous two being predictive and generative) and (b) it’s safe for enterprises to get into the AI water.
Great marketers remove fear from the equation in new technology adoption. While profit-motivated in the macro, enterprises are risk-averse in the micro because executives literally bet their hard-earned careers on the success or failure of new technology projects. Credible announcements from enterprise leaders do far more to grease the skids of enterprise adoption than the endless, ever-inflating prognostications from Sam Altman, whose views were summarized by one critic as, “we are now confident that we can spin bullshit at unprecedented levels, and get away with it.”
5. AI-driven GTM efficiency. Hit. There has certainly been an explosion in AI-powered, go-to-market tools from startups. Mega-vendors, keenly aware of the deadly potential of disruptive technology, have not been caught flatfooted, either. (That’s the often-ignored, second-order effect of everyone now having read The Innovator’s Dilemma.) While I don’t think we have yet captured Battery’s 30% increased efficiency target, I believe we will in 2025, particularly for more mature SaaS businesses. New and AI-driven SaaS businesses will likely be investing so much in growth that it will be hard to see those same-store sales productivity increases when they are mixed with the large investments in new capacity (which is a fundamental limitation of the CAC ratio as a growth efficiency metric). But, overall, I think we are well on the way to achieving the GTM productivity improvements promised by AI GTM tools. Keep investing in them and experimenting with them. What’s a competitive advantage one day is often table stakes the next.
6. Beyond search. Hit. To paraphrase REM, it’s the end of the (Internet search) world as we know it. This MIT Technology Review article does a great job of explaining the evolution of search and how conversational interfaces are replacing the search box and generated answers replacing lists of links. This will have a profound impact on businesses that rely on Internet search for traffic, leads, and customers, from publishers to e-commerce providers. And it will impact any business that relies on digital marketing, such as paid search, SEO, or content marketing. So, basically everyone.
Marketers should understand these impacts and get ready for a future of zero-click marketing. While HubSpot’s SEO crash recently made headlines, I agree with Kyle Poyar that they’ve adequately hedged themselves against this. The question is, of course, have you? Lest all this sound too scary, I offer this excerpt from Rand Fishkin.
I believe that this is not an apocalypse for digital marketers.
These are important things that we need to consider, and we need to, as a result, invest in zero click kinds of marketing and change our entire thought process around what we’re doing online with digital marketing. But influence has always been better than traffic. Traffic was always a vanity metric. I love my friend Wil Reynolds who posted this video about showing how their traffic, Seer’s traffic, his company’s traffic had dropped 40%, and it seemed like the end of the world, but sales were up 20% because traffic is not the same as conversions. Traffic is not the same as customers. Traffic isn’t even the same as fans.
So, like REM, I feel fine.
7. From RAGs to riches. Hit. I like RAG because it’s a practical approach that solves or mitigates key problems with LLMs (e.g., hallucinations, explainability, sourcing), all while leveraging their tremendous power. In 2024, I think RAG established itself as a cornerstone technology for enterprise AI. These twoposts provide a detailed review of RAG’s progress in 2024. Menlo’s The State of Generative AI in the Enterprise report shows RAG as the dominant and fastest-growing design pattern in enterprise AI.
8. Outbound finds its proper place. Hit. I think that companies, assisted by the rapid adoption of AI SDRs (e.g., Piper), are increasingly figuring out some key truths about SDRs.
Inbound SDRs are an extension of marketing and, due to their fairly rote work, are increasingly being replaced by AI SDRs.
Outbound SDRs are an extension of sales and, due to their relatively complex work, are not easily replaceable by AI SDRs.
Unfocused outbound is generally an unproductive activity. You are better off investing in inbound and partners if you don’t have defined, high-value targets.
Outbound SDRs are best used as part of targeted account programs, such as ABM, aimed at high-value customers. Think: is the juice worth the squeeze?
9. The reprise of repricing. Partial hit. The best data I’ve found here is in a report from Carta, which suggests that I was a year late: option repricing appears to have peaked in 2023. That said, this chart contains only one quarter of 2024 data. The 2H24 version of this report should be out soon, so we’ll know more in a few weeks. Either way, if your company is still digging out from valuation overhang, it’s never too late to consider repricing. Look at last year’s predictions post for more.
