Lauren Kelley on SaaS


Effective and strategic CFOs incorporate accurate benchmarking into the daily business of the company and especially into the budgeting and planning process. Benchmarks provide context for initial budgeting drafts and provide guide rails for managers to use in forecasting their needs for the upcoming year.

By Lauren Kelley | September 9, 2021

We invited an expert on Scaling Finance, Anup Juneja, an Expert Senior Manager at Bain & Company, for part of the SaaS Finance MeetUP. Anup works on G&A and FP&A transformation with numerous clients. He shared his perspective on the four things that world-class Finance organizations have to get right. His presentation took the traditional focus on People, Process and Systems to a far more strategic level when thinking about how SaaS and software CFOs need to frame their organizational planning for scale.

By Lauren Kelley | July 27, 2021

In honor of Canada Day (July 1) and US Independence Day, we’ve compiled a few interesting facts and comparisons between the US and Canada, all in the spirit of information, curiosity, and some fun.

By Lauren Kelley | July 1, 2021

The CAC Payback Period, also known as Months to Recover Customer Acquisition Cost (CAC), measures the number of months of subscription revenue it takes to recover the costs to acquire one customer. This metric is one of the many ways to look at the capital efficiency and profitability of a SaaS business.

By Lauren Kelley | June 23, 2021

This time last year, we were all on our 5th, or 20th version of a 2020 operating budget/plan, working 100% remotely, and trying to forecast the rest of the year. Most companies hunkered down, shifted to fully remote sales and marketing, transferred unnecessary travel budgets into other buckets, and conservatively managed expenses.
We’ve published the latest benchmarks incorporating 2020 actuals in our platform and the results are in. Read on to learn about the changes, shifts, and trends we’ve analyzed.

By Lauren Kelley | June 9, 2021

Valuations of private companies are generally a mix of quantitative and qualitative analysis, including market sizing and intangibles, like management team reputation, experience, and network. ​​In this blog, we are looking at the business metrics that can be measured quantitatively and providing a few insights on how investors analyze them.

By Lauren Kelley | May 18, 2021

In today’s final installment, we review the 2021 plans regarding “Hybrid & Remote Work Models for 2021,” and “Office Space Planning” from approximately 100 senior Finance executives in SaaS & cloud companies. As well as key findings from Microsoft’s Work Trend Index regarding hybrid-remote work.

By Lauren Kelley | April 21, 2021

In today’s installment, we review the results regarding the “Top Growth Initiatives for 2021,” “Internal Investments,” and “Strategic Finance Goals” that those surveyed are planning to make. In 2021 competition for customers, product category leadership, and acquiring new employees is expected to be fierce within the SaaS market[…]

By Lauren Kelley | April 14, 2021

In the first installment of this three-part series, OPEXEngine shares the results from our recent SaaS Q1 2021 CFO Pulse Survey, conducted in March. In this post, we analyze the responses to the question:
What Are the Most Significant Factors Impacting the Business Environment for Your Company in 2021[…]

By Lauren Kelley | April 8, 2021

Last week, FLG Partners, a group of experienced CFOs in the Bay Area, put on a webinar called “Pivoting to SaaS: Best Practices, Lessons Learned, and Case Examples” for traditional software and hardware companies. I participated, along with a terrific panel moderated by CFO Eric Mersch, to talk about the lessons learned over the past […]

By Lauren Kelley | February 2, 2021

How COVID-19 has affected Customer Acquisition Cost Calculations A good business practice every year is to review your KPI calculations and adjust for any changes. Right now, this is especially true because of all the changes every company undertook due to the pandemic,  especially moving to remote work and contactless selling to customers. This post […]

By Lauren Kelley | January 27, 2021

If 2020 is remembered as the year of COVID-19, 2021 will be remembered as the year of change. Putting aside everything else that may change, let’s just focus on SaaS in 2021. Cloud and SaaS companies overall benefited from the dramatic shift to digital and remote work in the US and around the world since […]

By Lauren Kelley | January 13, 2021

Each year, we do our best to provide you with valuable SaaS insights and share best practices through case studies, reports, webinars, and blog posts. We also invite other CFOs and thought leaders from the SaaS and Software industry and VC executives to share their content on our blog and provide different perspectives into financial […]

By Lauren Kelley | December 31, 2020

If there is one thing I have learned in my decades of building businesses, it is that KPIs are most useful if you are clear about the goal of the metric. You have to know what the KPI should be telling you in order to understand how to calculate it. If you don’t, you may […]

By Lauren Kelley | November 17, 2020

In the latest edition of our Member Spotlight Series, we spoke with Dominic Ballinger, director of FP&A and Integration at Sage, to discuss how they’ve been affected by the coronavirus pandemic and how BenchmarkEngine™ aids in Sage’s annual planning process.

By Lauren Kelley | October 19, 2020

It’s October—start of Q4 for many, or end of Q3 for some. The 2021 planning process is kicking off or already underway at most companies. Plus, most companies are currently finalizing their Q3 numbers. We took a look at a select group of SaaS companies to see how Q2 differed from Q1 2020 and any […]

By Lauren Kelley | October 7, 2020

As we head into the final stretch of the year, here’s a look at some of the top operational and business trends that we are hearing about. Most SaaS and Software companies are starting to gear up for end of the year budgeting and planning exercises. Part of that exercise requires forecasting both the close of […]

By Lauren Kelley | September 10, 2020

This week, the Mass Technology Leadership Council kicked off the Tech Compact for Social Justice with 60+ leading tech companies making over 180 commitments in their organizations to affect change. In Massachusetts, only 5% of tech occupation workers are African or African/American and 7% are Hispanic or Latino.  According to the Boston Globe, “the tech […]

By Lauren Kelley | August 5, 2020

Second quarter numbers are in and results are mixed.  Overall, companies were up for first half results 2020, but second quarter was tough.   COVID impacted sales for most companies in April and May, with many companies reporting sales coming back in June. We recently fielded a quick survey of SaaS companies to help the SaaS […]

By Lauren Kelley | July 31, 2020

In honor of Canada Day (July 1) and US Independence Day (July 4th), we’ve compiled a few interesting facts and comparisons between the US and Canada, all in the spirit of information, curiosity, and some fun. Demographics: Population: US – 329.8M; Canada – 37.7M (projected for both countries as of July 1, 2020) Over the […]

By Lauren Kelley | June 29, 2020

What a difference a few months makes!  Back in January, 2020 looked so different. By early 2020, investment in the SaaS industry was at record highs and expected to hit even higher peaks.  In early Feb., TechCrunch wrote that VCs were putting an extra $1B into SaaS in 2020, in fewer deals, so more money […]

