It has long been assumed that the cost of customer acquisition is the primary factor limiting SaaS companies’ top-line growth. External factors are also squeezing growth in the current market. On a macroeconomic level, founders are grappling with the new reality of the technological downturn. Furthermore, the cost of advertising is skyrocketing. The cost per thousand impressions (CPM) for Meta is up 61% year on year, while TikTok is up 185% and Google programmatic display is up 75%.
Because of these market conditions, SaaS companies require alternative growth paths. Cello has received €2.3M in pre-seed funding, led byFounders (who recently invested in Monta), with participation from Tiny VC, Possible Ventures, and Notion Capital, as well as operator angels from Youtube, Personio, McMakler, and others.
The funds will be used to expand the company’s market share in Europe and North America. The company claims to be well positioned for rapid growth, with a founding team comprised of serial entrepreneurs and veterans from Pitch, Twilio, and Typeform.
Word-of-mouth is an important factor in determining traction for early- and growth-stage startups. Despite its importance, founders are unfamiliar with the channel. Cello enables SaaS companies to transform word-of-mouth into a valuable acquisition channel. Whether a company is product- or sales-driven, SaaS companies can add a new ROI-positive, scalable channel in hours rather than months, with no operational overhead to manage.
How does it work?
Cello’s platform reimagines incentivized referrals in SaaS by privately rewarding users with a percentage of all net revenue (MRR) they refer. This novel approach to recurring commissions results in fraud prevention, a zero payback period, and a positive return on investment.
Cello, which was founded in 2022 by Stefan Bader and Robert Colletti, is a user-led growth platform that assists businesses in harnessing their most passionate users to drive word-of-mouth growth at scale. With just a few clicks, any SaaS product can be shared and discovered. Customers of Cello include SaaS companies such as Demodesk, Sastrify, Unlock, Butter, and others.
“Scaling product distribution is top of mind for every new software venture, with founders looking to gain an edge over the competition. Top companies are already tapping into their user base to attract and convert new customers, and see further opportunities to optimise this part of the sales journey. This is where Cello comes in. We help SaaS companies turn word-of-mouth into a customer acquisition superpower.”, says Stefan Bader, co-founder and CEO at Cello.
“The fastest growing companies already rely on self-engineered growth loops to amplify word-of-mouth. Cello’s approach revolutionises the opportunities available to SaaS companies, by enabling them to unleash the real potential of the channel. It’s a product that couldn’t be better timed with the current market trends.”, says Eric Lagier, Partner at byFounders.
“Word of mouth is the most coveted source of growth for early stage startups. We see self-engineered tools for amplifying word-of-mouth are often out of reach for companies who are laser-focused on building a great product. Cello enables this by making SaaS referral programs simple to set up and track”, says Philipp Möhring, Partner at Tiny.vc.
Simon Leicht, Partner at Possible Ventures says, “The progress that Cello has made is terrific, especially as building a business in the rapidly growing SaaS market is hard, especially given the current global market conditions. The Cello team has a clear understanding of their market, and a well-defined vision of what they want to achieve. We look forward to working with the team.”