SaaStr

MARCH 31, 2021

from 2015 to 2016 … and then exploded: UIPath History. 2016: $3.5m Top 50 customers grew bookings 81x since 2016, and all 2016 customers together grew 57x. These 2016 customers really leaned in on UiPath. And then after a decade … it started to come together. 2014: $500k rev. seed round. 2015: $1m rev.

Outsourcing Services 362

Outsourcing Services Outsourced Development Payment Features Cloud 362

Tom Tunguz

OCTOBER 12, 2022

Enterprise-value-to-forward-revenue multiples are now below 2016 levels for the first time in 6 in years. It happened in Feburary 2016. The public software market continues to compress. The 25th percentile of companies trade at 3.3x today compared to 4.0x The median or 50th percentile trade at 4.9x Would it be crazy to see 3.3x

Banking 325

Banking Enterprise Software Revenue 325

SaaStr

JANUARY 4, 2022

2016 customer cohort spends 3.2x Blaze’s 2016 customers spend 3.2x more today than they did in 2016. But the past several quarters Braze has doubled its new customer growth, from 22%-29% to 48% today. That’s a challenge to everyone that says customer growth has to slow at scale. more today.

New CTO 69

New CTO CTO Software Review B2B 69

Tom Tunguz

APRIL 28, 2024

In 2014, 2016, 2020, 2021, these big mergers drove the figures into the tens of billions. X 2015 20.1% - 2016 43.0% Multi-billion dollar acquisitions, the blue bars, are the largest contributors to this swing. It’s no surprise that in those years, the biggest acquisitions accounted for more than 53% of dollars on average.

Acquisition 314

Acquisition Startup Venture Capital Software 314

SaaStr

NOVEMBER 10, 2021

100k+ customers have gone from 50% of revenue in 2016 to almost 80% today: #2. From 2 $1m ARR customers in 2016 to 145 today. $100k+ customers are key to ARR growth. Datadog isn’t leaving the smaller customers behind, but they are increasingly a smaller percentage of revenue. More product, more products, more products.

Scale 362

Scale Cloud Enterprise Scaling 362

SaaStr

DECEMBER 14, 2022

Let’s go back in time … to early 2016. At SaaStr Annual 2016, in February, all the VCs were discouraged. “Unicorns are over,” they said. Just like Marketo was in the 2016 downturn. A sign many of those with the biggest checkbooks in SaaS think things will get substantially better. No way, you say?

SaaS 324

SaaS SMB Pricing Marketing 324

SaaStr

MAY 6, 2022

January 2016, SaaS stocks were riding high. It was called 2016: * Everyone panicked * Seemed like multiples would never recover * LinkedIn sold to Microsoft for 7x ARR. That revenue multiples should rise from where they were in 2019. But I’m hardly sure this will happen in practice. And remember, we’ve seen this all before.

SaaS 348

SaaS Azure Cloud AWS 348

SaaStr

MAY 10, 2022

2016 was tough, too. But the markets also dropped 50% at the start of 2016, and VCs panicked. It was called 2016: * Everyone panicked * Seemed like multiples would never recover * LinkedIn sold to Microsoft for 7x ARR. There are enough good investors out there. — Jyoti Bansal (@jyotibansalsf) May 6, 2022. #6. And then ….

SaaS 316

SaaS Enterprise Startup Investment 316

Tom Tunguz

OCTOBER 29, 2022

Since 2016, the average public software witnessed its sales efficiency winnowed from 52% to 47%, a decline of about 10%. Third, those lows touch the highs of the next rung down; i.e., the current levels of the 75th percentile companies’ sales efficiency is equal to the 50th percentile companies in 2016. What happened?

Sales Hiring 317

Sales Hiring Sales Startup Acquisition 317

Tom Tunguz

JANUARY 26, 2017

In other words, if machine learning startups raised the same amount of money in 2016 is 2010, the chart would show a value of 1. Advertising technology has seen a resurgence in 2016, reversing a three year trend of declines. There are fewer software startups raising capital in 2016 than 2015.

Startup 255

Startup Software Machine Learning Artificial Intelligence 255

Tom Tunguz

MARCH 10, 2022

In 2016, each company recorded less than $50m in revenue. Both have grown very fast. In fact, their revenue trajectories through 2020 are nearly identical. Both companies employ a usage-based pricing model: pay for what you use. In two years, both would near $200m in revenue. They would both exceed $400m in 2020.

Startup 338

Startup Pricing Revenue Development 338

SaaStr

DECEMBER 8, 2020

2016: IPO at $1.15B market cap. And yes, no one could have predicted the run we’ve seen in Cloud in the past few years. But take a look at these examples: Marketo (and Hubspot): Founded 2006. Marketo IPO’s in 2013 at $700m market cap. Vista buys Marketo for $1.8B A little more than 2 years later, it was resold for $4.75B to Adobe.

