SaaStr

MARCH 8, 2024

Rag & Bone is selling to Guess $GES for $56m on ~$250m of revenue. A brand that previously held a premium aesthetic raised a growth round in 2013 from Irving Capital (7 For All Mankind, Aeropostale, Stuart Weitzman), but ultimately wasn’t able to sustain its growth. At least don’t spend all the money.

Churn 232

Churn Startup SaaS Payments Venture Capital 232

SaaStr

APRIL 19, 2024

He’s invested in startups as a VC since 2013 and has 10x his fund. EchoSign, which Adobe bought, had $12M in ARR, growing 100%, with 120% revenue retention and cash flow positive. The Adobes, Microsofts, and Intuits made $1M of revenue per employee. Now, every public SaaS company is at $300k to $400k of revenue per employee.

Engineering 252

Engineering Business Model Pricing Scaling 252

SaaStr

JULY 7, 2021

The second SaaStr post ever, way back in late 2012, was “ Everybody Lies: SaaS Revenues in the Inc. Let’s take a look back at where HubSpot, Upwork, and others were in 2011 GAAP revenue — and where they are today. Learnings for this year, for 2011 GAAP revenue (Inc. in 2011 GAAP revenue. generation.

SaaS 272

SaaS Technical Review Scaling Software Review 272

SaaStr

DECEMBER 8, 2020

Marketo IPO’s in 2013 at $700m market cap. Today, just 2 years after that, Hubspot in a very similar space (just more SMB) and with very similar revenue, is worth $18B. First product doesn’t work, no revenue for 3 years. 2013: first investment. And revenue has grown to $1B+ ARR for all the winners.

SaaS 208

SaaS SMB Cloud Revenue 208

SaaStr

JANUARY 18, 2023

International revenue is 36% of total, growing 124% a year. Getting More Efficient, But Still Spending 73% of Revenues on Sales & Marketing. SentinelOne was incorporated in January 2013. 90%+ of Revenue from Channel Partners. 90%+ of Revenue from Channel Partners. International is outperforming overall.

Cybersecurity 241

Cybersecurity Scale Cloud Scaling 241

SaaStr

APRIL 6, 2020

I wrote an early SaaStr post way back in 2013 on my “Year of Hell” as a SaaS CEO in 2008. In 2013, we were just 2 years removed from the real recovery from ’08-’09. That happy customers and recurring revenue will pull you out of. Will it be a V-shaped recovery this time? Or a swoosh? I don’t know.

Scale 341

Scale SaaS Cloud Scaling 341

SaaStr

JULY 4, 2021

One of the earliest posts I did on SaaStr was back in 2013 when I made my first venture investment, co-leading the seed round in Pipedrive. From 2013: I was asked on Quora why I recently invested in Pipedrive. The #1 thing I am passionate about on the revenue side in SaaS is Lead Velocity Rate. Most I quickly learned from.

Investment 259

Investment Scale Scaling SaaS 259

SaaStr

JANUARY 29, 2023

The Person that “Took Them From $0 to $100,000,000 in Revenue” or “That Scaled an Entire Dev Team from 1 to 100” or “Got Us On TechCrunch 7 Times in 8 Months” or whatever variant thereof. Zenefits was the hottest/fastest growing startup from 2013-2016. Here’s how to get the list of them.

Sales Hiring 288

Sales Hiring Scale Underperforming Technical Team Startup 288

SaaStr

FEBRUARY 22, 2023

It was just a little while ago that Salesforce was doing $1 billion in ARR revenue. And true enough … freemium only ended up being 20% of our revenue, at least strictly defined. And it’s better than that, these days. Because SaaS markets are just continuing to grow. Now they’re a good chunk of the way to $10 billion.

Scale 211

Scale Sales Hiring Venture Capital AWS 211

SaaStr

AUGUST 27, 2019

Around 2013 or so, the Cloud started to grow far faster than any of us had thought it would: Amazon Web Services revenue 2018 | Statista. We all knew before 2012–2013 it would be big. The markets took a while to catch up. There were dips in 2016 and otherwise. But enterprise buying went on a tear. It’s still accelerating.

Cloud 132

Cloud Azure AWS Enterprise 132

The Angel VC

DECEMBER 14, 2018

To answer the question, I took a look at the historic revenue development of ~70 of the largest SaaS companies. All revenue figures are based on GAAP revenue as reported by public SaaS companies, i.e. the numbers do not show a company’s ARR. In that case, I used 2013 for the “founded” year.

SaaS 174

SaaS Revenue Subscription Payment Features 174

Sparktoro

MAY 4, 2023

They are the co-authors of Forget the Funnel: A Customer-Led Approach for Predictable, Recurring Revenue. Customer acquisition in 2023 is not like customer acquisition in 2013. This is a guest post by Georgiana Laudi and Claire Suellentrop of SaaS educational and growth consultancy Forget the Funnel. The competition is much greater.