10. Peak podcasting. Miss. Podcasts continued their upward march in 2024. While I’d argued that podcasts would peak in 2024, both market forecasts and industry trends suggest that podcasts will continue to grow in the years to come. The demise of Internet search and the associated need for companies to build their own first-party audiences will drive podcasts to grow in importance. While I’d written that 2024 might be the last good year to start a business podcast, I think 2025 will be a good one as well. So, if you don’t have a business podcast yet, think about starting one. Just make sure you produce good content.
Kellblog Predictions for 2025
1. America gets what we deserve. We voted for it, both via the electoral college and the popular vote, so we’re going to deserve what we get. That will include:
A more brazen, more conflicted, and less constrained Trump. In short, we’ll see “Trump, Unbridled.” The unlikely bedfellows that elected him will discover exactly what they ordered and exactly who the administration is going to serve. Trump will face less resistance on both the internal front (i.e., intra-party, intra-staff) and external front (i.e. Democratic). Decreased internal resistance will result from fealty-based screening and fear-based leadership, making quick examples of those who step out of line. Decreased external resistance will come from a mix of advance obeying, a sense of futility, and continuous (if incorrect) mandate rhetoric. If the Democrats brought knives to a gunfight last term, this time they’re bringing cupcakes.
A more divided country. I’d initially thought the more brazen approach would result in buyer’s remorse, but I now think it’s more likely to result in increased division, with supporters doubling down in response to each fresh outrage. Aided by a more fearful and less hostile media, Trump’s apologists may need to contort to new degrees, but they will invariably support virtually anything he says or does. Thus, the country’s divide will widen, with one side believing that we’re making the tough decisions needed to restore America’s greatness and the other thinking we’re destroying many of the things that made America great in the first place.
A more distracted country. I think of the government like plumbers. I have little interest in what they do and how they do it. I don’t view plumbing as a spectator sport. I just want things to work. But we have now signed up for four more years of stunts, boasts, bluffs, brags, parade jumping (e.g., Stargate), hyperbole, constitutional crises, and trial balloons. Trump is a master at centering attention on himself, has turned shamelessness into a superpower, and paralyzed the traditional media in the process. I’ve always been surprised that we haven’t seen clear opportunity costs associated with all this distraction. In 2025, I think we will.
Get used to hearing “unprecedented” a lot. It, as was once said, will be wild.
2. The broligarchs enjoy their 15 minutes of fame. For some, the agenda was preemptive defense. For others, a desire to deregulate AI, crypto, or big tech M&A. For a few, a chance to grab power and live in the spotlight. For many, the ideological pursuit of sci-fi-inspired visions.
We know who the broligarchs are and why they’re here. A surprising number hail from the PayPal mafia. We know that they’ll all get their 15 minutes of fame. The big question is how long will they last?
Given Trump’s mercurial personality, the revolving door of “best people” in Trump’s inner circle, the sizes of the various egos, and the fact that the broligarchs are all much smarter than Trump, I think the general answer will be: not long.
For every person who hangs on, I think we’ll generate several Rex Tillersons who don’t. As a reminder, while his “fucking moron” quote was never publicly confirmed, here’s what Tillerson did say about his experience:
“It was challenging for me,” he said, “coming from the disciplined, highly process-oriented Exxon Mobil corporation, to go to work for a man who is pretty undisciplined, doesn’t like to read, doesn’t read briefing reports, doesn’t like to get into the details of a lot of things, but rather just kind of says, ‘This is what I believe.’ ”
It won’t be easy for the data-driven tech bros to handle such arbitrary decision-making. But to steal a line from Airplane: “they bought their tickets, they knew what they were getting into. I say let ‘em crash.”
I think the odds of any given individual hanging on will be an inverse function of their desire for power. The more they’re conducting business as usual and simply looking out for their firm’s or industry’s interests (e.g., Cook, Bezos), the longer they should be around. The more they’re trying to work in the inner circle (e.g., Musk, Sacks, Ramaswamy), the shorter.
Heck, Ramaswamy couldn’t even last one Scaramucci before getting blown out. While Musk’s $270M may have bought himself a longer tenure, featuring multiple lives, we’ll see how many times he gets to embarrass Trump before being blown out himself.
