VC Views


Business operates in a climate of constant change. Here’s how you can make your planning and budgeting process more Agile.

By Bain & Company | August 24, 2021

As companies commit to transforming their FP&A function, choosing the right focus and pace is essential. They should align with business leaders on the sources of value creation for the future, then work backward to redesign FP&A around them. And they should carefully choose their spots for investment. That will raise the odds of FP&A shifting its role from scorekeeper to a true business partner.

By Bain & Company | August 3, 2021

Where is the SaaS world relative to how far it can go? With valuations of as-a-service companies and all-time highs or close to it, and more and more startups leveraging this model to serve an ever-larger number of consumers, I wondered how much more business is there to capture? Let’s try to estimate. We do […]

By Tomasz Tunguz | March 3, 2021

If the shelter-in-place order were to remain in place for another 12 months, how would you change the way you run your business? Over the past two months, CEOs and founders have managed the turbulence imposed by the coronavirus onto their companies. Most of the time, we’ve implemented short-term plans. This week, the first companies […]

By Tomasz Tunguz | May 26, 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

As Chief Credit Officer at Lighter Capital, I work behind the scenes grappling with the data that informs all of our decision-making regarding financing deals, from revenue-based financing (RBF) to term loans and lines of credit. Similar to a venture capitalist (VC), I try to understand where startups are in their life cycles — and where they can expect to […]

By Lighter Capital | January 28, 2020

SaaS multiples look great and made a nice comeback from Q4 2018: of the 72 SaaS companies we follow, the average public SaaS business is trading at 10.51x revenue while the median is 8.94x. Interestingly, the gap between the average and median has never been larger for the time period shown, meaning more attractive SaaS companies are being rewarded with big premiums.

By Sammy Abdullah | October 8, 2019

You’ve found product market fit. You’ve hired a team, including some managers. Your initial, small customer base is very happy. You’ve discovered an initial channel of customer acquisition that’s working. You’ve raised a meaningful round of capital. And then, right then, product innovation decelerates to zero. The fast pace that characterized the past 12-18 months, […]

By Tomasz Tunguz | September 10, 2019

What valuations are founders asking for when they raise their Series A? Since May 2018, we’ve had conversations with 329 companies about their Series A rounds.  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 […]

By Sammy Abdullah | July 30, 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

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. […]

By Sage Intaact | July 9, 2019

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 […]

By Tomasz Tunguz | July 2, 2019

A few days ago I wrote that there’s more than one path to $100 million. I argued that while it’s awesome to see that some companies are able to get from 0 to $100 million in ARR in 7-8 years or even less, trying to grow that fast may not be the best choice for […]

By Christof Janz | March 12, 2019

Today’s syndicated article was written by Sammy Abdullah, Co-Manager at Blossom Street Ventures. The chart below is a good set of data from recent SaaS IPOs and their R&D spend. 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 […]

By Sammy Abdullah | February 26, 2019

Here are some predictions for 2019 and a review of my thoughts for 2018, many of which were wrong. The M&A market slows meaningfully, especially at the multi-billion dollar level. The recent seasickness in the public markets forces most CEOs adopt a more conservative approach to acquisitions. Facing large swings in valuation, these leaders may […]

By Tomasz Tunguz | January 8, 2019

Raising capital can be a challenging, sometimes grueling, process. In the last 20+ years, I have seen how the sausage is made from many different perspectives. Prior to starting SaaS Capital in 2007, I was a partner at a venture capital firm with a focus on funding Series A and B for software companies. It […]

By SaaS Capital | December 26, 2018

Your startup is just getting off the ground. You might have a few account executives and a sales leader in place; maybe some revenue and a handful of customers. The sales team costs real money, and the question before the company is: how do know what quota plan to assign to the account executives? I’ve […]

By Tomasz Tunguz | November 27, 2018

A founder asked me recently if there were any trends in the economics of professional services across public SaaS companies. I had examined the gross margins and share of revenue from professional services about 3 years ago. Professional services are consulting fees software companies charge to customers for software configuration, customization and education. What has […]

By Tomasz Tunguz | October 30, 2018

From time-to-time, you may need to find consultants to help you with your business.  Sometimes, those needs are high level, like setting strategies or marketing plans.  And, other times, those needs are more point solutions, like a pro in search engine optimization or product sourcing.  Whatever your need may be, there is most likely a […]

By George Deeb | October 23, 2018

In early markets, customers prefer entire solutions, not best in class point products. These solutions often include significant professional services and education. At the beginning of a new wave, most customers don’t understand the technology well. So, they seek experts to guide them. Companies that provide services and education often win the early market. They […]

By Tomasz Tunguz | October 18, 2018

I’ve written quite a bit about the public market software multiples. They’ve increased to near historic levels with forward revenue multiples approaching 9x. As the public markets have appreciated, something has happened that I didn’t expect. Some public companies are now fetching the mulitples of the most attractive private companies. I thought valuations between the […]

By Tomasz Tunguz | October 10, 2018

Recently, people have been asking just where are we in the SaaS valuation cycle. I last updated the chart above more than six months ago. The answer is close to ten year highs. The chart above shows the median enterprise value to forward revenue multiple to multiple. Enterprise value is the market of a publicly […]

By Tomasz Tunguz | July 19, 2018

There are five forces driving the startup ecosystem today. They are working together to reinforce a high valuation environment. These forces are: An infusion of capital into Startupland. There are many reasons for this. The money supply in the US has doubled in the last 10 years. A low interest rate environment means a low […]

By Tomasz Tunguz | June 21, 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

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

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

By Lauren Kelley | August 19, 2015

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

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