By Lauren Kelley | June 25, 2020

Every few months I take a look at the top read blog posts on OPEXEngine, to make sure I have a solid understanding of the topics that you are looking for more insight on. And month after month, I see some of the same topics come to the top of the list. As a result, […]

By Lauren Kelley | June 11, 2020

Last week we published the most recent SaaS & Software benchmarks in our platform used by companies in their FP&A analyses for management, boards and investors. We’ve also added more filters by more granular break-outs of revenue, revenue growth rates and Average Contract Value, plus a filter for EBITDA, to help companies better compare themselves […]

By Lauren Kelley | June 4, 2020

Here’s a shout out to Dave Kellogg’s Key SaaS Metrics podcast, recently released on Aznaur Midov’s SaaShimi series.  Dave does a terrific job explaining the current state of the art on important SaaS metrics.  The podcast is an excellent SaaS Metrics 101 listen even for experienced SaaS finance experts. Dave was most recently CEO of […]

By Lauren Kelley | May 22, 2020

I’m delighted to share the first of what will be a regular feature highlighting the OPEXEngine member companies. The purpose of the spotlight series is to offer our members an opportunity to share new initiatives, insights, ideas, and benchmarking best practices with the SaaS and Software finance community. Special thanks to Bobby Jenkins, CFO of […]

By Lauren Kelley | May 14, 2020

In the third of our series of SaaS Quick Polls, we asked the benchmarking community of Software and SaaS companies about whether they expect more employees to be working remotely in the new normal, and how that was affecting office space and office budget plans for the upcoming year.  Approximately 50 companies shared information about […]

By Lauren Kelley | May 7, 2020

Last week, we had a terrific conversation with Jon Lau of InVision and Eric Lundeen from Xero about working remotely as finance professionals. Jon’s company, InVision, has always been 100% remote, no headquarters, no rent.  Eric’s company, the SaaS accounting vendor, Xero, is a publicly listed company in New Zealand and Eric is based in […]

By Lauren Kelley |

We are seeing business planning focus shifting to what the “new normal” might look like once the work from home orders are lifted for non-essential businesses. In the third quick poll in our series, we addressed potential changes to remote working and office space. We heard from members of the SaaS Community that they expect […]

By Lauren Kelley | April 23, 2020

OPEXEngine fielded a second quick poll to the SaaS Finance community between April 2-April 14, 2020 – over 60 individual companies participated, ranging from companies with under 100 employees to companies with more than 5000 employees.  Most of the companies were US and Canadian-based.  The anonymous and confidential poll covered changes to Q2, Q3, Q4 […]

By Lauren Kelley | April 16, 2020

In late March,  we launched a SaaS peer community poll to see what companies are doing in light of the corona virus pandemic’s effects on 2020 budgets.  Approximately 70 unique companies participated, and we pulled together the results here.  Companies ranged from early stage to companies with over 1000 employees, the majority of respondents were […]

By Lauren Kelley | April 3, 2020

The potential business impact of the coronavirus pandemic has resulted in many of you contacting me with questions regarding the rapidly changing financial landscape.   As a result, we launched a series of short online polls, designed to provide real-time insight to help keep us apprised, and inform our forecasting and business decisions. Our first […]

By Lauren Kelley | March 26, 2020

Last week, Mike Volpe, CEO of Lola.com, and I had a terrific, hour-long discussion on the value of a metrics-driven culture at every stage of growth, from early stage to large enterprise. As Hubspot’s CMO, where Mike was part of the founding team through a successful IPO leading to a $2B valuation, to CMO at […]

By Lauren Kelley | March 13, 2020

Imagine that you have just signed an LOI for the acquisition of your company.  You, the CFO of a mid-sized SaaS company have spent the last 2-3 years getting your financials, your retention, CAC and other key metrics, in shape so you are offered an attractive valuation multiple.  Your investors are excited about seeing the […]

By Lauren Kelley | February 27, 2020

A Couple SaaS Generations Ago… Traditional software companies managed sales, product development, finance and HR in siloed organizations by function. Cross functional management was attempted but often not effective. In the early SaaS days, management structure was essentially the same.  Separate Sales, Marketing, R&D, Accounting/Finance organizations were headed by a senior executive. The siloed management […]

By Lauren Kelley | February 13, 2020

The SaaS 2020 outlook for CFOs reminds me of swash (look it up – turbulent water caused by an incoming wave hitting the shore and meeting the outgoing backwash from the previous wave).   More capital invested, more SaaS offerings, continued expectations of rapid growth are running smack into limits on the availability of qualified employees […]

By Lauren Kelley | January 30, 2020

Downward trending cost of goods (COGs) benchmarks are improving SaaS gross margins.  Competitive service offerings and new technologies are driving down costs to maintain SaaS infrastructures. As SaaS gross margins are rising, investors are becoming a bit more savvy about gross margin analysis, with increasing scrutiny of SaaS financials, especially in the wake of the […]

By Lauren Kelley | January 17, 2020

In my last blog of 2019, I’d like to share some of my recent favorite reads. Favorite Reads The Power of Habit by Charles Duhigg “The difference between who you are and who you want to be is what you do.”  Charles Duhigg I had no idea this would be such a terrific book.  It […]

By Lauren Kelley | December 19, 2019

US SaaS companies need to take note of the growing number of world class SaaS companies based outside the US because the international landscape is shifting rapidly.  Increased funding activity in Canada, Europe and Asia/Pac is introducing more non-US competition in the SaaS marketplace.  More and better funded SaaS companies worldwide can be a challenge […]

By Lauren Kelley | December 12, 2019

Last week, Bessemer released interesting new research regarding the return on invested capital.  Three key take-aways from their analysis: Founders and CEOs should evaluate how effectively they are turning their capital into ARR instead of the size of their funding rounds. A new metric, called the Cash Conversion Score (CCS), shows the return on investment […]

By Lauren Kelley | December 5, 2019

During the annual budget and planning process, SaaS Finance leaders focus on making sure that resources are allocated appropriately across the company so the company achieves its performance goals – usually revenue and profitability goals – for the upcoming year.   Resource allocations should be fine-tuned by looking at how the Return on Investment (ROI) can […]

By Lauren Kelley | November 21, 2019

Heading into the 2020 planning season, SaaS FP&A teams are working to finalize 2020 budgets and planning. Over the past decade benchmarking software and SaaS companies, I’ve had the chance at OPEXEngine to work with hundreds of amazing Finance execs who work incredibly hard at getting the right data to support their company’s goals.  I’ve […]

