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TL;DR: While most public SaaS companies are growing at 8-10%, the companies crushing it are those selling outside the tech bubble – restaurants, construction, logistics, and e-commerce. They’re growing 2-3x faster than traditional horizontal SaaS. Many are doing pretty, pretty, well. Build the Monday.com for your industry.
When SaaStr Fund made the first investment in RevenueCat back in 2018, nobody could have predicted that this “simple API for managing in-app subscriptions” would become the infrastructure powering 33% of all mobile subscription apps and reach a $500M valuation in 2025. ” required weeks of developer time to answer.
In the latest billion+ acquisition, Xero just acquired Israeli-founded, NYC-based Melio for $2.5B to dominate US SMB payments. The deal shows acquirers are hungry for revenue acceleration—Xero expects to more than double group revenue by 2028 with this acquisition. TL;DR : After years of M&A drought, big deals are returning.
My hope is that this analysis can provide startup entrepreneurs with a framework for how to manage their businesses around SaaS metrics (e.g., FCF Margin FCF is an important metric to evaluate in SaaS businesses. Because of the recurring nature of SaaS revenue, you can afford to have paybacks longer than 1 year.
valuation—the fastest to $100M ARR in SaaS history (12 months) Replit : $100M ARR at $1.16B valuation—10x growth in 18 months Lovable : $50M ARR by April 2025, €14.3M What This Means for B2B: The New Playbook Replit’s success signals fundamental shifts in how successful SaaS companies will be built: 1.
As Checkr follows usage-based pricing, it’s a transactional business that needs to be managed differently than a typical subscriptionSaaS model since they only earn revenue when the customer is using the product. The SMB sales team was incentivized purely on logo acquisition rather than revenue.
A lot of you reading SaaStr are probably more B2B SaaS oriented and may not be paying attention to the consumer market, but it’s already massive and is continuing to grow quickly. In this week’s Workshop Wednesday, RevenueCat CEO Jacob Eiting and Growth Advocate David Barnard share their annual State of Subscription Apps report with us.
First IPO in 1999 First acquisition for $5.3 Most SaaS founders think in quarters or years. What This Means for Your B2B Company If you’re building enterprise SaaS today: Think infrastructure, not just applications. IPO private IPO acquisition is becoming a common path. Informatica acquired for $8 Billion!
Whether you are a startup owner, a manager of a growing business or the CEO of an established company, you might find yourself asking questions like “ Should our SaaSsubscription model be monthly, annually or both ?” or “ What are the best tips I can get in terms of annual vs monthly subscription models ?”.
Looking to leverage FastSpring’s Digital Invoicing for your SaaS or gaming business? For many SaaS companies, being able to accurately apply tax exemptions across the globe is a vital step for accuracy in quotes as well as reporting when tax time comes around. Sign up for a demo or check out our free trial. What does this mean?
That’s the beauty of subscription models. While implementing a subscription model means ongoing revenue, it also brings up many challenges for managing those subscriptions. You have to create a subscription-friendly product, infrastructure, marketing plan, and customer retention plan. Advantages of a Subscription Model.
The term SaaS platform gets tossed around a lotbut what does it actually mean, and why does it matter for today’s software companies? Whether you’re building your first product or scaling an established solution, understanding the SaaS platform model is essential for long-term growth. Contact sales What is a SaaS Platform?
How Figma Makes Money From the S-1: “Our subscription model is designed to meet the diverse and evolving needs of our growing community and customer base. Access to Figma is sold as an annual or monthly subscription, per seat. ” [ My note: these seats include viewer, collab, content, dev and full ].
Debt for SaaS companies done right is a gift. Few folks have more data than Nathan Latka and he offers up some insights on how to properly leverage up in SaaS. Geoffrey Moore calls this group the Late Majority and the Laggards in his book Crossing the Chasm , a secret bible for many SaaS CEO’s. . — ed.
