"Companies in this space are also in an arms race where there are very finite amounts of scalable channels. (Scalable means, in this instance, any way they can convert money into customers in a predictable fashion.)"
Just wanted to say - a very smart comment - and something that most people and frankly even VCs don't seem to get: that what works at $5m in bookings won't likely scale to $25m in bookings. This is why you see so many companies moving up to selling to the "Enterprise" - the Adwords driven, low-touch sales approach may scale for a handful of companies who were early and in extremely horizontal business - but for most more niche SaaS offerings, the writing is on the wall - that approach will get you only so far.
Just wanted to say - a very smart comment - and something that most people and frankly even VCs don't seem to get: that what works at $5m in bookings won't likely scale to $25m in bookings. This is why you see so many companies moving up to selling to the "Enterprise" - the Adwords driven, low-touch sales approach may scale for a handful of companies who were early and in extremely horizontal business - but for most more niche SaaS offerings, the writing is on the wall - that approach will get you only so far.