By Lauren Kelley | October 31, 2019

As the close of 2019 approaches, with extreme stock market volatility and mixed economic signals, SaaS Finance execs building plans for 2020 and 2-5 years beyond don’t have an easy time.  What assumptions should you use among conflicting signals about economic and market growth over the next few years? Experts are fairly consistent that global […]

By Lauren Kelley | October 25, 2019

SaaS gross margins have been getting attention lately as investors dig into SaaS cost structures and revenue growth rates going into 2020. Gross margin is simply revenue minus cost of revenue, expressed as a percent.  Gross margin shows what is left over after you deliver your products and services.  SaaS cost of revenue is comprised […]

By Lauren Kelley | October 17, 2019

The Subscription Show is coming to Boston in a few weeks at the World Trade Center.  I’m thrilled to be speaking there about SaaS Metrics and Benchmarks.  The show is 100% focused on subscription models, operations, pricing, marketing and subscription-centric technologies, and organized by Subscription Insider.  I’ll be talking about how investors are evolving the […]

By Lauren Kelley | October 10, 2019

WeWork, a so-called tech company, just pulled its IPO, and a couple of recent high-flying IPOs – Peleton, Uber, Lyft – are trading below their opening prices.  Given market jitters about the economy, very high valuations of some private tech companies, and the massive $s invested by VCs and PE firms in the sector, it’s […]

By Lauren Kelley | October 3, 2019

Have you heard about the Agile Operations Summit happening on November 6 in Boston? If you haven’t, we have four reasons you should attend Lola.com’s Agile Operations Summit. This is the first time a summit of this kind will be bringing together Finance and Operations professionals from all over for a one-of-a-kind conference featuring amazing […]

By Lauren Kelley | September 26, 2019

We often get questions from SaaS companies about GAAP versus non-GAAP expenses, and whether the benchmarks for expenses are distorted by GAAP accounting.  According to GAAP, expenses typically include charges, like stock option expense and other SaaS expense benchmarks which may be associated with acquisitions, and aren’t necessarily relevant to operational budgeting and planning.    GAAP […]

By Lauren Kelley | September 19, 2019

Traditional software companies – and most tech companies in general –  are building Software-as-a-Service (SaaS) businesses.  Enterprise SaaS revenue is hitting the $100B run rate, according to Synergy Research in its most recent report.  That’s still only 20% of the total enterprise software market, but it’s growing quickly. An increasing number of customers demand the […]

By Lauren Kelley | September 12, 2019

Coming to the end of August, we have a fairly mundane topic – the difference between SaaS Bookings and Billings. It seemed like a good idea as the question has come up recently quite a bit. Metrics have no value unless their definition is clear, so it is worth spending a few minutes on the topic. […]

By Lauren Kelley | August 30, 2019

“When you go B-2-B, it’s extremely important you start with the benchmarks. When looking at performance, you start with the best parts of sales and marketing to revenue and then you look at the mix of sales and marketing as percent of total sales and marketing and then you look at your performance versus benchmark, […]

By Lauren Kelley | August 20, 2019

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.

By Lauren Kelley | August 9, 2019

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.  Sales and Marketing gets a lot of deserved attention since it can make or break a company’s revenue growth. Yet, COR spending directly affects the customer and losing […]

By Lauren Kelley | August 2, 2019

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 […]

By Lauren Kelley | July 18, 2019

We wish you a happy 4thof July with best wishes from all of us at OPEXEngine, the only INDEPENDENT SaaS benchmarking platform. In the spirit of the holiday, we’ve collected some 4thof July-related facts (since we love facts and statistics): The Declaration of Independence was signed by 56 men from 13 colonies. Only John Hancock […]

By Lauren Kelley | July 3, 2019

What does it take to achieve extraordinary SaaS B2B valuation multiples?  A big market and performance indicators showing that the company can acquire customers at a fast pace. In addition, it is valuable to show that your company can support/maintain customers with a low cost of revenue.  Even better when your metrics show gains in […]

By Lauren Kelley | June 27, 2019

In this week’s 2019 State of the Internet presentation, Mary Meeker, the Midas List Kleiner Perkins/Bond Capital partner behind Spotify, Dropbox, Instacart, Slack, Square, Airbnb and Houzz, as well as Facebook and Twitter, captured how the internet is transforming the consumer and enterprise world, and even the political and regulatory sphere.   Given at Vox/Recode’s Code […]

By Lauren Kelley | June 14, 2019

Two/thirds of the SaaS Finance executives in this week’s webinar audience said they don’t feel they are getting a high level of return on their R&D investment. Tom Huntington, an experienced SaaS CFO and I explored the R&D “Magic Number,” and how the SaaS model and Lean Start-Up methodologies are helping to make R&D investment […]

By Lauren Kelley | June 7, 2019

Great SaaS companies grow fast and have great products.  Top line growth is the number one priority for most SaaS companies, but what about R&D (Research & Development)? You can’t have fast growth without great products, but often, the link between product development and revenue growth isn’t clear. How do you know if you are getting […]

By Lauren Kelley | May 31, 2019

This week, we announced a strategic relationship with Bain Consulting.  Bain is using our benchmarks with their strategic consulting to help clients better understand how they compare to peers and market leaders, and where they can improve.  Data plus insights makes the analysis concrete and actionable.  Our decade long benchmarking of software and SaaS companies […]

By Lauren Kelley | May 23, 2019

We had a great discussion with Andrew Setness, VP Finance at DialSource this week on evolving the Finance organization as a SaaS company grows.  We talked about the processes, metrics and systems that change as a company goes from a Series A, to B, to C and beyond. Andrew, based in Sacramento, CA, highlighted that […]

By Lauren Kelley | May 10, 2019

Customer Acquisition Cost (CAC) is one of the key SaaS metrics to track and benchmark in your business.  By accurately calculating SaaS CAC and benchmarking it against peers and market leaders, companies can better allocate resources to improve growth and profitability.  And with accurate calculations, companies can identify the most profitable customer segments.  Yet, getting […]

By Lauren Kelley | April 26, 2019

Employees are the biggest asset of a SaaS company as well as the single largest expense.  Compensation & benefits alone represent from 65% to 80%+ of revenue.   With the Enterprise SaaS market generating revenues of $20B a quarter, the venture community continues to pump funds into new and expansion companies. The resulting competition makes it […]

