September 4, 2025
Evaluate your SaaS go-to-market strategy with this 20-question GTM audit checklist. Assess sales, marketing, customer success, and data alignment for growth and scalability.
SaaS Cost of Goods (COGs) is the fulcrum on which gross margin and key SaaS metrics balance. SaaS Finance managers have to think strategically as they define exactly how to calculate COGs. More expense in the SaaS COGs bucket brings down gross margin but might improve Customer Acquisition Cost (CAC) - but this can have implications in the long term. On the other side, putting credit card processing, freemium hosting, and even Customer Success in operating expense lowers operating profit but raises gross margin.
While everyone agrees that leading health score indicators (i.e. adoption, maturity, satisfaction, etc.) are what you should action day-to-day, every Customer Success team needs to define the final “lagging” indicator to use with finance, executives, and the board. It shouldn’t surprise you that that metric is retention.
The following key operational SaaS sales KPIs and benchmarks are critical for planning company growth and expenses as well as to identify weaknesses - or strengths - in sales productivity and structures. Every SaaS company should know these SaaS Sales KPIs and be tracking and benchmarking themselves against peers and market leaders.
Building out, maintaining, and upgrading a technology stack requires a constant commitment to developers and engineers, so what is an appropriate level of development or R&D expense for a successful SaaS business? We looked at 74 publicly traded SaaS businesses at the time of IPO and 2 years prior to get a sense for how successful SaaS businesses allocate to R&D.
I’d like to share a couple of things that I think you should keep in mind when you present numbers, charts, and estimates in your deck. These simple tips and tricks are easy to implement, will help you bulletproof your deck and might smoothen your fundraising process.
Investors love SaaS customer cohort analysis. It shows that you are analyzing your business, using data to identify areas of strength and weakness. It shows that you know your customers and can analyze which segments are likely to grow and which are at risk for churn. If you can identify the groups most likely to churn, you can do something about it and improve your performance. If you know the groups most likely to grow, you can better allocate resources to find more of them and drive more sales and revenue growth.
How much can a customer success manager manage? I’d heard the wisdom of $1-2M in ARR per year and around 80 accounts. But I hadn’t come across any data. Last summer, Gainsight posted the results of their survey on the topic. The truth is most CSMs manage between $2-5M in ARR and somewhere between 10-500 accounts. But it varies by segment.
This week I listened to Jeff Epstein, Bessemer partner and former CFO of Oracle, present to CFOs and finance execs at Intacct’s Finance Summit. The Summit content was well done and kudos to Sage Intacct for organizing it.Jeff described the stages, pre-money valuation and milestones at each stage, from pre-seed to Series G and beyond. I think it bears reviewing here because the milestones represent how a leading venture fund measures the operational focus of a SaaS company at various stages. More importantly from a benchmarking perspective, the milestones define what key metrics a growth company should be tracking at various stages of growth. And heck, we can all learn from the models of one of the most successful venture firms in the world.
Over the last year or two, many of SaaS Capital’s portfolio companies have initiated channel sales strategies, and many more are contemplating it. Given the trend, this was the focus topic at a recent portfolio company CEO roundtable.
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