Dear Reader,
Welcome to the 43rd edition of the good reads newsletter by Malpani Ventures. Sharing your weekly dose of articles for this weekend’s reading!
A Tale of Two Companies: The Professional Services Paradox
https://kellblog.com/2023/02/06/a-tale-of-two-companies-the-professional-services-paradox/
SAAS plus Services vs Software only is a conundrum for most investors. Dave Kellogg wrote an amazing post on this. Quick before you read: As an investor, which company do you back?
A Sane View of Indian Venture – January 2023
Checkout this monthly round-up of the Indian venture capital ecosystem by me !
Some key stats:
35 companies raised Series A to D rounds in January. Of these, a third cos (~30%) actually raised extension rounds. These usually involve the infusion of additional funding from existing or new investors typically at the same valuation as the previous financing round.
2023 promises to be a sobering year for the startup ecosystem both in India and abroad. However, it is worthwhile to remember, that Indian tech startups continue to pull in more than a billion dollars monthly despite the global slowdown – this number is broadly in line with funding received both in 2019 ($ 15 Bn) and 2020 ($11 Bn). There is enough and more cash to build real businesses!
Value punks
Siddharth shares his thoughts on value-investing:
Value investing has evolved over time. Earlier it was buying a dollar for 50 cents. Now people buying high-growth tech stocks is also value investing. A stock growing at 50% a year and at 10-20x earnings is also value investing
Investing is a baseball game where there are no strikes. It can give you Amazon at X price, it can give you Microsoft at Y price and you can just stand there with your capital. You have to do nothing. And when Mr Market is really depressed, that's when you swing.
The optimal free trial length
A new study suggests businesses to shorten your free trial to 7 days. People will be more likely to convert and stay in the long term:
The more intensively we use a product during a free trial the more likely we are to buy it.
Longer trials give us more time to learn so we should be more likely to convert. However, when we are inactive during a trial - especially during the last days - we are less likely to buy.
The result is that a shorter, but more intense, use of the product in a short trial leads to higher conversions.
Until next time, folks !