By Lauren Kelley | April 18, 2019

Ever had a discussion or sat in a meeting to review metrics and the meeting didn’t accomplish much because the discussion got mired in questions about the metrics, not what the metrics were saying about the company’s performance? Or your executive team looks at metrics one way, but your investors, bank lenders, or new M&A […]

By Lauren Kelley | April 12, 2019

Alignment between Finance and Sales, especially SalesOps, is critical for SaaS companies to effectively manage growth and expenses.  Miscalculating quotas, attainment and On-target Earnings (OTE) for account executives can drive up CAC, not to mention impact revenues and forecasts. Lauren Kelley and Eric Stephenson, Director of FP&A at Domo discussed in SaaS Conversations this week best practices […]

By Lauren Kelley | April 5, 2019

Just coming back from SaaSConnect, the annual meet-up of the Cloud Software Association (CSA), a terrific conference for SaaS and Cloud business development professionals.  If your partner exec isn’t involved with the CSA, they should be.  The organization is run by a dedicated group of volunteers, ranging from business development at Google and Microsoft to […]

By Lauren Kelley | March 29, 2019

A benchmark floating around the SaaS blogging community is that SaaS net retention rates have to be over 100% – or your company isn’t valuable.  In fact, according to this school of thought, your net retention rate should be way over 100%, at least 125% or more.  Some investors are even associating net retention rates […]

By Lauren Kelley | March 22, 2019

SaaS Sales and Finance collaborate together in planning, forecasting and day-to-day Sales management issues.   That collaboration can be smooth and extremely productive, or there can be less productive friction.  Working with hundreds of SaaS and software Finance organizations to collect and benchmark key Sales-related metrics, we’ve seen some best practices that tend to make the […]

By Lauren Kelley | March 16, 2019

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 […]

By Lauren Kelley | March 8, 2019

Ever had a discussion or sat in a meeting to review metrics and the meeting didn’t accomplish much because the discussion got mired in questions about the metrics, not what the metrics were saying about the company’s performance? Or your executive team looks at metrics one way, but your investors, or bank lenders or new M&A […]

By Lauren Kelley | March 1, 2019

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 […]

By Lauren Kelley | February 15, 2019

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 […]

By Lauren Kelley | February 12, 2019

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.  […]

By Lauren Kelley | February 8, 2019

SaaS companies selling in the SMB market are structured operationally very differently from SaaS companies selling in the enterprise market.    Everything from Sales structures to Marketing to R&D is organized differently depending on whether you are selling a low-priced product to a high volume of customers, or selling a high-priced product to a smaller number […]

By Lauren Kelley | February 1, 2019

Driving revenue and revenue growth is one of the most important factors in the financial performance of a SaaS business, so getting the sales and salesOps metrics right is critical. In fact, for 2019, this might be one of the most important financial benchmarks you should track. We had a great webinar with SaaSOptics and […]

By Lauren Kelley | January 27, 2019

CAC can be difficult to calculate.  If you have 1000 customers paying $1,000/year plus 100 customers paying $10,000/year, is it good, bad or indifferent if your average CAC is $5,000/customer?  In the B2B SaaS world, most companies have different customer segments who pay somewhat or very different prices based on a variety of different licensing […]

By Lauren Kelley | January 17, 2019

Too many SaaS companies don’t have a strategic systems roadmap to support their growth.  As a result, they end up making endless tactical fixes and integrations to solve immediate problems but continue to struggle producing key reports and data analysis. In a recent OPEXEngine webinar, SaaS CFO Eric Mersch (Percolate and FLG Partners) and OpFocus […]

By Lauren Kelley | January 7, 2019

It’s the end of the year, and it’s time for us to make some predictions going into 2019. Here are the top five things we think the SaaS Boards are thinking about going into 2019. Top Five Things SaaS Boards are Thinking About Going Into 2019 1) Large tech cos are consolidating and driving M&A […]

By Lauren Kelley | December 21, 2018

Yesterday, at the Boston SaaS Finance Meet-Up for the SaaS and Software benchmarking community, we discussed some of the issues with determining customer count for B-2-B SaaS companies.  Last week, the same question came up at our San Francisco SaaS Finance Meet-Up as well, so it is clearly an issue.  Many companies, especially those selling […]

By Lauren Kelley | December 14, 2018

Best in class SaaS CFOs measure the percent of R&D spend associated with tech debt, just like they track financial debt.  Tech debt simply defined is the accumulated cost of development short cuts and outdated technology.  It is the interest a company pays for trade-offs made between quality and time to market – short cuts […]

By Lauren Kelley | December 7, 2018

Savvy SaaS CFOs know that the best way to prepare for board approval of the next year’s budget and plan is to set the stage before the meeting.   This is the time of year when most SaaS companies are compiling and finalizing budget numbers. The hard work of getting Executive team agreement on the final resource […]

By Lauren Kelley | November 30, 2018

A really smart and experienced investor said to me the other day that with these 3 things, he could absolutely increase any SaaS company value (and would invest in doing so): The right operational data about the company and good, comparable benchmarks, Intelligent interpretation of the data, especially around go-to-market Improved business processes focused on […]

By Lauren Kelley | November 16, 2018

Every vendor, from early to enterprise stage, must have a laser focus on SaaS cash management in order to survive.  The lag times caused by the subscription payment model, PLUS the intense customer acquisition growth pressure in order to succeed in the market, makes cash burn tough to manage. In SaaS, spending cash usually comes […]

By Lauren Kelley | November 9, 2018

Earlier this week, we published a blog by Tomasz Tunguz, How the Economics of Professional Services Have Changed in Software. He demonstrates that professional services strategies and gross margins vary widely across public SaaS companies and have done for some time in the SaaS world. Despite large variances in professional services metrics, public SaaS companies […]

By Lauren Kelley | November 1, 2018

The OER (Operating Expense Ratio – ratio of operating expense to revenue) is a traditionally viewed as a measurement of efficiency. It can be translated to mean the dollars required to produce one dollar of revenue.  Typically, that dollar of operating expense was 90 percent payroll components. For early stage companies, the OER may be 3X.  […]

By Lauren Kelley | October 25, 2018

Employee productivity is an oft overlooked performance benchmark in fast growth tech companies. It is easy to calculate – divide revenue by number of employees.  The calculation is the same regardless of the business model.  The simplicity and consistency of how the metric is calculated is attractive and helpful in calculating the revenue potential of a […]

By Lauren Kelley | October 4, 2018

Harvard Business Review published an article last year describing a new method they dubbed the Customer Based Corporate Valuation (CBCV) method focused on SaaS valuations and subscription companies. CBCV takes a “bottoms-up” approach to determining a company’s value, focusing on its customer base and the value of its customers.  By contrast, traditional valuation methods take a […]

