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Understanding Subscription Revenue

Baremetrics

Subscription revenue can be defined most simply as a model which generates income from customers through recurring fees that are paid at regular intervals. These can be weekly, monthly, or annual payments. Before we get into the more complicated stuff, let’s consider the difference between earning revenue and collecting revenue.

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The Mental Mapping from Annual to Monthly and Usage-Based SaaS Metrics

Kellblog

I’m writing this post to help readers who (like me) grew up in an annual subscription SaaS world adapt to the new and increasingly popular world of usage-based pricing [4], including month-to-month contracts and variable fees [5]. And what’s the impact on your other SaaS metrics? Hence, the revenue recurred.

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What Is Working Capital?

Baremetrics

While the equations are all fairly simple, finding the data to calculate all of these metrics is not. Accounts Receivable: This particular journal is only used under the accrual accounting system and not the cash accounting system. Accounts receivable includes the revenue that your company has recognized but not yet collected.

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What Is Unearned Revenue and How to Account for It

Baremetrics

You can often find yourself receiving money long before you provide agreed upon services or, conversely, providing services and then waiting for payment. This puts you in the position of having “unearned revenue”. Sign up for the Baremetrics free trial , and start monitoring your subscription revenue accurately and easily.

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Are You Counting Payments as Renewals?

Kellblog

Enterprise SaaS has drifted to a model where many, if not most, companies do multi-year contracts on annual payment terms. Buyers typically perform a thorough evaluation process before purchasing and are quite sure that the software will meet their needs when they deploy. How did we get here?

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What Is Accrual Accounting?

Baremetrics

In cash accounting, you record all revenue and expenses when the cash enters and exits your checking account, respectively. This system is often preferred by smaller companies because it requires less expertise to implement. The company might have to pay taxes on revenue earned but not yet received. Table of Contents.

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SaaS Balance Sheet Examples

Baremetrics

Speaking of your users, it is important to understand how much revenue they are generating with the best possible estimates of your MRR and ARR. Baremetrics brings you metrics, dunning, engagement tools, and customer insights. Sign up for the Baremetrics free trial and start managing your subscription business right.