NEW: 80+ SaaS Companies Reveal MRR and Other SaaS Metrics

SaaS metrics, data, examples

At 19 I started a SaaS company in my dorm room and just sold it in February after my 25th birthday mainly due to luck and blind hard work.

Over the companies life, we raised $2.5M in venture capital, drove $5M in sales (mainly by cold emailing potential partners), and grew our customer base to over 10,000 paying customers.

Thing was, I had no idea if our MRR growth rate, LTV:CAC ratio, and other unit economics were better or worse than other SaaS companies.

Top SaaS Entrepreneurs Podcast

To collect benchmarks I launched a 15 minute daily podcast called The Top Entrepreneurs and found myself favoring interviews with SaaS CEO’s.

I’ve created a second podcast, The Top SaaS Entrepreneurs featuring SaaS CEO’s exclusively ranging from $1m-$100M in ARR.

Click image to subscribe and get first 7 episodes:

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1 Danielle Morrill MatterMark $275K MRR, 500 Customers
2 Ryan Urban Bounce Exchange $2.5M MRR, 250 Customers
3 Khuram Hussain FileBoard $1.7M MRR, 800 Customers
4 Rand Fishkin Moz $2.6M MRR, 22740 Customers
5 Mathilde Collin FrontApp $242K MRR, 1210 Customers
6 DaveNegot Hubstaff $81K MRR, 2360 Customers
7 Jonathon Ende SeamlessDoc $2M MRR, 1412 Customers

Worlds largest database of SaaS metrics

I decided to categorize all 80+ companies in this google spreadsheet and launch a 15 minute SaaS only weekly podcast where CEO’s talk about their private data – data they haven’t shared anywhere else online.

This 80+ company downloadable excel version of the data is my go-to every time I board a flight:

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This article will focus on rankings of key SaaS metrics, a deep dive on 10 SaaS companies ranging from $1-$100M in ARR, and SaaS valuations.

Article Index:

  1. SaaS Unit Economic Rankings
  2. Deep dive on 11 SaaS Companies
  3. How to value your SaaS Startup
  4. Fastest way to grow your SaaS Startup
  5. Recommended SaaS Books
  6. Recommended SaaS Blogs
  7. Spreadsheet with data from 80+ companies

Top 5 Monthly Recurring Revenue (MRR)

  1. Moz, $2.6M MRR
  2. Bounce Exchange, $2.5M
  3. Aweber, $2.2M
  4. Prosper Works, $2M
  5. Seamless Doc, $2M
  6. Click here for full MRR rankings

To drive up your MRR 3-20x, Jason Lempkin breaks down how to transition from a tool sale to a solution sale here:

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If you feel stuck, you could also experiment with one of the 7 different SaaS revenue streams from VC Lincoln Murphy.

Negative Monthly Revenue Churn Club

  1. Cirrus Insights, -2%
  2. PropserWorks, -1%
  3. Bounce Exchange, -.5%
  4. Click here for full churn rankings

This is calculated by taking total new revenue from an existing customer base (upsells) in any given month, subtracting revenue from lost customers in that same month, and then dividing by total monthly recurring revenue.

David Skok highlights the importance of negative churn here:

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Negative monthly revenue churn signals a SaaS company that has mastered making customers happy and ultimately selling them on new products and services.

All 3 companies above do this through aggressive inside sales teams that qualify based off key usage checkpoints.

Top 5 LTV:CAC Ratios

  1. InspiredBeats, $807 in lifetime value (LTV) for every $1 spend on acquisition (CAC)
  2. WebinarNinja, $548 in lifetime value (LTV) for every $1 spend on acquisition (CAC)
  3. Fileboard, $167 in lifetime value (LTV) for every $1 spend on acquisition (CAC)
  4. AdEspresso, $100 in lifetime value (LTV) for every $1 spend on acquisition (CAC)
  5. FuelPanda, $44 in lifetime value (LTV) for every $1 spend on acquisition (CAC)
  6. Click here for full LTV:CAC rankings

Many of the companies that ranked leveraged content marketing. The CAC number we used is not fully weighted and does not include salaries of people writing the content for example. CAC for these rankings was based off a non-diluted, not fully weighted, CAC usually consisting of paid marketing spend only.