By Lauren Kelley | September 27, 2018

For SaaS companies targeting fast growth to $100M and beyond, the company’s data management of its own business information can enable the growth path or bog it down.   Manual and “heroic” efforts to get the data out of business systems for reporting and analysis will get harder and harder to do as systems, records and […]

By Lauren Kelley | September 20, 2018

You hear the terms SaaS, subscription, term licenses and perpetual license software tossed around frequently.  The terms aren’t universally understood, nor are the implications of each on the financial model of a company, so the following is an effort to provide an overview. At OPEXEngine, we pull apart the different nuances of each business model […]

By Lauren Kelley | September 13, 2018

Good SaaS CFOs manage increasingly complex organizations and responsibilities.  The Finance organization has grown to be one of the strategic assets of a SaaS company, managing the  numbers, planning for growth, contributing to strategic changes in Sales, Marketing and even R&D, not to mention closing the books every month, quarter and year. SaaS Finance:  One […]

By Lauren Kelley | September 5, 2018

In honor of the last, hot days of summer and our love of Labor Day data and statistics, we dedicate this content to Labor Day in the U.S. on Sept. 3rd. The first observance of Labor Day was likely on Sept. 5, 1882, when some 10,000 workers assembled in New York City for a parade. […]

By Lauren Kelley | August 29, 2018

Fifteen years ago, software company financial plans followed standard guidelines about sales and marketing expense targets. Traditional software sales and marketing expense aimed for 22%-25% of revenue, maybe 28-30% if strong revenue growth warranted it.  Anything north of that required a really good explanation for why and how the numbers would be reduced.  SaaS financial […]

By Lauren Kelley | August 17, 2018

In 2007, when OPEXEngine launched its first benchmarking of SaaS vendors, almost no SaaS companies in the data set were selling to end-user customers through a channel. Over a decade later, that statistic has changed dramatically. In the early days of SaaS, the idea was that subscription pricing did not allow a partner margin, so almost […]

By Lauren Kelley | August 7, 2018

Hiring and retaining skilled and productive employees in SaaS companies is an ongoing, competitive exercise.  Human assets are the biggest investment and a huge driver of SaaS company valuations – but a lot of organizations don’t check SaaS HR benchmarks regularly or keep it in front of management the way they do customer lifetime value, […]

By Lauren Kelley | July 31, 2018

The SaaS IPO and M&A market is extraordinarily strong.  Venture and PE capital inflows to SaaS companies also continue to be strong. With the second half of 2018 approaching for most SaaS and software companies, it is time to review and tweak second half budgets and plans. Now is a great time to benchmark your KPIs […]

By Lauren Kelley | June 26, 2018

Growth is the primary driver of value for early- and mid-stage SaaS companies.  In subscription models, you invest in revenue acquisition up – front and then generate value over time by managing churn. Acquiring new recurring revenues burns cash, mostly in Sales and Marketing. SaaS executives need to understand how efficient their organizations are in […]

By Lauren Kelley | June 19, 2018

Over the past 12 months, a number of our benchmarking customers have either filed or completed SaaS IPOs. And Adaptive, a customer and partner, filed for an IPO in May and then announced in a surprise move on Monday its acquisition for $1.55B by enterprise SaaS company Workday for more than double (2.2X) the expected post […]

By Lauren Kelley | June 12, 2018

SaaS companies track the monies earned for selling products and services with a variety of different metrics, and it can be confusing.  Some companies track bookings, ARR and recognized revenues, others include billings.  Each of those metrics represents a different way of looking at the money coming into a company.  Some companies only include recurring […]

By Lauren Kelley | June 5, 2018

Intelex, a Canadian-based global leader in Environment, Health, Safety and Quality (EHSQ) SaaS, with offices in Toronto, Denver, and the UK, uses OPEXEngine’s SaaS Benchmarking platform, BenchmarkEngine™, together with Adaptive Insights budgeting and planning solution to drive operational analysis enabling fast growth. Intelex has grown to 500 employees with global offices and over 30 percent […]

By Lauren Kelley | May 29, 2018

Company X is a fast growth SaaS company, surpassed $20M ARR in 2017 and on a plan to hit $35M ARR in 2018, and $50M ARR in 2019.  Their growth plan is based on: more enterprise customers; opening an office in Europe/UK and increasing European revenue to 15% of total revenue; and adding new functionality […]

By Lauren Kelley | May 21, 2018

Last week, Hubspot announced strong Q1’18 results of 39% revenue growth and 44% customer growth.  These are great growth numbers, but more importantly, Hubspot announced a major evolution in its growth strategy. Here is how one successful SaaS vendor is evolving its model. Hubspot invented and evangelized the term “Inbound Marketing,” dramatically influencing the SaaS playbook […]

By Lauren Kelley | May 15, 2018

Sales is the revenue engine of any B-2-B SaaS company and thus absolutely critical to company growth. Sales is also often the biggest single departmental expenditure in the company – another reason why Sales efficiency is critical to ensure companies are getting the best productivity for their investment in the Sales organization and everything the company […]

By Lauren Kelley | May 8, 2018

SaaS G&A expense is surprisingly high.  Unlike traditional software companies where G&A expense was expected to be in the 12-14% of revenue range at the time a company went public and then drop to 8-10%, SaaS companies present G&A expense between about 15% to 20%, and sometimes more, of revenue.   Why is this and what […]

By Lauren Kelley | April 30, 2018

Subscription revenue management SaaS vendor Zuora’s IPO on Thursday, priced at $14, closed at $20 and valued the company at $2B.  2018 is shaping up to be a banner year for B-2-B SaaS IPOs:  Dropbox and Zuora already have listed, Docusign, Pluralsight, Smartsheet have filed and Qualtrics, Apttus, Github, SurveyMonkey and Slack are expected to […]

By Lauren Kelley | April 17, 2018

Women in tech are becoming more common every single day, but there is still significant disparity when it comes to what salaries are being offered to women versus men for the same technology jobs.  Hired.com recently released their third annual report, The State of Wage Inequality in the Workplace. Hired.com is a tech hiring marketplace […]

By Lauren Kelley | April 11, 2018

Pricing in the SaaS world is particularly complicated. Pricing can make or break your SaaS company with its impact on both profitability and revenue growth – the two major indicators of company valuation. SaaS pricing is a fast-moving target and every SaaS CFO should be re-evaluating their company’s pricing on a regular basis.  As a […]