Consulting 61

Consulting Acquisition Education Revenue 61

SaaStr

MARCH 31, 2019

First up is RingCentral, which IPO’d relatively early and quietly in 2013. Since then, revenue has grown 5x and market cap 10x to an impressive $8.8 RingCentral was slow to international sales, still < 10% of revenue. We’ll check in with a bunch.

Systems Review 206

Systems Review SMB Cloud Enterprise 206

SaaStr

MARCH 8, 2020

Just revenue growth. And that does maximize short-term revenue. note: a 2020 update of a class 2013 post. You can focus on the future, while they are stuck in the present, and really, the present of about 2 years ago. #2 2 Has a Clear, Simple Target. If you’re #1, what’s your target? Yes, you worry about competition.

Innovation 254

Innovation Market Segmentation Pricing Branding 254

Tom Tunguz

MARCH 19, 2018

The company generated $297M of revenue in 2017 at a 73% gross margin, and grew by 58%. Salesforce is acquiring the business for an astounding 21x enterprise value to trailing twelve months revenue multiple - nearly 2x the next closest. A recent addition to the list of public software companies, Mulesoft is a tremendous business.

Acquisition 187

Acquisition Marketing Enterprise Revenue 187

Tom Tunguz

MARCH 17, 2018

The chart above shows the median enterprise value to forward revenue multiple to multiple. Forward revenue is the sum of the next 12 months’ revenue. Since 2013, we seen an incredible amount of volatility in SaaS forward multiples. The answer is close to ten year highs. The peak occurred in February 2014 at 7.7x.

SaaS 165

SaaS Healthcare SMB Enterprise 165

Tom Tunguz

SEPTEMBER 30, 2017

They generate revenue in two ways: subscriptions and merchant services. Since 2013, Shopify GMV has 10xed from $1.6B Since 2013, Shopify GMV has 10xed from $1.6B In that time, revenue has increased from $40M to $389M. No others as company I have analyzed has been able to improve sales efficiency as revenue increases.

Merchant Services 173

Merchant Services SaaS Payments Payments Payment Solutions 173

A Smart Bear

JANUARY 4, 2018

Late last year we passed $100M in annual recurring revenue. That revenue is thanks to 75,000 customers, earned through the hard work of 500 employees across six offices on three continents. We just announced a few more things.

Engineering 70

Engineering Investment Revenue Technical Review 70

SaaStr

JULY 14, 2022

This led to our first meet-ups in 2013 and 2014, the first SaaStr Annual in 2015 , the industry’s leading podcast in 2016, the first SaaS founder coworking space in 2017, and SaaStr Pro , the first learning management system for SaaS founders in 2018. Revenue leaders were able to network once again. VCs were able to meet with Founders.

Scale 283

Scale Sales Recruiting CTO Hire New CTO 283

The Angel VC

MAY 6, 2014

The x-axis shows the "lifetime month", so the dot at the end of the line at the bottom right, for example, represents the MRR of the January 2013 customer cohort (all customers who converted in January 2013) in their 9th month after converting. Note that for simplicity reasons the chart is based on revenues.

Data 157

Data Metrics Revenue Pricing 157

Tom Tunguz

AUGUST 20, 2017

forward revenues - the sum of projected revenues over the next 12 months. Today, we’re exactly where we were in 2013, at 5.4x, which is coincidentally, is the average over this time period. We’ve seen quite a bit of volatility in the valuations of publicly traded software companies over the last 5 years.

Marketing 145

Marketing SaaS Software Revenue 145

Tom Tunguz

DECEMBER 6, 2016

To answer that question, we can analyze the data set of all software companies acquired over the last six years and benchmark them by enterprise value-to-revenue multiples. Not every EV/Revenue multiple is known, but this data set can provide us some directional guidance on how the market has changed.

Acquisition 100

Acquisition Startup SaaS Benchmarks 100

Tom Tunguz

AUGUST 26, 2014

We will explore revenue growth, average revenue per customer, sales efficiency, payback periods, net income, gross margin and engineering spending. HubSpot has achieved amazing revenue growth in their first 7 years as a company growing by more than 12x from $5.7M in 2009 revenue to 2013 revenue of $71M - an 88% CAGR.

Benchmarks 111

Benchmarks SMB Metrics SaaS 111

Kellblog

JULY 25, 2020

Here’s the first one, which shows the progression of the EV/NTM revenue multiple [2] for a set of 50+ high-growth SaaS companies over the past 15 or so years [3]. While the green line (equity-value-weighted [4]) is most dramatic, the one I gravitate to is the blue line: the median EV/NTM revenue multiple. Sometimes (e.g.,

Technical Review 95

Technical Review Software Review Pricing Metrics 95

Sixteen Ventures

JULY 17, 2020

This article was originally written in 2013 and has been updated several times over the years. As I stated in 2013, the answer to “What is a good SaaS Churn rate,” was, “you want a churn rate to be ‘as low as possible.'” The lessons are accurate even in 2020. Is 5% Monthly Churn Good?