3. The startup ecosystem purge continues. As mentioned above, I think the cleanse that started in 2024 will continue into 2025. In many ways, startup investing is like playing craps. You play for a long time, accumulate bets on the table, and either win slowly as different bets pay off at different times – or lose a lot all at once when the shooter rolls a seven. Personally, I’ve never had more angel investments sell, cease operations, or return money than I have had in the past 12 months. There are two opposing forces in play: cash reserves and exit multiples. I think that many startups have strategically decided to sell, but don’t want to start a process in what’s clearly a buyer’s market. Look at these feeble M&A-specific exit multiples from Aventis:
Thus, many startups are tightly managing their cash reserves to buy time and hopefully sell into a better market. I believe that as multiples start to bounce back many of those in waiting will be able to achieve their exits.
4. Attention is the new oil. In 2006, Clive Humby, coined the phrase “data is the new oil,” to suggest that data would power the information economy in much the same way as petroleum powered the industrial economy. Today, I think we can replace “data” with “attention.” In his upcoming book, The Sirens’ Call, Chris Hayes argues that every single aspect of human life is being reoriented around the pursuit of attention. Attention is a kind of resource, he argues, it has value, and if you can seize it, you seize that value.
This harkens back to Jeff Hammerbacher’s 2011 quote, “the best minds of my generation are thinking about how to make people click ads.” Today, you might update that with “click anything,” as best demonstrated by the bizarre game Stimulation Clicker, which ends up part game, part real-life reenactment, and part parable.
We are moving, Hayes argues, from the information age to the attention age. The masters of attention, such as Trump and Musk, already understand this and are leveraging it to their advantage. The rest of us need to learn how to play the game, both on offense and defense. I think that will accelerate in 2025.
5. The world wide web, as we knew it, is dead. Born: 1989. Died: 2024. The original web vision was for an open, world wide network of hyperlinked content, freely accessible to all.
That worked until the information wants to be free crowd got (rightfully) squashed by paywalls to protect creators. Then Web 2.0 came along, creating a read/write web, with user-generated content, so that individuals could not just read, but publish and share content without requiring any technical skills. The mobile explosion extended connectivity but undermined the vision as applications and app stores (with their heavy platform fees) replaced web browsing and websites – resulting in oddities such as the inability to buy an e-book in the iPhone Kindle application.
In recent years, platform providers (e.g., Twitter, LinkedIn) declared war on the hyperlink, unapologetically downranking content that included links beyond their walled gardens. Google’s ever more ambitious front-running (e.g., featured snippets, AI-generated answers) provided the final nail in the coffin, decimating search traffic, and replacing it with the zero-click search.
When was the last time you saw an in-line hyperlink, particularly on a corporate website? Why are newsletters and Substack replacing blogs and WordPress? Why do people bury links in comments and replies? Why can’t WordPress auto-post to Twitter? Why did Seatguru stop updating its content years ago? Why are sites like SlideShare so ad-laden as to become unusable? Why, when I have 20K+ followers, do I have posts that get only 500 views? In a world with algorithm-driven feeds, what does “follow” even mean anymore?
These are the death throes of the world wide web. Why must platforms invariably undergo enshittification? It’s the tragedy of the commons all over again.
While web 3.0 and a Read/Write/Own paradigm is theoretically coming to save us, I’m not holding out much hope. As interesting as some of those ideas are, Web 3.0 strikes me as too much of a hodgepodge of agendas and ideas. I think the current web 3.0 (which is actually web 3.0 v2) has roughly the same odds of success as its predecessor, web 3.0 v1, aka, the semantic web.
So, for now, I think we’ll remain stuck in the Hotel California era of the web: you can check out any time you like, but you can never leave.
6. Working for the algo. You hear a lot of concerns about AI replacing jobs. But I’m also concerned about something else: about us working for algorithms as opposed to algorithms working for us.
Then congratulations. You’re not working for the man. You’re working for the algo.
CAPTCHA is my favorite perverse example because you have a human trying to prove to a computer that they’re human. Or 2FA, where you have a human trying to prove to a computer that they are who they say you are. Ponder that for a second.
In 2025, I think we’ll increasingly be working for the algo. When I’m performing transactional tasks, I already feel like I’m spending as much time on CAPTCHA and 2FA as on the tasks themselves. And I definitely dislike the menial work I do to tune my content for maximum reach.