By Lauren Kelley | March 19, 2018

OpFocus recently met with fellow SaaS maven & long time friend, Lauren Kelley, who founded OPEXEngine a decade ago in Waltham, MA and built it into the premier Software as a Service SaaS benchmarking resource. Lauren’s held executive positions of her own in some of the industry’s most successful companies, and having advised hundreds of forward-thinking technology […]

By Lauren Kelley | March 11, 2018

Last week, Salesforce.com (CRM) announced their FY 2018 results. The data indicates strength of their expansion model. Here’s why. SaaS companies, as well as investors in SaaS, watch Salesforce the original pioneer of the SaaS model.   The “No Software” company is the largest fast growth SaaS company in the world, keeping the momentum going even […]

By Lauren Kelley | March 4, 2018

The importance of unit economics and the associated metrics (CAC, LTV, LTV/CAC ratio) is well established in the SaaS world.  But how you calculate your operating numbers isn’t as well understood – these critical non-GAAP metrics aren’t consistently defined.  And changes in calculations – not the business – can have a real impact on your […]

By Lauren Kelley | February 27, 2018

Coming back from the annual SaaStr mega conference in San Francisco, it is clear that SaaS is huge, it is expanding and it is going to impact companies both in the United and States and abroad. The Expanding SaaS Sector The rapidly expanding SaaS sector numbers something like 10,000+ revenue-earning vendors.    While the majority of […]

By Lauren Kelley | February 19, 2018

One of the hottest trends in the evolving SaaS playbook is the influence of Account-Based Selling (ABS) and Account-Based Sales Development (ABSD). The Account-Based approach changes two important aspects of growing a SaaS company:  firstly, it changes business processes, and secondly, it changes organizational structures.  The focus is to pull together Marketing, Sales, Customer Success, […]

By Lauren Kelley | February 12, 2018

I’m jazzed to spend this week at SaaStr 2018 annual mega conference & SaaS gathering in San Francisco.   Over 10k + founders, VCs, and execs will be participating in the 3-day conference. The organizers have focused on including women and “under-represented” groups—40% of the speakers are women and 60% altogether between women and under-represented groups.  […]

By Lauren Kelley | February 5, 2018

2017 was a banner growth year for SaaS companies, and particularly for SaaS vendors that went public over the past 12-18 months.  Based on OPEXEngine’s data feed of analyst revenue expectations for the next fiscal year filings, top performing SaaS companies’ annual revenue growth rates keep climbing and it appears as if they will beat […]

By Lauren Kelley | January 29, 2018

SaaS companies are all about fast revenue growth and great products.  Most discussions about SaaS models focus on Sales and Marketing – in fact we wrote a post about it last week, but what about R&D (Research & Development)? You can’t have fast growth without great products, so how do you measure SaaS R&D performance?  We […]

By Lauren Kelley | January 22, 2018

Last week we looked whether all SaaS companies benefited from the incredibly hot stock market in 2017.  We found big variations in Market Cap to Revenue multiple trends.  Some companies doubled their market valuation multiple during 2017, and some at the bottom of the spectrum reduced their multiple by almost half.  This week we’ll look […]

By Lauren Kelley | January 16, 2018

2017 was a successful year for Cloud companies. At the same time, the stock market hit historic highs – the Dow increased by 25% and NASDAQ increased by 28%.  We noticed some interesting trends regarding which companies benefited the most from market cap valuation increases in 2017. Why did some SaaS companies get an incredible […]

By Lauren Kelley | January 7, 2018

Adaptive Insights and OPEXEngine announced an agreement that underscores the companies’ joint commitment to providing best-in-class benchmarking data to software-as-a-service (SaaS) and software companies. AdaptiveInsights, the leader in strategic corporate performance management (CPM), and OPEXEngine, the principal independent benchmarking platform for software and SaaS companies, can now better serve their mutual customers’ needs.  Under terms […]

By Lauren Kelley | August 14, 2017

Are we any good at SaaS product investment? No, not really.   I looked at 145 public and private SaaS companies with revenue of $5 million and greater in conjunction with the team at OPEXEngine.  Our goal was to find a relationship between product spending and payback once companies achieved product market fit.  What happens […]

By Lauren Kelley | June 26, 2017

Most SaaS companies know that to run your business profitably, it is important to measure SaaS CAC.  Yet, managing this metric over time can become increasingly complicated as a company expands its operations and divides its resources into both acquiring and retaining customers.  Calculating SaaS CAC correctly is not as simple as dividing total Sales […]

By Lauren Kelley | March 1, 2017

  We are frequently asked “how are companies allocating Customer Success expense” and where does the Customer Success organization sit among peer companies.  This issue often comes up among SaaS finance executives at the SaaS Finance Meet-UPS that OPEXEngine runs.  I’ll share some of what we’ve seen here.   We will continue to be working this evolving […]

By Lauren Kelley | January 25, 2017

The SaaS business model requires the integration and coordination of far more operations than traditional software models.  R&D, Sales, Marketing, Customer Success, Finance, and Operations all need to work together to produce profitable unit economics which are the basis of a successful SaaS company.  The annual budgeting practices process is a methodical way of allocating […]

By Lauren Kelley | November 22, 2016

Does your company provide free food for all employees every day or just on Wednesdays? Concierge services?  FastPass payments?  Free beer and wine?  Doggie day care?  Massage, acupuncture – the list goes on.  Tech companies large and small provide some of the most extensive company employee benefits for their employees in the competition for the […]

By Lauren Kelley | October 28, 2016

On the last day of August, as we go into the final stretch of Q3 and 2016, SaaS valuations are evolving.  Benchmarking the financials and operating metrics that drive these valuations is what OPEXEngine, the member-based benchmarking community for SaaS companies, is all about. Forward multiples have rebounded for companies maintaining strong revenue growth at […]

By Lauren Kelley | August 31, 2016

About 3/4ths of Sales expense is spent on sales compensation. Companies have always spent huge amounts of time and resource fine tuning their sales structure and organization but in the SaaS world, it is even more complex.  SaaS companies have to compensate for recurring revenues, renewals, find the right mix of incentives, targets and sales […]

By Lauren Kelley | June 30, 2016

Every CFO conference that I’ve been to in the past 5 years stressed the emergence of the CFO as a strategic leader of the company.  Study after study affirms that today’s CEOs expect CFOs, especially in the tech sector, play a strategic role driving company growth rather than just accounting for past performance and policing company […]

By Lauren Kelley | May 18, 2016

There are millions, okay, hundreds, of benchmarks floating around these days.  Sales productivity should be a, b or c funnel conversion rates are typically such and such a percent, or churn rates have to be no more than x or your company is in big trouble.  Whatever the metric, someone has a definitive answer for […]

