SaaS Capital Blog

Corporate Rates in the Info Tech Sector vs US Treasury Rate

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Interest Rates: More to Know Than Just the Headline Number

While private rates in the mid-to-high teens remain elevated compared to the past decade-plus, they are in line with rates for sector peers in the public market. Moreover, from a borrower’s perspective, these rates may actually be considered relatively attractive when one accounts for current US Treasury rates.

2025 Private SaaS Company Valuations

The SaaS Capital Index™ stands at 7.0 times current run-rate annualized revenue. Data for bootstrapped companies yields a predicted private SaaS company valuation multiple of 4.8x while data for equity-backed companies yields a predicted valuation multiple of 5.3x.

How to have a 95% Gross Revenue Retention Selling SaaS to Small Businesses

The article examines the methodology behind ServiceTitan's reported 95% gross revenue retention (GRR) in its IPO documentation, noting that the approach excludes downsells and only accounts for complete churns, which can result in a higher GRR figure. While the 95% figure is impressive, the analysis suggests that a more typical annualized GRR for small businesses in the building trades would likely be lower, aligning with industry norms.

What is the Average Deal Size for Private SaaS Companies?

Due to their compliance reporting requirements, there is plenty of data available about public SaaS companies. However, due to the size and funding of those companies, their metrics are typically not a good benchmarking metric for smaller, private SaaS companies. In order to provide peer-based benchmarking, SaaS Capital conducts a survey of private, B2B SaaS company metrics in the first quarter of each year. This post summarizes benchmarking data around the topic of Annual Contract Value (ACV).

What Should a SaaS Income Statement Look Like in 2025?

A SaaS Profit & Loss (P&L) statement needs to be organized in order to be meaningful to both internal stakeholders and potential external partners, such as capital providers. As the SaaS business model has evolved, it is worth examining what an income statement should look like in 2025.

2024 Revenue Per Employee Benchmarks for Private SaaS Companies

A common metric by which SaaS companies track their performance is annual recurring revenue (ARR) per employee. This 2024 update explores the median ARR per employee broken down by company size and funding type, equity-backed or bootstrapped.

2024 Growth Benchmarks for Private SaaS Companies

Based on SaaS Capital's 13th annual B2B SaaS company metrics survey, growth across most revenue brackets (ARR categories) growth has decreased or remained stable from 2022 to 2023. Bootstrapped companies faced a decline in growth rates across all revenue brackets, particularly at higher ARR levels. In contrast, equity-backed companies showed mixed performance, with early-stage firms (those under $1 million ARR) experiencing strong growth, while mid-tier companies saw either modest growth or slight declines.

What Should be Included in COGS for My SaaS Business in 2025?

Surprisingly, GAAP does not clearly define what should be included in a SaaS company’s Cost of Sales (COS; a.k.a. Cost of Revenue, COR, but most commonly known by the traditional term Cost of Goods Sold, COGS) so each company is pretty much left to its own judgment on what should be included. Below is our considered opinion on what to include in COGS for a privately-held SaaS company.

Key Takeaways from SaaStr Annual 2024: Navigating AI's Impact and Opportunities for SaaS Companies

SaaS Capital attended SaaStr Annual 2024. This was the first SaaStr AI Summit and it lived up to its billing – discussions on all things AI dominated the event. As this hot topic continues to be top-of-mind for many operators and investors, we wanted to share some of our key impressions and takeaways from the panels as well as discussions we had with industry participants.

Escaping the Tax Trap - Update September 2024

Essentially, starting in 2022, any amounts spent by a U.S. company on software development were no longer permitted to be deducted against income, but instead had to be capitalized over several years.  This “tax trap” meant that many engineering-heavy SaaS companies operating near cash flow breakeven could suddenly appear profitable “on paper” (and on tax returns), leading to an income tax liability.