For SaaS companies valued at over $1billion, the median amount of financing raised is $206million

Statistic Info

The WSJ published a recent chart of the 49 startups with billion dollar valuations. According to their research, there have never been as many privately held companies with such high valuations ever. The absolute number of these massively valuable companies alone is amazing. Ten years ago, most of them would have gone public by now. But what other insights can we tease from the data about these very special businesses?

First, the Billion Dollar Club (BDC) is nearly evenly split between Consumer and Enterprise companies, as the table below shows. I’ve noted the median dollars raised, the median valuation and the valuation efficiency in the table. The valuation efficiency is the valuation divided by the capital raised. This metric tries to answer the question, how much capital did the startup need to raise to achieve that valuation? This is a somewhat flawed metric[1] but I’m going to use it to compare the relative attractiveness of sectors[2].

More Tech Services Stats

A 1% increase in pricing strategy yields an average 11% increase in profit

Customer Acquisition Cost (CAC) = sum of all sales & marketing expenses/ number of new customers added

The very best SAAS business has a negative churn rate and will have a Dollar Retention Rate of greater than 100%

The top 50% of the fastest growing SaaS businesses generate much higher upsells than their competitors. The larger the business, the greater the impact of upselling

47% of millennials want to work at diverse companies, according to a recent study.

Because of the losses in the early days, which get bigger the more successful the company is at acquiring customers, it is much harder for management and investors to figure out whether a SaaS business is financially viable.

If your Net Revenue Churn is high (above 2% per month) it is an indicator that there is something wrong in your business; which may have a dramatically negative effect on your company’s growth. Source: Mckinsey

Getting paid in advance is really smart idea if you can do it without impacting bookings, as it can provide the cash flow that you need to cover your cash problem

Smaller SAAS companies reported more frequent use of third-party providers as their primary application delivery method, while the largest companies were more likely to use self-managed servers

Revenue per employee has been steadily increasing in SAAS companies. It serves as a great longitudinal measuring stick to understand the increasing or decreasing efficiency of the business

More Growth Strategy Stats

In 2018, the global tech spending is forecast to amount to 3,212 billion U.S. dollars.

SaaS companies in the $7.5MM-$15MM range are among the fastest growers

The average company gets 16% of new ACV sales from up-sells and expansions, though companies with revenue between $10MM-$40MM are relying more heavily on up-sell and expansions

The median cost for a SaaS company to acquire a dollar of new customer revenue is $1.18

Achieving a SaaS Quick Ratio of 4 is a good benchmark for young, high-growth companies but the equation changes as those companies reach scale

The largest SaaS companies (>$75million yearly revenue) attribute 2.5x as much new revenue to upselling than the smallest SaaS companies (<$1.25million): 28% versus 11%

Moving from $1.5 million with an eye towards $10 million in ARR is a tough a task and will take an excellent VP of sales to get you there

The average company booking professional services revenue on new deals is equivalent to 16% of the first year subscription value. Professional services margins are approximately 22%

In 2020, China is expected to generate 55 billion U.S. dollars in the global medical technology market.

The average Quick Ratio of fastest growing SaaS companies (those with a CAGR of over 50%) is 3.9: generating $3.9 in revenue for every $1 lost to revenue churn