By Lauren Kelley | March 29, 2016

Who does sales ops report to within your organization? According to Lauren Kelley, your company’s sales ops may be sitting in the wrong department. Kelley is the CEO and Founder of OPEXEngine, a member-based SaaS benchmarking company. She was previously the SVP of sales and operations at ATG, later acquired by Oracle, and also spent two […]

By Lauren Kelley | March 23, 2016

If a company can sell 1.5 deals in the time it previously took to sell one deal, you have 50% more revenue.  All other things being equal (ie., you don’t increase churn, increase discounting, etc), if you tighten up your sales cycle, you’ll increase revenue. There’s a fair amount written on SaaS sales cycle lengths […]

By Lauren Kelley | February 29, 2016

Benjamin Graham, father of value investing, famously described the stock market as a “voting machine.”  His star protege, Warren Buffett, would later expand that to “a voting machine over the short term, and a weighing machine over the long term.”  What the heck was Graham talking about, and why did Mr. Buffett feel the need to […]

By Lauren Kelley | February 8, 2016

Will risk adverse investors in both the private (VC and PE) and public markets this year impact SaaS operating benchmarks like revenue growth, profitability, hiring and a host of other operating metrics in 2016?  We’ve been getting calls from a number of saavy CFOs asking to see SaaS operating benchmarks from 2009 and 2010, just […]

By Lauren Kelley | January 28, 2016

In a recent forum dedicated to software and SaaS Finance leaders, organized by the SIIA and sponsored by OPEXEngine, Netsuite, Intacct and Grant Thornton, one of the best discussions dealt with preparing for and managing the optimal M&A exit for your company, with CFOs from acquired companies and M&A advisors from Grant Thornton. Key Takeaways: […]

By Lauren Kelley | December 22, 2015

We frequently have customer conversations where we discuss how things are moving around a SaaS income statement;  hosting costs into COGS, headcount from R&D to other departments, things like that.  Meanwhile, in another part of The Cloud, there are some large, important blocks of capital moving between  a companies balance sheet. The form of the capital is data […]

By Lauren Kelley | November 23, 2015

Tech companies are all about innovation – how obvious is that?  And how well you run your R&D innovation and processes is a major determining factor in a company’s success, no more so than in the fast moving world of SaaS technology.  No matter how good your Sales and Marketing functions are, they need to […]

By Lauren Kelley | October 28, 2015

Annual Study Finds Private Software Industry and SaaS Firms Seeing Strong Growth,  More Hiring and Significant Venture Capital Flow. One year after reporting that private U.S. software companies saw the largest revenue gains since the recession of 2008, the 2015 Software & SaaS Industry and Benchmarking Report shows even greater acceleration in topline growth. Announced today, […]

By Lauren Kelley | September 29, 2015

The recession of 2008 took its toll on many different industries and the software industry was certainly no exception. With the recent release of the 2015 Software & SaaS Industry and Benchmarking Report on Sept. 10, produced by OPEXEngine, in partnership with the Software and Information Industry Association (SIIA), it was revealed that the software […]

By Lauren Kelley | September 24, 2015

We announced recently that average annual revenue growth for the fastest growth private SaaS companies had jumped from last year’s median of 100% to this year’s 150% annual revenue growth.  The press release got a lot of attention and was reported in InfoWorld, ZDNet, CPA Practice Advisor and the Kiplinger Letter, among others.    How […]

By Lauren Kelley |

Bomgar is a venture-backed, mid-sized software vendor which has ranked in the Deloitte Technology Fast 500 for the past 4 years.

By Lauren Kelley | September 10, 2015

The tagline for General Catalyst Partners is “entrepreneurs investing in entrepreneurs,” and partners of the active venture firm are well known for lending deep operating experience to their portfolio executives’ growing businesses.  I’ve known Larry for years since we were both operating executives at various software companies.  Here’s his take on the key operating metrics that […]

By Lauren Kelley | September 9, 2015

Rally Software, based in Boulder, CO, is the leader in Agile Application Lifecycle Management (ALM) and IPO’ed April 2013.

By Lauren Kelley |

Financial results for the Class of 9 B2B SaaS companies that IPO’ed in 2014

By Lauren Kelley | August 19, 2015

Even a 1% improvement in renewals can drive significantly higher valuations for a SaaS company over time

By Lauren Kelley | July 17, 2015

With any analysis, it is only relevant if you understand how the data was calculated and the context of how it relates to your business.  The data has to be credible for the analysis to be useful. And when comparing to benchmarks, it becomes doubly important to make sure that both the benchmarks are credible and […]

By Lauren Kelley | May 22, 2015

The social media world and business advisory firms, consultants and other pundits keep alerting businesses that the objective of return on investment (ROI) is diminishing in importance, or even dead, due to the increasing focus on return on user experience (ROE or ROX). We asked three experts to share their advice on ROI versus ROE as […]

By Lauren Kelley | May 5, 2015

OPEXEngine and the SIIA’s annual SaaS and Software benchmarking encompasses valuation models, sales and marketing operations, HR and employees, R&D, product and hosting, plus professional services (consulting) and customer service, launches April 7. The Software & Services Division (SSD) of the Software & Information Industry Association (SIIA), the principal association representing the software and digital content […]

By Lauren Kelley | April 17, 2015

COGs are the second highest expense bucket for most SaaS companies.  If you aren’t continuously delivering problem-free, high speed and secure access to your SaaS product, customers won’t stay.   Delivering high performance to an exponentially growing subscriber base costs a lot, which drives up COGs.  In addition, you need to invest in your hosting […]

By Lauren Kelley | March 18, 2015

Learn about the Sales and Marketing efficiency Magic Number benchmark in the 2015 benchmarking.  Like the benchmarking of any key metric, you will drive operational efficiency and better use of your resources, when you see the variance between your company and your peers at the same stage and with a similar business model.  You can […]

By Lauren Kelley | February 23, 2015

After 8 years working with hundreds of SaaS and software companies (and about 60% of the SaaS IPOs over the past 5 years), one of the key ways that growth companies use our benchmarking data and services is for planning and budgeting. Planning and Budgeting Almost all of our clients use benchmarking to plan their […]

By Lauren Kelley | January 28, 2015

In the following Q&A, Lauren and David share lessons from each of their 25 years of technology management, tailored for SaaS companies on how fast growth SaaS companies are using key metrics to grow their businesses. Q: What are the do’s and don’ts in building a successful SaaS company? Lauren: SaaS is more complex and […]