SaaS 289

SaaS SMB Cloud Revenue 289

SaaStr

MARCH 16, 2021

Cloud has been on an incredible tear since 2012 or so, and then even more since about 2016, and then as you can see above, went into hyperdive in about 2018 … and then into true warp speed after Covid. Yes, the markets have retreated a bit from their all-time highs. But does it even matter? SaaS and Cloud are up +1000% since 2013.

Cloud 325

Cloud SaaS Trends Metrics 325

Tom Tunguz

OCTOBER 18, 2020

The chart above shows the median enterprise value to forward ARR value since 2016. To estimate ARR for a public company, we annualize the analyst consensus estimates for the revenue 4 quarters from today. It hovers around 5x until 2018, then spikes to 8x, and despite some volatility, reaches its current zenith at a bit more than 10x.

Software Review 363

Software Review Finance Enterprise Acquisition 363

The Angel VC

JANUARY 10, 2017

In less earth shattering news, the fact that it's 2017 also means that my "SaaS Funding in 2016" napkin needs an update. As a reminder, in the original post I tried to give a "back of a napkin" answer to this question: What does it take to raise capital, in SaaS, in 2016?

SaaS 262

SaaS Marketplace as a Service Machine Learning Artificial Intelligence 262

SaaStr

JUNE 3, 2022

2016: Dharmesh joined us for the first time, with one of the most engaging and highly-rated SaaStr Annual session on ever: their journey to IP O. In the run-up to SaaStr Annual 2022 on September 13-15 , we wanted to look back at some of the highest-rated SaaStr sessions of all time, since the first SaaStr Annual in 2015.

CTO 316

CTO Retention Startup Scaling 316

Tom Tunguz

JUNE 1, 2024

In 2016, valuations fell 57%. MongoDB fell 24%; UIPath fell 36% ; Salesforce fell 15% ; Workday was down 11%. Weaker revenue projections tend to cause sell-offs. These large drops aren’t unprecedented. Is it different this time? Growth rates have changed meaningfully.

Software 316

Software Marketing Revenue Business 316

SaaStr

JUNE 1, 2022

It’s not slowing down Salesforce, Snowflake, or almost any other SaaS or Cloud leader. Salesforce Growth: 2023 $31.8B (guidance) 2022 $26.5B 2021 $21.25B 2020 $17.1B 2014 $4.1B. Thank you Ohana! pic.twitter.com/CMhrBXgHSF. — Marc Benioff (@Benioff) May 31, 2022. We may be headed for a big downturn, we’ll see.

Sales Hiring 347

Sales Hiring Acquisition Enterprise Cloud 347

SaaStr

APRIL 24, 2021

Well, if it were 2016, we’d say no. Bill.com is one of my favorite sleeper SaaS companies. Half of its revenues comes from its software. And half from fees on transactions it processes: Is this all really ARR? But it isn’t. With an incredible 121% NRR from SMBs, it all essentially recurs. Only half does.

Merchant Services 360

Merchant Services SaaS Payments Payment Solutions Payment Services 360

SaaStr

MAY 7, 2023

Ray Wang of Constellation Research and Vala Afshar, Chief Digital Officer, had me back after a long time on DisrupTV.

Interviewing 297

Interviewing Investment SaaS Sales 297

Tom Tunguz

NOVEMBER 18, 2021

Founded in 2016, Samsara has grown explosively from $119.9m . -. Average Customer Value, $k. -. ACV, Core Customers. -. Enterprise Customers. ARR per Employee. in revenue in fiscal year 2020, to $432m in the first three quarters of fiscal 2022. 71% is the public SaaS company median.

CTO Hire 362

CTO Hire CTO Coach Benchmarks Scale 362

Tom Tunguz

JANUARY 12, 2022

BTC and ETC moved more or less in synchrony from 2016 to 2018. Economics students would argue the discounted cash flow model predicts this behavior. Companies with profits in future years should be less valuable during times of higher interest rates. Three years ago, they went their separate ways.

Software 334

Software Marketing Trends Startup 334

SaaStr

JANUARY 26, 2023

So the minor point is maybe we’re just back to 2016-2017 in SaaS venture capital for Series A and later rounds. For the best ones. But the bigger point is especially for new founders and execs to just look at the chart above. We’re never “going back” to how things were in late 2020 and 2021.

Venture Capital 67

Venture Capital AWS SaaS Startup 67

Tom Tunguz

APRIL 21, 2024

For a period from December 9, 2009, to approximately March of 2016, technology companies produced nearly 5% free cash flow yields on average. Software companies top the charts at 3% over the last 20 years, according to data from New Constructs , a financial research firm. There are times when other sectors yield more.

Software 296

Software Business Construction Government 296

Tom Tunguz

JUNE 14, 2022

During the dotcom crash in 2001, the Global Financial Crisis of 2008, and the SaaS corrections in 2014, 2016, and 2018, Lee was either COO/CFO or CFO at Twilio, SAY Media, and Ofoto. Lee Kirkpatrick is no stranger to downturns.