Working for the algo isn’t necessarily bad. But it does pose a lot of questions about who is making or tuning it. Bluesky’s custom feeds are one approach to solving one of the many problems here. Passkeys help with security. I’m sure we’ll see other solutions arise as well.
7. The death of SaaS is greatly exaggerated. Satya Nadella made headlines with a three-minute commentary during a recent BG2 podcast appearance which many translated to: SaaS is Dead!
While this is a somewhat fashionable thing to say these days, let’s first look at what Satya actually said:
“Yeah, I mean, it’s a very, very, very important question, the SaaS applications, or biz apps. So let me just speak of our own Dynamics. The approach at least we’re taking is, I think, the notion that business applications exist, that’s probably where they’ll all collapse, right in the agent era, because if you think about it, right, they are essentially CRUD databases with a bunch of business logic. The business logic is all going to these agents, and these agents are going to be multi-repo CRUD, right? So they’re not going to discriminate between what the back end is. They’re going to update multiple databases, and all the logic will be in the AI tier, so to speak. And once the AI tier becomes the place where all the logic is, then people will start replacing the backends, right?”
Translating the surprising amount of technobabble, he’s making an old-age argument that a business application is “just” a UI tied to a database with some business logic, the implication being: how hard can that be? Workday’s $70B, Salesforce’s $330B, and SAP’s $330B market caps all say “pretty hard” to me. Or, if not technically “hard” per se, that there’s nevertheless a lot of value in tying those things together.
Satya builds upon this to say that the business logic can now be handled by agents, again a repackaged argument that once was made about rules engines, business process automation, and low-code development tools and one that trivializes the domain expertise built into business applications. I think the quote says more about Microsoft and their worldview than it does about the future of business applications.
To bring some data to bear here, I found this interesting chart in this excellent deck from Aventis, which asks companies what inning SaaS adoption is in at their firms.
I think the best short answer I’ve seen to this question comes from Jason Lemkin:
To paraphrase Mark Twain, reports of the death of SaaS have been greatly exaggerated.
8. An unlikely revival of branding. In an era of efficient growth and highly scrutinized marketing budgets, it’s surprising to predict a revival of branding. But I think one’s coming because I’m increasingly hearing statements like:
We’ve spent the past two years optimizing pipeline generation efficiency.
Now we need to focus on winning more deals.
SaaS products are increasingly lost in a “sea of sameness,” and we are thus unable to differentiate at a product level.
Branding is therefore the last bastion of differentiation
So, we need to win deals based not on product superiority, but on brand value and experience.
In short, since we can’t differentiate our product, we need to differentiate our company.
I have two problems with this logic:
As someone raised in product marketing: you can always differentiate your product. If you can’t, it’s time to turn in your marketing badge and gun.
As someone with a child who works in CPG: if my daughter can differentiate fermented milk (i.e., yogurt), then we should darn well be able to differentiate a complicated piece of enterprise software.
But I do understand how a demandgen-oriented CMO – as most are these days – could get caught up in this logic. So, before you embark on a branding program, ask yourself three questions:
Are you sure you can’t increase your win rate the old-fashioned way — through product marketing and market research (e.g., win/loss analysis, sales enablement, sales training)?
Are you guilty of Law of the Hammer bias? Is branding the right solution, or are you simply more comfortable working on branding than product marketing?
Do you have the time and money required to complete a successful branding program? Will your tenure as CMO be long enough to see the fruits of your labor, or will your successor send you a posthumous medal of honor for your contribution?
Whether done for the right or the wrong reasons, I think we’ll see a revival of branding campaigns in 2025. If you’re doing one, make sure you’re in the first group, by ensuring that you’ve exhausted product marketing solutions to the problem.
9. PR is the new SEO. It turns out that one of the best ways to optimize inclusion in ChatGPT results is, per Rand Fishkin, “getting your brand mentioned alongside the right words and phrases in authoritative media.
In other words: PR.
Here’s a link to Rand’s five-minute explainer video.
I guess that if you live long enough, everything comes full circle. This is good news for marketing teams that kept an active PR function and agency during the dark times. It’s bad news for those who turned off PR and will now need to restart from scratch.
