Expensify is a software company that just went public. Below are some of the highlights and learnings from their prospectus. What they do. “Expensify is a cloud-based expense management software platform that helps the smallest to the largest businesses simplify the way they manage money. Every day, people from all walks of life in organizations…
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There are many ways to measure SaaS sales & marketing efficiency. One of the simplest is to look at new revenue booked over a given time period divided by sales & marketing spend during the period (New Rev/S&M). While the sales & marketing expense in a period may not necessarily be attributable to a given…
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How fast do you need to grow prior to exit? We looked at the last 67 SaaS IPO’s going back to MongoDB’s IPO in October 2017. The data is below. On median, these companies grew revenue 42% from the prior year, while the average was 50%. Median overall revenue was $185mm while the average was…
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A very important but often overshadowed metric in SaaS is gross dollar retention. Gross dollar retention measures how much of your customer revenue has remained with you a year later. Formulaically, it’s beginning ARR — downgrades — churn all divided by beginning ARR. It excludes upgrades. While 91 SaaS companies disclose net dollar retention (which includes upgrades) at…
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BackBlaze is a software company that is about to go public. Below are some of the highlights and learnings from their prospectus. What they do. “We are a leading storage cloud platform, providing businesses and consumers cloud services to store, use, and protect their data in an easy and affordable manner. By substantially reducing the…
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NerdWallet is a tech company that just went public. Below are some of the highlights and learnings from their prospectus. What they do. “At NerdWallet, we empower consumers — both individual consumers and small and mid-sized businesses (SMBs) — to make smarter financial decisions with confidence. We deliver guidance to consumers through educational content, tools and calculators, product marketplaces…
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Net dollar retention is the most important measure in SaaS. Formulaically when measured over a 12 month period, it’s ARR 12 months ago + upgrades — downgrades — churn that occurred over the following 12 months, all divided by that beginning ARR. A healthy SaaS business has net dollar retention over 100% because upgrades in the customer base are…
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Fast growing SaaS businesses are usually unprofitable, but what is level of operating loss or burn is acceptable? We looked at the last 66 software IPOs to answer the question, going back to MongoDB in 2017. The data is below and observations follow. Revenue to burn is 3.58x to 1. That’s the acceptable level…
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Informatica is a software company that just went public. Below are some of the highlights and learnings from their prospectus. What they do. “We have pioneered a new category of software, the Intelligent Data Management Cloud, or IDMC. IDMC is our AI-powered platform that connects, manages, and unifies data across any multi-cloud, hybrid system, empowering…
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The Bridge Group is a SaaS sales consulting firm that we hold in very high regard. They release outstanding sales data which can be found at their site, bridgegroupinc.com. We recently reviewed their “Sales Hiring Hourglass” which is primer on hiring B2B sales talent. It’s well worth the read, and below I summarize some of…
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