Baremetrics

AUGUST 8, 2021

For most, the easiest ways to increase customer acquisition rates are to offer a freemium model or price your product on the lower end of the spectrum. However, to keep your business afloat, you’ll need to effect a SaaS price increase. Results in an Increase in Revenue 2. Raise Prices for New Customers 2.

Pricing 111

Pricing SaaS Scale Churn 111

Clouded Judgement

SEPTEMBER 12, 2023

Through these interactions, I’ve built up mental benchmarks for metrics on which I place extra emphasis. We will see this show up in revenue figures in a quarter or two. Beating consensus revenue estimates is the first aspect of a successful quarter. net retention and CAC payback).

Cloud 169

Cloud Software Benchmarks Retention 169

Tom Tunguz

AUGUST 26, 2019

24% of revenues are international. The company is currently at $333M in quarterly ARR and generated $265M in trailing 12 months revenues, up from $145M the previous period. At the time of IPO, both DDOG and APPD filed at about $200M in revenue. DataDog is playing across price points. Look at that beautiful curve!

Metrics 189

Metrics Benchmarks Scale User Experience 189

SaaStr

SEPTEMBER 20, 2023

Discover Bessemer Venture Partners’s annual State of the Cloud report, going through trends, benchmarks, and metrics that underpin the Cloud economy. At the peak of bull market exuberance at the end of 2021, a 1% improvement in revenue growth had the same impact on valuations as a 6% improvement in free cash flow margin.

Cloud 225

Cloud Payments Software Review Payment Solutions 225

ChurnZero

JUNE 2, 2021

SaaS Capital joined us for a webinar to share the results from their 10th annual B2B SaaS benchmarking survey. Q: How do you calculate net revenue retention for a usage-based model? I still think that net revenue retention works really well. How does your company stack up to its peers in this regard? Q&A Recap.

Benchmarks 98

Benchmarks B2B SMB SaaS 98

Tom Tunguz

MARCH 18, 2019

the company generated $107M of trailing 12 month revenue, services 33% of the Fortune 500, grew revenue at 48% and has a net retention rate of 139% across 10,800 customers. Sales efficiency is a measure of the marginal gross profit generated by a dollar invested in sales and marketing.

Metrics 192

Metrics Benchmarks Software Review Engineering 192

Tom Tunguz

FEBRUARY 24, 2016

In particular, I benchmarked the revenue, growth rates and round size characteristics of these businesses at their Series A. Benchmarking Exceptional Series A SaaS Companies from Tomasz Tunguz. That figure has grown each year by 80%, and for the investments that closed in early 2016, that figure reached $163k.

Benchmarks 100

Benchmarks SaaS Pricing Investment 100

Clouded Judgement

APRIL 12, 2023

Through these interactions, I’ve built up mental benchmarks for metrics on which I place extra emphasis. Beating consensus revenue estimates is the first aspect of a successful quarter. The formula to calculate this is: (Q4 ’22 revenue) / (Q4 ’21 revenue) - 1. net retention and CAC payback). .”

Cloud 161

Cloud Software Benchmarks Retention 161

Clouded Judgement

JUNE 20, 2023

Through these interactions, I’ve built up mental benchmarks for metrics on which I place extra emphasis. The market is clearly pricing in lower rates + reacceleration of growth. Beating consensus revenue estimates is the first aspect of a successful quarter. net retention and CAC payback).

Cloud 161

Cloud Software Benchmarks Scale 161

OpenView Labs

NOVEMBER 18, 2021

Today we released our fifth annual Financial & Operating Benchmarks Survey (formerly known as Expansion SaaS Benchmarks). product-led growth), and benchmarks well against economics that support high Free Cash Flow margins over the long term. In fact, PLG companies generate 1.7x Forget the Rule of 40.

VP of Engineering 64

VP of Engineering Benchmarks Sales Hiring B2B 64

OpenView Labs

NOVEMBER 12, 2020

When we were preparing the 2020 expansion SaaS benchmarking survey, our biggest question was: “How did COVID-19 and the economic downturn affect private SaaS companies?” Respondents were primarily CEOs (38%) and CFOs (29%) at expansion stage software companies with $1 to $20MM in annual recurring revenue (57%).

Benchmarks 52

Benchmarks Scale Technical Review SaaS 52

Clouded Judgement

DECEMBER 20, 2022

Through these interactions, I’ve built up mental benchmarks for metrics on which I place extra emphasis. Beating consensus revenue estimates is the first aspect of a successful quarter. The formula to calculate this is: (Q3 ’22 revenue) / (Q3 ’21 revenue) - 1. net retention and CAC payback).

