AI-Native products and AI products integrated into a traditional SaaS platform have different Cost of Goods Sold (COGS) than a SaaS platform, which directly impacts Gross Margin. With over 80% of SaaS companies already integrating AI products into their platform, the Metrics Brothers knew it was time to discuss the Gross Margin and Cost of Goods Sold considerations of deploying an AI product:

Topics that CAC and Growth discuss during this episode includes:

• Gross Margin benchmarks for AI products versus SaaS platforms
• Cost of Goods Sold (COGS) for SaaS products
• Cost of Goods Sold (COGS) for AI products
• General Rules for COGS vs OPEX categorization
• Increasing AI product Gross Margins with scale
• The cascading reality of AI investments and build-outs

If you are considering investing capital and resources into an AI product, be it in an AI-Native product or as an add-on to a legacy SaaS platform, this conversation between CAC and Growth provides multiple insights and considerations for many Cost of Goods Sold components for AI products vis-à-vis traditional SaaS products.

See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

AI is creating a level of need for data centers, power and processing capacity that has not been seen before - but how to measure the magnitude of that need is the topic for the Metrics Brothers to take on during this episode.

During today's conversation, Dave "CAC" Kellogg and Ray "Growth" Rike discuss many key Data Center metrics including:

• FLOPS - Floating Point Operations per Second
• Model Parameters
• Watts and Gigawatts = Power
• Gigawatt/hours = Energy
• First multi-GW data center named Prometheus
• Why data center size is now being compared to the city of Manhattan

AI is changing the world as we know it - and the Metrics Brothers are diving into this trend metric by metric!

See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

SaaS companies were traditionally measured on how many years it took to achieve $100M ARR - a key milestone! In today's brave new world of AI, this milestone is now measured in MONTHS. Dave "CAC" Kellogg and Ray "Growth" Rike highlight discuss this new AI growth metric in today's episode with many examples including:

• Lovable
• Cursor
• Wiz
• Bolt
• Anthropic
• OpenAI

Dave and Ray discuss how these new hypergrowth AI-Native companies compare to some of the fastest growing traditional SaaS companies including DocuSign, Atlassian, Box, HashiCorp, Zoom and Slack.

The Metrics Brothers then dive a little deeper into the details of the "months to $100M" to discuss WHEN does that clock begin to tick, at launch or at $1M ARR? They then go beyond just AI and discuss how Product-Led Growth was once viewed as a key to accelerating growth to $100M and where the reality meets the expectations.

Lastly, CAC and Growth discuss one example of a fast growing AI company that could not quite sustain the early growth trajectory that was greatly helped by the hype and the hope of AI - a cautionary tale for other high flyers or just an interesting data point?

Take a listen to this episode if you are involved, interested or evaluating how growth rate expectations for software companies in the new era of software!!!

See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.