October 7, 2025
Introducing the new Annual Planning dashboard in BenchmarkEngine: flexible views, benchmark comparisons, and faster insights.
Cloud channel strategies have evolved significantly over the past 20 years. Today there are a variety of SaaS channel sales models that companies have leveraged to exponentially increase sales and their potential customer base.
Over the years, I have become a “data hound” looking for every morsel of wisdom I can get to help me make smarter decisions. The good news here: accurate data is king. You can’t effectively manage your business without accurate data. Getting it is not always easy but without it you risk making the wrong business decisions -- hurting your business when you thought you were helping it. Allow me to explain.
Cost of Revenue (COR) is the second highest expense bucket for most SaaS companies, yet it often gets overshadowed by the highest expense category, Sales & Marketing.
Below is aggregate data on these raises with names redacted to preserve confidentiality. Figures like revenue, valuation, and round size are medians from conversations with founders. Remember the valuations and revenue multiples presented aren’t necessarily what the founders got, but rather it’s what they asked for when talking to VC.
Long-time readers of our work may recall we have strived to shed a light on the opaque, confusing, and volatile practice of valuing private SaaS companies. As we near the mid-point of 2019, we thought it would be good to check on current private company valuation multiples.
In the first half of 2019, total VC deal values hit $66B and is nearly on pace to match 2018’s record of $134.7B, according to the latest report released by PitchBook and the National Venture Capital Association. The size of VC funding deals continues to trend upward, while angel and early stage investing is holding its own in terms of the number of deals.
In looking at this issue across several companies, I’ve noticed a disturbing trend / missed opportunity in how many SaaS companies classify the reason for customer churn. Roughly speaking, if companies were hospitals, they’d too frequently be reporting the cause of death as “stopped breathing.”
If you don’t prepare ahead of time, you could get stuck not producing the top 5 SaaS metrics that investors want to see when they’re considering whether to invest in your next round. Not preparing the right SaaS metrics by venture stage for your VCs can ultimately reduce valuation, or even kill your fund raise.
In a recent meeting, a founder asked me what I thought of the fundraising environment. My answer was: it’s become incredibly sophisticated along three dimensions: diversity of product offering, pricing sophistication, and efficiency of investment processes.If you read eBoys or Done Deals or Creative Capital, you’ll get a sense of the early days of the venture industry. It started out with six men at a famous restaurant in San Francisco hearing pitches over lunch. None of them could afford to lead the entire round, so they would syndicate and take turns on the board. That was the “industry.”
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