Fresh Insights

Analyses, Musings & Observations

Learnings from the latest SaaS IPO – Enfusion

Enfusion is a smaller software company that just went public. Below are some of the highlights from their prospectus. The key learnings we took away: you can be small and go public (the last lower revenue business to go public was Livongo, a few years ago), dont structure contracts the way they do. What they…
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Learnings from the latest SaaS IPO – Gitlab

Gitlab is a software company that just went public. Below are some of the highlights from their prospectus. The key learnings we took away: you might have to sunset smaller/early customers, intentional transparency can be an asset (stop being so secretive), freemium is their way with land-and-expand to follow, smaller/lower risk releases are good, remote…
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Approaching b2b prospects

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 “Ultimate Sales Engagement Guide” which is a survey of how modern B2B buyers like to buy.  56% of the respondents in the…
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Tech multiples in Q3

Below are revenue multiples for publicly traded consumer tech companies we follow (B2C). Industries and therefore multiples vary widely. Commentary is below. If you’re looking for data on SaaS multiples, keep scrolling. Social media came down to 12.2x. Multiples rose steadily through 2020 peaking at 22.7x on median in Q1 2021. Q3 has them at…
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AE and SDR data

The Bridge Group is a SaaS sales consulting firm that we hold in high regard.  They release outstanding sales data which can be found at their site, bridgegroupinc.com.  We recently reviewed their “SaaS AE Metrics & Compensation Report” which compiles data from 287 executives at SaaS companies with median revenue of $27mm and median ACV…
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SaaS multiples are now 13x

SaaS comps continue to be strong. Of the 120 SaaS companies we follow, the average public SaaS business is trading at 20.0x revenue while the median is 13.0x. The gap between the average and median is wider than ever at 7.1x, meaning premium SaaS companies are getting outlier valuations. 57% of companies are trading at…
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Lessons from the latest SaaS IPO

Amplitude is a software company that just went public. Below are some of the highlights from their prospectus. The key learnings we took away: charge for the value you’re providing, not just by user; upsell by expanding use cases for the client; drive unlimited usage at the customer to make yourself sticky; and international markets…
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Learnings from the latest SaaS IPO – ForgeRock

ForgeRock is a software company that just went public. Below are some of the highlights from their prospectus. The key learnings we took away: this is a software company that transitioned to SaaS from perpetual license, pricing is not per-user, 3:1 ARR:loss ratio which is good in our view, sales are global, and upsells are…
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Stop pricing per user

In our view, it’s wrong to price SaaS contracts on a per user basis. Instead, a value based approach should be taken whereby the customer will see a 20x+ return on your software while you also earn 3x to 5x on your S&M spend to acquire the customer. Once you’ve figured out the price, delight…
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How long tech exits really take

We looked at how long it took 205 publicly traded tech companies to exit. Specifically, we used their prospectus (S1) to find out the year each company was founded and compared it to the last year financials were released as a private company. The data is below and organized between SaaS companies (140) and Other…
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