With SaaS models most of the time the revenue per customer is less than $100,000 per year making it difficult to pencil out a traditional shoe leather sales model. Consequently, we have gained extensive experience with low cost customer acquisition models. Deeter does a great job of laying out the “why”. In a follow-on piece, we’ll address the “how”.

Here’s the opener for Byron’s piece.

At Bessemer Venture Partners we fundamentally believe that the emergence of Cloud Computing – and the three core components of Software-as-a-Service (SaaS), Platform-as-a-Service (PaaS), and Infrastructure-as-a-Service (IaaS) – is going to completely change the economics of the multi-billion dollar software industry. We have been fortunate to be investors in many of the early Cloud winners (such as Postini, Netli, Trigo, and Cyota), and continue to invest actively behind one of the largest Cloud portfolios in the venture capital industry. Periods of tremendous transformation create tremendous opportunity, and we consider ourselves privileged to be working with many of the great entrepreneurs who are currently creating the next giants of the “software” industry.

When we first published Bessemer’s Top 10 Laws for Being “SaaS-y “ on Sandhill.com almost two years ago in conjunction with our annual Cloud/SaaS CEO Summit, we were overwhelmed with the positive response and feedback we received. We have heavily modified many of the best elements that we believe are still relevant, and have added several entirely new concepts for this update publication on Cloud Computing and SaaS.