Churn 133

Churn SaaS B2C Pricing 133

The Angel VC

OCTOBER 24, 2013

If you also want to see your churn on an MRR basis and get a sense for your CLTV, you’ll also have to enter the corresponding revenue numbers. Start with January 2013 and enter the number of new customers that you’ve acquired in that month. If your data goes further back than January 2013, extend the table accordingly.

Customer Lifetime Value 211

Customer Lifetime Value SaaS Churn Growth Hacking 211

Tom Tunguz

MAY 23, 2016

The chart above plots the total revenue of publicly traded SaaS companies by ACV bucket. Surprisingly, the share of revenue across these three buckets is equal. So, on average, a SaaS company in any of these three segments generates roughly equivalent revenue. These demarcations are not industry-standard, but my own.

Outsourced Development 137

Outsourced Development SaaS SMB Enterprise 137

Frontegg

MAY 27, 2021

Instead you should focus on Natural Rate of Growth (NRG) to determine the percentage of recurring organic revenue. This metric is a strong future revenue indicator. Founded: 2013 Known customers: Lyft, Clearbit, Amplitude, AdRoll, Segment Price starts at: $249/month. #3 Best For: Revenue Acceleration. 3 Frontegg.

Payment Solutions 98

Payment Solutions SaaS Payments Payments Scale 98

The Angel VC

OCTOBER 26, 2014

Following the first PNC SaaS Founder Meetup in San Francisco in 2012 and the second one in 2013 in Berlin, this has become a tradition for us: Once a year we're bringing together the founders of our SaaS portfolio companies, co-investors and leading experts for a full day of intensive knowledge sharing.

CTO 111

CTO SaaS Customer Success Revenue 111

Tom Tunguz

SEPTEMBER 2, 2014

We will explore revenue growth, average revenue per customer, sales efficiency, payback periods, net income, gross margin and engineering spending. Zendesk has matched the SaaS median for revenue growth each year, and slightly exceeded it in 2013. in revenue. and in 2013, a figure of 1.0, compared to 1.1

Benchmarks 100

Benchmarks Metrics SaaS Scale 100

Andreessen Horowitz

APRIL 30, 2024

A lot of the things that we ultimately did when I was running Global Payments from 2013 to 2023, a lot of things that we ultimately did were not even like a glint in my eye back in 2009, 2010 when I was just thinking about coming over. I think we were doing something like $3 billion of revenue a year in software sales.

Payment Solutions 82

Payment Solutions Payments Payment Services SaaS Payments 82

Tom Tunguz

JANUARY 20, 2014

First, venture capitalists invested nearly $1B of capital in the IoT in 2013, more than 3% of all VC investments by dollars. The IoT momentum generated in 2013 will only continue to grow, as the number of connected device startups and products compounds, each looking to satisfy an unmet consumer want or enterprise need.

Acquisition 100

Acquisition Innovation Startup Investment 100

SaaStr

APRIL 2, 2023

Mistake: Not being myself Our first Pulse conference – which became the industry event for Customer Success – was in a small San Francisco ballroom in 2013. Stick to your values and vision and, in the words of Lin Manuel Miranda from Hamilton , “Wait for it.”

Sales Hiring 270

Sales Hiring Scale Scaling Customer Success 270

Tom Tunguz

SEPTEMBER 21, 2014

The company went public in 2013 and we’ll use data from their S-1 through 2013 to benchmark the business. We will explore revenue growth, average revenue per customer, sales efficiency, payback periods, net income, gross margin and engineering spending.

Benchmarks 100

Benchmarks SaaS Payments Metrics Scale 100

Sales Hacker

AUGUST 2, 2023

For those of you who don’t know, my partner Max Altschuler , founded Sales Hacker in 2013 and ran it for 5 years (I joined SH later in the journey) before it was acquired by Outreach where it ran for another 5 years. We re-acquired Sales Hacker and are relaunching it under GTMnow, the media extension of the GTMfund ! This is our moat.

Sales Hiring 53

Sales Hiring Sales Acquisition Education 53

Tom Tunguz

JUNE 9, 2015

The upsell rate was 36%, 31% and 30% for the years ended December 31, 2014, 2013 and 2012, respectively. It’s a metric of revenue retention that doesn’t allow large customer upsells to mask customer churn, and it conveys the health of the broad base of the business. where ACV is annual contract value.

Churn 100

Churn SaaS Retention Startup 100

Tom Tunguz

AUGUST 23, 2015

It’s not that the fundamentals of these businesses have changed broadly; rather public market investors view newly minted public software companies with more caution The chart above shows the Enterprise Value to Forward Revenue Multiple over the last two years. EV to Forward Revenue is tied for the third lowest in the last 24 months.

Marketing 111

Marketing SaaS Enterprise Pricing 111