There are numerous techniques that marketers must learn to build their LLM optimization skills while still running traditional SEO programs in 2025. Here are a few of the better articles I’ve read on the topic.
Emily Kramer’s post summarizing an interview with Flow Agency
10. LinkedIn enters the social media death cycle. LinkedIn is at a fork in the road. With users fleeing other social networks (e.g., Twitter, Facebook) and trolls, bot-nets, and the like wanting to increase their reach, there is an increasing amount of non-work content on LinkedIn. For example, jokes, memes, snark, and political content. And that’s not to mention the gray zone content where business leaders are making political commentary.
This trend has not gone unnoticed by users, and I think they generally don’t like it.
LinkedIn can go down the usual path to enshittification, relying on engagement as their North Star metric. Because this content is highly engaging, the engagement scores are through the roof: look at the numbers in this screen clip.
The problem is, of course, by allowing and amplifying this highly engaging content, you get more engagement, right up until the point your site becomes a hellscape and nobody wants to use it anymore (e.g., X). Then the hapless platform provider finds that network effects also work in reverse: the more your friends stop using a site, the less incentive you have to go there.
Or they can make the tough decision and focus on their original vision, purpose, and positioning: a social network for work. While they have taken modest steps, such as a feed preference to turn off political content, the features simply don’t work. If they want to preserve their status as the social network for work, they’ll have to do much, much more. And that’s not to mention getting core work social network functionality, such as job seeking, to work properly.
While I think they’re a smart organization, the sirens’ calls of engagement are strong. I’m predicting that in 2025 they only take half-hearted measures to preserve their positioning and thus enter the social media death cycle. Some would argue they’re already in it.
Thank you for reading all the way through. I hope you’ve enjoyed this post, and I wish you a happy and healthy 2025.
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Notes
[1] As described in my FAQ, I generally avoid political content on Kellblog unless I’m using politics to illustrate strategy and messaging. My annual predictions post is an exception because I like to start at the macro level and, particularly in recent times, that will likely involve some intersection of business and politics. Instead of attempting the impossible (i.e., pretending to be neutral), I will allow my views to leak out in the process but, rest assured, I’m not trying to change your mind about anything. Note that I’ll delete comments that try to engage in political conversation as opposed to comments about the predictions themselves. If you are interested in my broader views, you can follow me on Bluesky where I post on a broad range of topics (largely just sharing and commenting on what I read) including SaaS, VC, Silicon Valley, strategy, politics, current affairs, France, the Grateful Dead, databases, humor, and others.
It’s always fun to go back and look at my stats, and my best-of page (which amazingly came in at #11) is getting sufficiently long that I need to find additional summarization mechanisms.
So this year, I thought I’d share the top-ten Kellblog posts of 2024 (year to date) regardless of the year in which they were written.
Kellblog predictions for 2024. My tenth annual predictions post topped the list. I’m already working on my 2025 predictions which I hope to publish before the end of December.
Simplifiers go far, complexifiers get stuck. This classic from 2015 starts with a poignant joke. Question: What does a complexifier call a simplifier? Answer: Boss. Learn why by reading it.
I’m Dave Kellogg, advisor, director, blogger, and podcaster. I am an EIR at Balderton Capital and principal of my own eponymous consulting business.
I bring an uncommon perspective to enterprise software, having more than ten years’ experience in each of the CEO, CMO, and independent director roles in companies from zero to over $1B in revenues.
From 2012 to 2018, I was CEO of Host Analytics, where we quintupled ARR while halving customer acquisition costs, ultimately selling the company in a private equity transaction.
Previously, I was SVP/GM of the $500M Service Cloud business at Salesforce; CEO of MarkLogic, which we grew from zero to $80M over six years; and CMO at Business Objects for nearly a decade as we grew from $30M to over $1B in revenues.
I love disruptive startups and and have had the pleasure of working in varied capacities with companies including Bluecore, FloQast, Gainsight, Hex, Logikcull, MongoDB, Pigment, Recorded Future, Tableau, and Unaric.
I currently serve on the boards of Cyber Guru, Scoro, TechWolf, Vic.ai, and Widewail. I have previously served on the boards of Alation, Aster Data, Granular, Nuxeo, Profisee, and SMA Technologies.