Management 275

Management Finance Payment Features Subscription 275

SaaStr

JANUARY 11, 2023

But importantly, it’s raised its ACV 4x since 2016. Docebo’s pricing is on the “corporate” side of LMS. It doesn’t compete at the bottom of the market, and targets top logos with a reasonably priced product. Without that, the company would likely be a fraction of its current ARR. #3.

Scale 351

Scale Pricing Scaling Enterprise 351

SaaStr

JUNE 27, 2022

We’ll see, but Zendesk for $10B in 2022 may turn out to be the LinkedIn for $26B in 2016 of this downturn. Yet, founders have only partially adjusted to the new world. A much, much harder and higher hill. A deal that is fair & makes sense when markets are turbulent and worried. But in just a few years, looks like just such a huge bargain.

Acquisition 338

Acquisition SaaS Pricing Revenue 338

Intercom, Inc.

MAY 14, 2018

You could say we’re biased, but the evidence became clearer than ever when messaging apps surpassed social networks in popularity in 2016: Reach. from 8 minutes in 2016 ( eMarketer, 2017 ). 53%: Consumers are 53% more likely to shop with a business they can message ( Facebook Nielsen report, 2016 ). Engagement. Engagement.

Social Media 223

Social Media Artificial Intelligence Scale Marketing 223

SaaStr

APRIL 20, 2020

note: an updated version of a classic 2016 post). Even if today, it’s just not quite enough. It will be later, if your team is strong enough, you will is there, and your customers believe in you. The post Never Quit If appeared first on SaaStr.

Scale 362

Scale Payment Features Engineering Product Marketing 362

SaaStr

APRIL 18, 2021

Salesforce Growth: 2021 $20.8B Guidance 2020 $17.1B 2014 $4.1B. Thank you Ohana! — Marc Benioff (@Benioff) August 25, 2020. If you haven’t done a SaaS start-up before, it’s different. The reasons are many, but I think they can almost all be summed up in one key factor: SaaS compounds.

SaaS 331

SaaS Travel Churn Revenue 331

SaaStr

FEBRUARY 4, 2021

California-based VCs in their portfolio invested 43% of their new investments outside California , up from 29% in 2016. But California funds continued to look outside of the Bay Area. That’s interesting to see quantified. Crazy times in SaaS and Cloud indeed. note: Sapphire Ventures is an LP in SaaStr Fund).

Cloud 283

Cloud Investment B2B SaaS 283

SaaStr

MAY 1, 2023

2016: $3.5m UiPath has had an incredible history, taking 10 years to get to that first $1m in ARR … and then turning into one of the fastest growing software companies to $1 Billion in ARR ever ! UIPath History 2005: Started as a tech outsourcing company 2014: $500k rev. seed round 2015: $1m rev. rev 2017: $30m rev. 2018: $155m rev.

Company Culture 290

Company Culture Innovation AI Enterprise 290

Tom Tunguz

JUNE 20, 2022

From 2007 to 2016, $1.5b I remember thinking a $1b M&A or IPO was so rare an investor might hope to achieve it once or twice in a career. Fewer than 15 SaaS companies traded on public exchanges then. With at least 20 firms and several partners per firm chasing unicorns, upstarts faced stiff odds. 2015 Return Multiple by Round.

Startup 295

Startup Software Investment SaaS 295

SaaStr

MARCH 17, 2022

#1 source of traffic to [link] : 2022: SEO 2021: SEO 2020: SEO 2019: SEO 2018: SEO 2017: SEO 2016: SEO 2015: SEO 2014: SEO 2013: SEO 2012: SEO. Even Year 1 pic.twitter.com/5FtzBG2v1O. — Jason BeKind Lemkin #???????????? jasonlk) March 15, 2022. So we’re coming up on Year 10 for SaaStr!

Engagement 278

Engagement Data Sales Marketing 278

Tom Tunguz

MARCH 28, 2021

The company also mentions the 2016 cohort of customers expanded 51x in the last 5 years. In 2021, the business counted more than 8000 customers, with 1000 paying more than $100k and 89 paying more than $1m. In addition, 70% of new bookings in 2021 originated from expansions.

Payment Services 359

Payment Services Metrics Payment Solutions Payments 359

SaaStr

MAY 22, 2023

Not easy, but easier and easier: There was a bump in 2016, a Flash Crash in SaaS, when budgets were slashed, but it didn’t last long enough to really impact renewal cycles. SaaS markets had fully recovered later that year. Even the 2008-2009 downturn, while truly brutal, didn’t hit SaaS as hard as the rest of the economy.

SaaS 318

SaaS Churn Sales Software 318

SaaStr

MARCH 19, 2023

Check out this week’s top blog posts, podcasts, and videos: Top Blog Posts This Week: The Three Valuation Lows in SaaS: 2013, 2016, and 2022 5 Interesting Learnings from Doximity at $450,000,000 in ARR Is Cold Calling Dead? Each week, we round up our most popular content so you can catch up on anything you may have missed.

Scale 276

Scale Enterprise Churn Startup 276