Are SaaS companies burning less? Not really

Are publicly traded SaaS companies burning less? Surprisingly the answer is no. However are they operating more profitability? Most definitely. Below we show every publicly traded SaaS company (there are 63 as of Q1 2023) as well as a snapshot of their revenue, operating income, and margin.




In yellow, you can see that operating loss in Q1 2023 and Q1 2022 is nearly identical. It was approximately -$20mm on median both quarters. The averages are also very close at -$35mm and -$33mm respectively. SaaS companies are not reducing the burn. As you’ll see, operating expense has actually gone up.

However, in green, the operating margin has improved materially in Q1 2023 to -19% on median from -30%. This has happened because while operating loss hasn’t come down, revenue for SaaS companies is up. The median publicly traded SaaS company had revenue of $135mm in Q1 2023 versus $102mm in Q1 2022.

Investors seem to appreciate the improved profitability in spite of the continued level of operating loss (for now). We’d argue the same applies to private SaaS companies. So long as you’re growing cash efficiently and have 100%+ net dollar retention from high quality customers, you’re building value.

Sammy is the Managing Partner and Co-Founder of Blossom Street Ventures. Visit us at and email directly at We invest in companies with run rate revenue of $3mm to $30mm, with year over year growth of 30%+. We lead or follow in growth rounds and special situations like inside rounds, small rounds, rushed rounds, corralling investors with our term sheet, cap table clean up, and extensions. We can commit in 3 weeks and our check is $1mm to $4mm. Also visit for always up-to-date SaaS metrics.