Redpoint Ventures VC Tomasz Tunguz tells you how to unpack your LTV:CAC ratios here:

ltv_cac_breakdown

Top 5 Revenue Per Employee

  1. SeamlessDoc, $960K in annual revenue per employee
  2. Fileboard, $816K in annual revenue per employee
  3. InspireBeats, $759K in annual revenue per employee
  4. ClickFunnels, $626K in annual revenue per employee
  5. ProsperWorks, $358K in annual revenue per employee
  6. Click here for full Rev/Employee rankings

In a world where pre-revenue companies can land millions in funding, revenue per employee is a number that a rational investor like Warren Buffet would appreciate. This is a sign that unit economics up and down the profit and loss statement (biggest Gen and Admin expense is usually employee salaries) are healthy.

Focusing no revenue per employee as a measure of keeping headcount expenses in check is just one way to help drive the growth of your SaaS business.

VC Christoph Janz shares 5 other ways to build a $100M business here:

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10 Featured SaaS Companies

This data was all collected through one on one interviews I had with the CEO (or other executive) on my daily 15 minute podcast, The Top Entrepreneurs.

For example, if a founder told me they do $1m in MRR with 100,000 customers, I assumed a $10 monthly ARPU. Most of the data is “straight from the horses/CEO’s mouth”, as they say.

1. Cirrus Insights, $7.8MM ARR (Annual Recurring Revenue)

Founded in 2011, this is a tool that helps sales people integrate their gmail inbox with Salesforce.

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Nathan’s estimated valuation: $76,800,000 (see note below on valuations)
Number of Customers: 100,000 (Cirrus sells a company seats. 100k represents total number of seats sold, not total number of businesses paying Cirrus. One business may pay for 1000 seats.)
Average Revenue per User per Month (ARPU): $6
Monthly Recurring Revenue (MRR): $640,000
Annual Recurring Revenue (ARR): $7,680,000
Net Churn: -2%
Customer acquisition cost (CAC): $85
Average total dollars a customer pays you (LTV): $750 (unclear whether this is per seat or per business)
Average # of months a customer pays you: Unknown
CAC to LTV Ratio: $85:$750 or 1:8 (very healthy, means company acquiring customers profitably)
Team size: 90
Capital Raised: $0
Space: Mid market to enterprise
Click play below to hear the CEO and co-founder of Cirrus Insight, Brandon Bruce, walk me through this data:

2. Kit CRM, $456k ARR

Kit is an online marketing platform that allows sellers to directly connect social media platforms with their eCommerce platform to drive more sales.

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Nathan estimated valuation: (see note below on valuations)

Number of Customers: 2000
Average Revenue per User per Month (ARPU): $19
Monthly Recurring Revenue (MRR): $38,000
Annual Recurring Revenue (ARR): $456,000
Gross Churn: 4%
Customer acquisition cost (CAC): $21
Average # of months a customer pays you: 25
Average total dollars a customer pays you (LTV): $475
Team size: 9
Capital raised: $1,000,000
Space: Small Business to Mid Market

Source: Click play below to hear the CEO of Kitcrm.com, Michael Perry, walk me through this data:

3. Boomerang (Baydin) $3.9MM ARR

Founded in 2011, a chrome extension that allows you to quickly set reminders, schedule events, and get open tracking inside of your Gmail inbox.

B4G-Logo

Nathan’s estimated valuation: (see note below on valuations)
Number of Customers: 29,545+
Average Revenue per User per Month (ARPU): $11
Monthly Recurring Revenue (MRR): $325,000
Annual Recurring Revenue (ARR): $3,900,000
Gross Churn: 7%
Customer acquisition cost (CAC): NA
Average # of months a customer pays you: 14
Average total dollars a customer pays you (LTV): $157
Team size: 13
Capital raised: $400,000
Space: Small Business to Mid Market

Source: Click play below to hear Alex Moore, CEO and co-founder of Boomeranggmail.com, share this data and more with me.