SaaS pricing isn’t static – it’s a living strategy that grows with your company. From your first paying customers to enterprise domination, here’s how successful SaaS companies level up their pricing game to maximize growth and profitability at every turn.
You might be surprised to know that SaaS companies can learn a lot from their consumer subscription counterparts. The differences between SaaS and B2C companies. 2: Payment structure SaaS is paid on a recurring basis. But most SaaS organizations still have the luxury of long-term (2+ year) contracts.
It’s the vertical SaaS rocketship: $840m ARR Still growing a stunning 29% (!) Theyve built a true operating system for the tradeshandling everything from CRM to payments to field service management. Lesson for SaaS Founders : If youre in vertical SaaS, aim to be the OS for your niche. 5 Interesting Learnings: 1.
Churn increase due to greater scrutiny of costs Contract values declining More stakeholders involved in decision-making Capchase combined the study with their data set of thousands of SaaS companies and looked at what the best companies do to overcome these hurdles. 2: Offer Flexible Payment Terms This is another debate going on in SaaS.
The Talent Reckoning Here’s what I’ve learned from talking to 200+ SaaS founders over the past six months: The companies shipping great AI aren’t necessarily the ones with the biggest AI budgets or the fanciest ML infrastructure. The $939B Question: Is AI Eating SaaS or Feeding It?
2024 is coming to a close, and it has been a terrific year for SaaS businesses as the industry has witnessed quite a favorable growth. For SaaS companies, accounting becomes one of the most crucial processes to understand their financial and overall business health, and then make informed decisions about future steps.
What if you could boost revenue without having to invest a small fortune in new customer acquisition? In this article, you will explore why customer expansion matters for your SaaS growth, discover various customer expansion tactics, and learn how to embed them in successful expansion campaigns.
Let’s talk about Vimeo and what it’s really like to make a large public SaaS company profitable in a short amount of time. They also have a media segment, a separate business supporting creators who want to do subscription-based video monetization. Customer acquisition. This is how Adam ended up at Vimeo. It’s a pain.
Most Stripe alternatives fall into one of two categories: (1) payment processors, or (2) a billing solution that covers payment processing and other aspects of billing such as fraud detection, checkout, and more. MoRs for SaaS Companies. MoRs for SaaS Companies. FastSpring: International Payment Solution for SaaS.
Only 20% of Revenue from “SaaS”, 80% From Transactions and Float (Fintech) Bill started off 100% SaaS, and slowly and deliberately added payments. Fast forward to today, and only 20% of its revenue is from software subscriptions. At least at scale. #2. Float began to get material pre-IPO.
Subscription Models: Usio will provide general insights into why subscription-based payment processing is often considered advantageous for Software as a Service (SaaS) businesses. Predictable Revenue Streams: Subscription models provide a consistent and predictable revenue stream for SaaS companies.
Long before the digital age, newspaper and magazine companies have been using the subscription model to create and retain a consistent readership for their publications. This business model has now been adapted very well in the internet age, especially in the SaaS (Software-as-a-Service) and eCommerce industries.
What is customer acquisition for SaaS, and how can you leverage it to drive sustainable growth ? The purpose of customer acquisition is to expand and make more revenue. Customer acquisition funnel stages in SaaS are Awareness, Consideration, Evaluation, Conversion. What is customer acquisition?
With many customer acquisition channels available, how do you choose the right one? Read on to find the best acquisition channels for your SaaS and how to create winning customer acquisition strategies that drive growth. The customer acquisition funnel stages in SaaS are awareness, consideration, evaluation, and decision.
These two departments are a SaaS company’s most important; without their alignment, there is no growth or scale. Prakash Raina, Co-Founder of Subskribe, and Leslie Hui, VP of Accounting Operations and Finance Transformation at Okta, break down the secrets to unifying SaaS teams, processes, and systems. The evolution of SaaS business.
