This is a great use of an hour of time (for real).  I have not met Dharmesh Shah but follow his blog OnStartups and would love to have the opportunity to meet up some day.  I am also intrigued by his most recent company – HubSpot.

Below are the notes I captured as I watched this.  Great stuff. 

• A small exit is a good exit (but not if you take VC funding so be aware of the pros and cons)

• Be wary of the "attention economy" as advertising-based models are perilous

• Enterprise software selling sucks

• If you want to do a start up, get started

• Get your product or service out there and charge for it asap – people will tell you why they won't buy it

• Downsides to SaaS business models – margins aren't as good (b/c of COGS – you are running your own software); human costs; subscription shifts risk back to vendor

• Focus on total cost of customer acquisition (references Constant Contact); $300 sales/mkting/mkting programs cost versus lifetime value of customer($1500); factor in churn

• Drivers of that business: lifetime value and cost to acquire; focus on churn rate

• What can the usage data tell you?  CHI (Customer Happiness Index) is a probability calculation that a customer will stay with you; Did the customer log-in plus usage patterns; Customers that use this feature stay with us, those that don't use it leave; This data will make product management work

• On partnerships – don't do them.  The 900lb gorillas don't care (even though they act like they do); as for start up partnerships (you both want the same thing – looking in the mirror); but distribution partnerships can work if there is an established process and model.  Beware the time/resource suck from these efforts.

• On marketing/lead generation – create an industry/market blog (even before product) to get feedback, establish your reputation and domain expertise, will also help you understand if there is a there there; reduce market risk as early as possible (will anybody buy what I built?)

• Google Adwords – created an efficient market to connect sellers & buyers but still a Google tax involved (that is what organic search is all about)

• CPC is a 'morphine drip'; you become a victim of the latest market entrant who bids up the price

• Get good at being found in organic results (longer term b/c it is harder); upfront investment that pays off over time; make sure your website is best search result possible (be rank worthy).