Cloud 130

Cloud Software Review Software Benchmarks 130

ProfitWell

SEPTEMBER 30, 2019

Revenue is good. Lots of revenue is great. Optimized revenue is better. Because the world of e-commerce is so restless, as soon as your company finds itself bringing in steady revenue, the first question anyone will be asking is: How can we make this performance even better ? What is revenue optimization?

Revenue 40

Revenue Pricing Outsourcing Services Merchant Services 40

Tom Tunguz

SEPTEMBER 10, 2013

Benchmarking is a great tool, if you can get access to representative data. Pacific Crest and David Skok have released a fantastic survey benchmarking SaaS metrics for early and growth stage companies. Below is my list of the six most important benchmarks and observations from that report. Median Monthly Revenue Churn is 0.75%.

Benchmarks 108

Benchmarks Startup Sales Hiring Compensation 108

User Pilot

OCTOBER 15, 2023

Use benchmarks to monitor your performance to see how well each stage converts. By enhancing the customer experience, CRO ensures a seamless user journey and brings financial benefits such as lowering acquisition costs and enhancing Monthly Recurring Revenue (MRR). The industry benchmark for this metric sits at 8.5%.

SaaS Payments 105

SaaS Payments Payment Methods Payment Solutions Payments 105

OpenView Labs

SEPTEMBER 8, 2021

2021 has proven to be the year of usage-based pricing. . 45% of expansion stage SaaS companies now say they have a usage-based or consumption-based pricing model, according to data from OpenView’s forthcoming 2021 Finance and Operations benchmarks report. . Product: Treat product investments as a revenue-generating expense.

Pricing 64

Pricing Customer Success Scale Compensation 64

SaaStr

JULY 27, 2023

Investors currently struggle with price finding for these rounds. There’s no new normal or price set yet, and that uncertainty creates a little bit of fear among investors to overpay. “Am And finding that right clearing price is still a work in progress. Now, it’s closer to $2M, with many good funds investing between $2.5M

AI 172

AI Trends Banking Pricing 172

Tom Tunguz

SEPTEMBER 29, 2014

This post is part of a continuing series evaluating the S-1s of publicly traded SaaS companies in order to better understand the core business and build a library of benchmarks that might be useful to founders. MobileIron went public on Jun 12, 2014 with $100M in revenue and more than 6,000 customers. just two years before.

Benchmarks 100

Benchmarks Metrics SaaS Scale 100

SaaStr

MARCH 27, 2023

Capchase’s dataset is comprised of roughly half bootstrapped companies and half VC-backed companies, so there will be some differences in benchmarking from what you see from the VC firms. One, when you have really high gross margins, your cost base actually increases much slower than your revenue base. How do they achieve this?

SaaS Payments 191

SaaS Payments Technical Review Software Review Venture Capital 191

Stax

FEBRUARY 21, 2024

So, of course when it came to revenue-driving activities, Ford knew that success in marketing—and business—wasn’t about how much your marketing spend is, but how efficiently you spend it. Enter the SaaS Magic Number, which measures the return on sales and marketing spend in generating new subscription revenue.

SaaS Payments 88

SaaS Payments Payments Payment Services Stax 88

ProfitWell

JANUARY 13, 2020

There’s a question that every startup founder, subscription service provider, and ecommerce store owner, needs to ask themselves on a regular basis: Is this the most effective price for my product or service? If the answer is no, then there is potential for revenue-related issues as your company matures. What is an effective price?

Pricing 52

Pricing Subscription Payment Features Strategy 52

OpenView Labs

FEBRUARY 4, 2020

Segment CEO and Co-founder Peter Reinhardt was recently reflecting on what were his top lessons learned from changing packages and pricing. While Segment may be an extreme case, the business is far from unique in learning that it was leaving money on the table due to its pricing. Pricing Is Your Best Shot at Growing 25% Faster.

Pricing 60

Pricing Scale Technical Review Software Review 60

User Pilot

OCTOBER 5, 2023

TL;DR The CAC payback period measures the time it takes for a company to recover the money invested in new customer acquisition. This metric helps SaaS companies choose the most effective customer acquisition channels , diagnose inefficiencies in customer retention strategies , and inform pricing decisions. Book the demo to see how!

SaaS Payments 105

SaaS Payments Customer Lifetime Value Payment Solutions Acquisition 105

Tom Tunguz

SEPTEMBER 21, 2014

This post is part of a continuing series evaluating the S-1s of publicly traded SaaS companies in order to better understand the core business and build a library of benchmarks that might be useful to founders. The company went public in 2013 and we’ll use data from their S-1 through 2013 to benchmark the business.