Only 18% of Revenue From SaaS. Shopify and Bill both also get the majority of their revenue from financial fees and transaction fees, not software subscriptions. It’s probably not really a SaaS company, but close enough to include it in our series and our ecosystem. #3. HubSpot is, and Toast is as well. #2.
If New Relic had even 120% NRR, it’s growth rate with the exact same rate of new customer acquisition would be 137% instead. Done right, this sort of anti-SaaS pricing model can lead to significantly more revenue. In New Relic’s case, moving from subscription to consumption based usage has increased net revenue 15%.
The SaaS industry has seen explosive growth in the past decadeand this is expected to continue this year. Join the payments-led growth movement Sign up to keep up-to-date with the latest trends in payments, vertical SaaS, and technology from industry experts. Customer acquisition cost. Customer lifetime value.
For subscription-based businesses achieving consistent and predictable revenue growth is the holy grail. In fact, monthly recurring revenue (MRR) is one of the most important metrics subscription businesses should be aware of. MRR is an important metric for SaaS businesses to track to understand business health.
We recognize revenue from our SaaS contracts ratably over the term of the subscription period, which is typically three years but can range from less than one year up to ten years. .” How OneStream Makes Money From the S-1: “Our business model centers on maximizing the lifetime value of a customer relationship.
The best SaaS companies Lightspeed has seen in their portfolio are maniacal about defining these key metrics and tracking them with specific targets in mind on a consistent basis. Work with Great Executive Recruiters ”The first time I saw an invoice for an executive search, I think I had a heart attack,” Shrav joked. Execution is king.
“Churn” is a term we all use in SaaS as a core metric, but its roots, as near as I remember and can tell, come from our B2C colleagues. Folks churn out of their Verizon plan, their Netflix subscription, etc. In a low-end subscription model for a tool, not a solution (e.g., the dynamics are similar. Like Verizon.
. “The Playbook to Boosting Net Retention (Quickly) with Terminus’s CEO” Fresh off their $90m Series C, SaaS veteran Tim Koop shares their secrets to happier customers. #4. 5. “The Cadence: How to Turn Your SaaS Startup into an Army” With David Sacks of Craft Ventures. .
What does customer satisfaction look like for SaaS businesses? Unlike traditional businesses, most SaaS businesses operate the subscription pricing model. As a result, satisfying customers is key to any success in SaaS. SaaS customers expect your continued support if they’re to remain your loyal customers.
I’ve been fortunate to work in a number of SaaS businesses in my career. In the case of a B2B SaaS company, your Go To Market model outlines the way in which you acquire customers. MailChimp (Touchless acquisition) – MailChimp is an email marketing tool that uses a touchless acquisition model to acquire customers.
Qualtrics is one of our favorite SaaS stories at SaaStr. We’ve seen some SaaS leaders NRR stay world-class, but decline a bit around $1B in ARR. Most folks slow down then, e.g. as LinkedIn did for a year or so after the Microsoft acquisition. #9. And a few bonus points: #6. NRR consistent at 122%. Not Qualtrics.
Customer Acquisition Cost (CAC). & So growth of the kind of subscription, eCommerce industry has been over 100% year on year for the past five years, according to McKinsey. So the first question is what made SaaS so successful. Customers love SaaS products and tools because it simply works. They love SaaS products.
No pressure, but the pricing model you choose can make or break your SaaS business. Fortunately, other successful SaaS leaders have experience with this challenge. Most startups go with freemium, which can be favorable for customer acquisition early on. unlimited cashback up to the amount of their subscription.
So read on, and hopefully, your SaaS sales journey will be less about trial and error and more about steady progress toward success. PLG-first SaaS companies rely on their product as the primary way to engage customers, making self-service sales a natural fit for conversion after experiencing the product.
At the helm of Udemy for Business’ customer acquisition machine is their VP of Marketing Yvonne Chen. Since then, she’s helped grow the Udemy’s B2B SaaS arm to more than 5,000 enterprise customers, which include the likes of Pinterest, Adidas, and General Mills. We think that you’d be great at teaching this skill.
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