4. Contactually, $8.4MM ARR

Founded in 2011, CRM tool that allows you to bucket relationships into categories and set follow up reminders.

contactually
Nathan’s estimated valuation: (see note below on valuations)
Number of Customers: 11667
Average Revenue per User per Month (ARPU): $60
Monthly Recurring Revenue (MRR): $700,000
Annual Recurring Revenue (ARR): $8,400,000
Gross Churn: 4%
Customer acquisition cost (CAC): unknown
Average total dollars a customer pays you (LTV): $1500
CAC to LTV Ratio: unknown
Average # of months a customer pays you: 25
Team size: 56
Capital raised: 13,830,000
Space: Small business to mid market
Source: Click play below to meet Zvi Band, CEO of Contactually.com, to hear his story.

5. AdEspresso, $1.8MM ARR

The quick way to manage and optimize your Facebook advertising.

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Nathan’s estimated valuation: (see note below on valuations)
Number of Customers: 1500
Average Revenue per User per Month (ARPU): $100
Monthly Recurring Revenue (MRR): $150,000
Annual Recurring Revenue (ARR): $1,800,000
Gross Churn: 7%
Customer acquisition cost (CAC): unknown
Average total dollars a customer pays you (LTV): $1000
CAC to LTV Ratio: unknown
Average # of months a customer pays you: 10
Team size: 15
Capital raised: $1,800,000
Space: Small Business to Mid Market
Source: Armando Biondi joins me live to share Adespresso.com story and data, click play below now.

6. Yesware, $9.6MM ARR

CRM tool for sales people. Competes with Cirrus Insight above.

yesware_logo

Nathan’s estimated valuation: (see note below on valuations)
Number of Customers: 1667
Average Revenue per User per Month (ARPU): $500
Monthly Recurring Revenue (MRR): $833,333
Annual Recurring Revenue (ARR): $9,600,000
Gross Churn: unknown
Customer acquisition cost (CAC): unknown
Average total dollars a customer pays you (LTV): unknown
CAC to LTV Ratio: unknown
Average # of months a customer pays you: unknown
Team size: 80
Capital raised: $33,000,000
Space: Mid Market
Source: CEO of Yesware, Matthew Bellows, joins me live:

7. Seamless Docs, $24M ARR

Founded in 2011, helps governments more efficiently manage contracts, pdf’s, and other documents.

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Nathan’s estimated valuation: (see note below on valuations)
Number of Customers: 1412
Average Revenue per User per Month (ARPU): $1,417
Monthly Recurring Revenue (MRR): $2,000,000
Annual Recurring Revenue (ARR): $24,000,000
Gross Churn: 1%
Customer acquisition cost (CAC): unknown
Average total dollars a customer pays you (LTV): $141,600
CAC to LTV Ratio: unknown
Average # of months a customer pays you: 25
Team size: 25
Capital raised: $7,700,000
Space: Goverment

Source: Jonathan Ende, CEO of Seamless Docs, breaks down how he went form $0 to $2MM SaaS company in under 2 years. Click play below now.

8. ClickFunnels, $14MM ARR

Founded in 2015, the fastest way to set up a checkout process for your product or service.

clickfunnels_logo

Nathan’s estimated valuation: (see note below on valuations)
Number of Customers: 10,000
Average Revenue per User per Month (ARPU): $120
Monthly Recurring Revenue (MRR): $1,200,000
Annual Recurring Revenue (ARR): $14,400,000
Gross Churn: 4%
Customer acquisition cost (CAC): “Minimal”
Average total dollars a customer pays you (LTV): $3,000
CAC to LTV Ratio: unknown
Average # of months a customer pays you: 25
Team size: 15
Capital raised: $1,000,000
Space: Small Business
Source: CEO of ClickFunnels, Russell Brunson, shares why he just turned down at $35MM acquisition offer. Click play below now.