By Lauren Kelley | December 22, 2014

2015 is fast approaching and it will be a big growth year for software and SaaS companies.  Here’s OPEXEngine’s predictions about how SaaS business models will evolve in the new year, as well as Nicholas Negroponte’s always insightful thoughts about future trends.    OPEXEngine’s  Business Model Predictions for 2015 “Winner take all” competition for market […]

By Lauren Kelley | December 15, 2014

I recently attended the 12th Annual MIT Sloan CFO Summit, which, as always, was great.  The title, the Future Forward CFO, articulated the theme that CFOs have moved from reporting the past to helping shape their company’s future.  A CFO’s position has grown beyond reporting accurate financial statements and historical analysis to proactive strategic planning, […]

By Lauren Kelley | November 25, 2014

Professional services for many SaaS companies have become an important way to on-board customers, keep customers satisfied with the product and using more features of an application or service, making it stickier.  As one CFO recently said, professional services are definitely a churn-reducer.  SaaS companies, particularly high growth, venture-backed firms, are pricing professional services as […]

By Lauren Kelley | November 12, 2014

Borrowing from the basics of Six Sigma, keep the following in mind as you define and manage your SAAS performance management and benchmarking: 1. Define the metrics All metrics should be clearly defined so that an organization can benchmark its success. One way to keep metrics understandable is to use the SMART (specific, measurable, achievable, […]

By Lauren Kelley | October 27, 2014

The private U.S. software industry is experiencing its biggest revenue gains since the recession, and both private and public companies are renewing their focus on investment in order to gear up for further growth, according to a study announced today by the Software & Information Industry Association (SIIA), the principal trade association for the software […]

By Lauren Kelley | July 18, 2014

Tracking performance metrics like monthly recurring revenues (MRR) and contracted monthly recurring revenues (CMRR), customer acquisition costs (CAC), renewal or churn rates, and customer lifetime value rate (CLV) is critical for driving growth at successful SaaS companies.  None of these metrics are GAAP metrics, though, and there is no auditing of the numbers.  Many companies […]

By Lauren Kelley | May 21, 2014

Last week’s “Deciphering Finance” conference in Irvine, California, organized by the SIIA was a great forum for sharing best practices among Finance leaders and peer networking.   I thought one of the many useful sessions was the discussion between an experienced CEO and his CFO which captured some of the key issues in that relationship.  Here’s […]

By Lauren Kelley | May 6, 2014

Security and performance investments, among other items, are driving up Cost of Revenue for SaaS growth companies. The ultimate goal of a subscription business model is to reduce the cost per subscriber and increase profitability. That does not mean, however, that cost ratios follow a smooth downward trend as revenues grow. 10 years after Salesforce.com went […]

By Lauren Kelley | April 8, 2014

order essay online Annual Study Finds SaaS Driving Largest Revenue Gains, and Indications of Growth Outside Silicon Valley, Massachusetts & Other Traditional Tech Centers. Small and mid-sized companies in the U.S. software industry are thriving in the post-recession economy, with software-as-a-service (SaaS) firms consistently experiencing the greatest revenue growth and hiring expectations, according to a study […]

By Lauren Kelley | October 17, 2013

Imagine this scenario:  your company is relatively healthy and becoming established in the market but needs to keep up a fast growth pace or maybe even to grow faster.  Your heads of sales and marketing suggest that the best avenue to growth is that you need to add headcount in their respective departments.  Hard to […]

By Lauren Kelley | July 8, 2013

Render unto Caesar … I recently met with a client CFO of a $100M software (not SaaS) company and in the course of our conversation she repeated a question her CEO had put to her recently: “Why do we pay so much in taxes; why can’t we pay something more like what GE pays?” It […]

By Lauren Kelley | May 7, 2013

I recently spent two full days at a Retail Analytics and FP&A conference, which was terrific for many reasons. Retail FP&A (Financial Planning and Analysis) folks are very innovative in tying customer behavior to financial performance indicators. We in the software industry are true babes in the woods compared to retail companies on this one, […]

By Lauren Kelley | March 17, 2013

Good news for sales and marketing executives defending their budgets if they are planning on going public soon: The total amount of money in the sales and marketing budget probably isn’t going to be questioned too much. That doesn’t mean that how they spend their money isn’t going to be questioned, or the effectiveness of […]

By Lauren Kelley | March 5, 2013

SaaS Cost of Customer Acquisition (COCA) is one of the most critical SaaS metrics in determining whether a SaaS business is building a profitable business or not. COCA includes all sales and marketing expense aimed at bringing on new customers. In small and midsized companies, COCA is typically calculated as all sales and marketing expenses from a […]

By Lauren Kelley | February 24, 2013

Every SaaS business wants to have very low churn rates. Public SaaS companies often release renewal rates in the mid- or even high 90 percent range, without giving any detail about how the number was derived. But how do you interpret SaaS churn metrics? In our annual Software and SaaS benchmarking, we’ve been tracking churn […]

By Lauren Kelley | February 18, 2013

If you are a SaaS company, you surely watch customer churn rate like a hawk.  When your company is working hard to add new customers, and then losing a good portion of them every year, that’s a bad thing.  It says a few things about your business: You may not have as good customer relationship […]

By Lauren Kelley | April 23, 2012

Fast-growing software and SaaS companies don’t navigate their growth by luck. Successful companies today are intensely metrics driven and constantly compare their performance to peers and market. Have you ever felt that critical executive or board-level decisions about sales spend, performance targets and other business drivers are based on anecdotes and emotion more than data? […]

By Lauren Kelley | March 25, 2012

get ex back Most companies are now preparing their 2012 budgets and going through the approval process. To say the least, few people enjoy the budget process. It is often long and drawn out to the point where many managers involved in the process are just relieved that it is over, regardless of whether they […]

By Lauren Kelley | December 13, 2011

We’ve been tracking COCA for SaaS companies for about 5 years now.  We use the metric to calculate benchmarks for customer acquisition expense by size of company, and by type of product offering, ie., whether a company is selling a low cost solution or a relatively high cost solution.  We incorporate COCA into other benchmarks […]

By Lauren Kelley | November 15, 2011

I thought it would be worthwhile to publish an interview I did earlier this year with Mike Morgan, CFO of Bomgar Corporation talking about benchmarking value and how it has worked for them.  Bomgar is a venture-backed, mid-sized software vendor which has ranked in the Deloitte Technology Fast 500 for the past 4 years.  With […]

By Lauren Kelley | June 15, 2011

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