Benchmarks 100

Benchmarks SaaS Payments Metrics Scale 100

Clouded Judgement

DECEMBER 9, 2022

I went back and looked at the last ~50 software IPOs and benchmarked them across a number of metrics. Revenue multiples are a shorthand valuation framework. Multiples shown below are calculated by taking the Enterprise Value (market cap + debt - cash) / NTM revenue. Follow along to stay up to date! Top 5 Median: 11.7x

Cloud 130

Cloud Benchmarks Subscription Payment Features 130

ChurnZero

JUNE 9, 2023

Good sales teams typically get the budget, headcount and tools they desire because the function is tied to revenue. Annual recurring revenue (ARR) ARR is the aggregate value of contracts that renew yearly. This will help the finance team relate proposed investments aimed at supporting renewal with business growth.

Finance 98

Finance Metrics Customer Success Headcount 98

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 108

Benchmarks SMB Metrics SaaS 108

OpenView Labs

SEPTEMBER 23, 2019

We’re living in a remarkable era for investing. In this world, where top assets are scarce and capital is plentiful, double digit revenue multiples have become the norm and it isn’t unusual to see some SaaS companies achieve valuations approaching 30x their revenue. How Do I Know What My Benchmarks Are?

Benchmarks 40

Benchmarks Data SaaS Scale 40

Tom Tunguz

NOVEMBER 16, 2014

This post is part of a continuing series evaluating the S-1s of publicly traded SaaS companies in order to better understand the core business and build a library of benchmarks that might be useful to founders. In industry parlance, this is called negative revenue churn.

Benchmarks 100

Benchmarks Underperforming Technical Team Metrics Sales Hiring 100

Tom Tunguz

FEBRUARY 20, 2017

Today, the business generates nearly $200 million annually in revenue, and is growing at 70%. The chart above shows the subscription revenue is roughly at $150 million and professional services revenue is about $35 million this year. Growing quickly at the scale is no mean thing. Mulesoft is an incredible company.

Metrics 100

Metrics Benchmarks Scale Finance 100

Tom Tunguz

JUNE 8, 2015

ServiceNow grew from$19M in revenue to $178M in 4 years, sustaining a 75% CAGR during that period. At IPO, ServiceNow recorded a $95,000 average revenue per customer, placing in the top third of SaaS companies in terms of average revenue per customer. at $93M in revenue. This figure has grown by 27% per year.

Benchmarks 108

Benchmarks Metrics SaaS Investment 108

Clouded Judgement

AUGUST 25, 2023

The purpose of the detailed information is to help investors (both institutional and retail) make informed investment decisions. There’s a lot of info to digest, so in the sections below I’ll try and pull out the relevant financial information and benchmark it against current cloud businesses.

Benchmarks 246

Benchmarks Artificial Intelligence Data Software Review 246

Clouded Judgement

APRIL 4, 2024

The purpose of the detailed information is to help investors (both institutional and retail) make informed investment decisions. There’s a lot of info to digest, so in the sections below I’ll try and pull out the relevant financial information and benchmark it against current cloud businesses.

Benchmarks 117

Benchmarks Data Cybersecurity Cloud 117

InsightSquared

MAY 7, 2019

When scaling the business, sales typically averages roughly 30% of revenue, so therefore sales spend is one of the biggest investments a company can make. These processes are important to track accurately and benchmark to achieve the SaaS performance expected in the market. Customer churn or retention rates.

Scale 102

Scale Sales Hiring Metrics Sales 102

SaaSOptics

AUGUST 11, 2022

So far this year, only 42 companies have priced IPO offerings. Reevaluate your billing and pricing models. Pricing is a blind spot in many B2B SaaS companies where lead generation and customer renewals are seen as the MVPs of revenue generation. That is on pace to total less than half of last year’s 399 IPOs. .

Scale 97

Scale Scaling Technical Review Venture Capital 97

OpenView Labs

MAY 24, 2021

In OpenView’s 2020 SaaS benchmarks , we pointed out that public markets were starting to take notice of product-led companies. The companies on OpenView’s PLG index traded at a 50% revenue multiple premium to their SaaS peers, with the valuation gap widening over the course of the year. Atlassian has an R&D:S&M ratio of 2.9:1.

Scale 98

Scale Headcount Sales Hiring Benchmarks 98

ProfitWell

NOVEMBER 15, 2019

So I’ll unpack some of our favorite tools that cater to certain needs—analytics, accounting, retention, pricing, and more. From optimizing your pricing to CRM—there’s a tool tailored for all your SaaS needs. Accounting software will keep all revenue assets organized. Why does your SaaS business need tools? Analytics.

Retention 56

Retention Pricing SaaS Payments Payment Methods 56