9. Aweber, $28MM ARR (Low side)

Founded in 1999, Aweber makes it easy to grow and manage your email list.

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Nathan’s estimated valuation: (see note below on valuations)
Number of Customers: 120,000
Average Revenue per User per Month (ARPU): $20
Monthly Recurring Revenue (MRR): $2,400,000
Annual Recurring Revenue (ARR): $28,800,000
Gross Churn: 4%
Customer acquisition cost (CAC): $100
Average total dollars a customer pays you (LTV): $500
CAC to LTV Ratio: 1:5
Average # of months a customer pays you: 25
Team size: 96
Capital raised: $0
Space: Small Business, website here
Source: Sean Cohen, COO at Aweber, gives me an interesting answer when I ask “Is Aweber for sale?”. Click play now:

10. Latergramme, $600k ARR

Founded in 2015, an efficient way to use Instagram without spending all of your time on the app everyday.

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Nathan’s estimated valuation: (see note below on valuations)
Number of Customers: 3,500
Average Revenue per User per Month (ARPU): $14.50
Monthly Recurring Revenue (MRR): $50,000
Annual Recurring Revenue (ARR): $600,000
Gross Churn: 5%
Customer acquisition cost (CAC): unknown
Average total dollars a customer pays you (LTV): $290
CAC to LTV Ratio: unknown
Average # of months a customer pays you: 20
Team size: 11
Capital raised: $1,200,000
Space: Small Business
Source: Matt Smith, Founder of Latergram.me shares hoe he went from nothing to $50k users, 500,000 users, and $1.2MM raised. Click play below now.

11. PandaDoc, $3.6MM ARR

Founded in 2015, all in one software to create, deliver, and eSign your teams quotes, proposals, contracts and other sales collateral.

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Nathan’s estimated valuation: (see note below on valuations)
Number of Customers: 10,000
Average Revenue per User per Month (ARPU): $30
Monthly Recurring Revenue (MRR): $300,000
Annual Recurring Revenue (ARR): $3,600,000
Gross Churn: .85%
Customer acquisition cost (CAC): unknown
Average total dollars a customer pays you (LTV): $4000
CAC to LTV Ratio: unknown
Average # of months a customer pays you: 133 (1 divided by gross churn, this is extrapolated and likely not accurate outside of excel pro formas)
Team size: 65
Capital raised: $9,000,000
Space: Mid Market to Enterprise
Source: Jared Fuller, Head of Partnerships and BD of PandaDoc, shares how they will hit $10MM in ARR in 2016. Click play below now.

For VC’s, Investors, and Analysts:

Use this link to access excel file. If you’d like an intro or more info on any of these companies, feel free to email me and I’ll be as helpful as I can, nathan@nathanlatka.com

If you’re a SaaS founder and find value in everyone else’s data add your own data in a new row in the Google Spreadsheet below. It’ll help us all learn faster.

 

How Much Is Your Company Worth? (How I Value a SaaS company)

The valuations I assigned each company above are valuations I’d be willing to pay if I was investing in their next round of capital.

Assuming a rational deal (meaning no emotional leverage), SaaS company valuations are a combination of annualized ARR multiplied by some multiple.

You get a higher multiple on ARR if your churn is net negative, you have a 5%+ month over month growth rate in MRR, and a healthy (1:3 or 1:4+) CAC:LTV Ratio. If you fall in the green category below, call me 7034312709.

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If you’re unhappy where your company falls (maybe in one of the red columns above), in the next section I walk through how to move yourself into the green section.

The Fastest Way to Build a $100MM+ SaaS Company

The quickest way to build your SaaS company valuation is to keep current customers paying for 50+ months (means 2% or less gross monthly churn) and drive expansion revenue from current customer base (negative net monthly churn). The reasoning for this valuation is outlined in the section above this one “How Much is Your Company Worth”.

Churn in a SaaS business is measured many different ways. The data I presented in the companies above focuses on gross customer churn which is calculated by taking total lost customers and dividing by total number of customers (5 lost customers in a month divided by 100 total customers is 5% churn).

In SaaS businesses where ARPU varies greatly, executive teams may measure gross/net revenue churn (instead of customer churn). They’ll argue, we may have lost 10% of our customer base but they were all small businesses that made up less than 1% of our revenue. (10% customer churn vs. 1% revenue churn).

The holy grail in a SaaS business is reaching net negative revenue churn. This occurs when the revenue you upsell your current customer base on exceeds the lost customer revenue from that same month.

Example:
Total MRR at end of March: $100,000
Total MRR lost in April: $2,500
Gross MRR churn in April: 2.5%
MRR added in April by upselling March customers: $5,000
Net MRR churn in April: -2.5%

To get the benefits of high ARR multiples on your SaaS company valuation (5-10x), you need to aim to be below 2% gross MRR churn on a monthly basis (24% annually). To hit a $100MM+ valuation, reach negative net MRR churn.

10 SaaS Focused Business Books

  1. Automatic Customer, John Warrillow: 8+ recurring revenue subscription models with examples of each.
  2. Predictable Revenue, Aaron Ross: The guy who built Salesforce to $100M+ ARR.
  3. Traction, Justin Mares: Loads of ideas on where to find new customers for your SaaS business.
  4. Crossing the Chasm, Jeoffrey moore: Many SaaS founders hang on too long. This book will quickly help you figure out if you’re on track to the big leagues or if you should fold up your current company and start fresh.
  5. Hooked, Nir Eyal: Focus on how to get your users addicted to your product to reduce churn. Good ideas on how to drive upsell and expansion revenue to get to net negative revenue churn based off usage metrics (# contacts, # credits, etc)
  6. Behind the Cloud: Marc Benioff: SaaS from the entrepreneurs perspective.
  7. From Impossible to Inevitable: Aaron Ross
  8. The Sales Acceleration Formula: Mark Roberge

SaaS events:

  1. Saastr, 10,000+ February, San Fran: http://www.saastrannual.com/
  2. SaaStock, 700+ September, Dublin: http://www.saastock.com/ (Founder to Investor ratio, 3:1)
  3. SaaS North, 100+, November, Ontario http://saasnorth.com/
  4. Dan Martell’s Idea to Exit, http://go.ideatoexitlive.com/attend/

 

17 thoughts on “NEW: 80+ SaaS Companies Reveal MRR and Other SaaS Metrics

    1. Doesn’t matter how fast you’re growing if your bucket is leaking. 7% monthly churn is way too high – eventually you’ll churn through whole market. Doesn’t matter how fast you’re adding new customers.

  1. For PandaDoc, the LTV and # of customers don’t add up. I assume that only a certain % of customers pay. Do you have # of paying customers for each of these companies?

  2. So basically, if you have 22,000 customers and a churn rate of 6.5%, you are almost replacing your customer base each year. Did I apply the terminology and math correctly? I would be interested to know where the customers are going and why.

      1. 6.5% monthly churn is bad, but not 78% a year bad.

        Actually 6.5% monthly churn = 55.4% yearly churn.

        Here is why.

        When counting yearly churn, you don’t just multiply monthly churn by 12.

        They way to calculate it would be to count how many customers are left at the end of the year, divide that by the # of customers in the beginning and then subtract that number from 1.

        So if Monthly Churn = 6.5%
        Then after a month we are left with 93.5% of our customers.
        After a second month we are left with 93.5% of the 93.5%: 93.5%*93.5% = 87.4% customers retained after 2 months.

        After 12 months: 93.5% ^ 12 = 44.6% customers left.

        So with 6.5% Monthly Churn you get a 55.4% yearly churn.

        Not 78% but still too big to build a sustainable business.

        P.S. Love your content Nathan.

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