Presented by Sage Intacct
In a post-COVID world data-backed business planning is more important than ever. This year’s KeyBanc Capital Markets SaaS company Survey has the benchmarks CFOs, RevOps, and finance leaders need. Join this VB Live event to see where you stand.
In light of today’s volatile business market, it’s more important than ever that business leaders keep track of their position in the market. That’s why this year’s annual KeyBanc Capital Markets SaaS Survey is essential reading. Here’s a look at the most important highlights of the survey, what those benchmarks reveal about weathering the storm, and tips for staying competitive.
Top metrics investors want to see
This year, investors are focused on churn, cost structure, and capital consumption — and cash is the primary topic for every board. They’re asking the important questions you need to answer now: What does your runway of cash look like? Do you have access to further capital?
Do you have revenues that you can depend on, whether that’s customer, product, or cohort, depending on your billing model?
The top business concerns right now
The survey reveals that in these challenging times, it’s time to revisit some of the key areas of your business and sharpen your focus, fine tune your structure, and make sure your goals are concrete, clear, and guiding your decisions.
Here are some of the most important issues to think about now.
Cost structure and CAC
If your business is stable now, the next question is how to get more efficient in your cost structure and your CAC. Your CAC ratio and Payback Period is also critical.
The CAC ratio is the cost to acquire a customer — how much time, in terms of subscription dollars and gross margins, it takes to payback the acquisition cost. Now is the time to talk to your marketing department about those metrics, and whittle down your costs to the efforts that have proven to be most efficient. It’s time to talk about your ideal client profile, and how to reach them to boost your CAC.
Operating costs and cost of service
This arena is most essential for early-stage companies that often have a negative gross margin.
If you can perfect your cost of service, you gain tremendous leverage in the rest of your business, especially operating profitability and cashflow, and can then afford to pivot to opportunities and stay agile. Even an improvement of just a few points gives you this advantage.
Sales and marketing
In a challenging down market, it’s imperative to take a deep dive into sales and marketing expenses. It’s time to recognize that in markets like these, there’s just only so much you can grow. Whether it’s churn or whether it’s people just not interested in buying in an economic downturn, you’re going to see a drop in the effectiveness of your sales and marketing.
Stay sensitive to the market and stay sensitive to the customer base you’re serving, and take account of your speed of growth. Maybe now is the time to start cutting down your sales and marketing expense so you can spend less, and regain the cashflow you need to funnel into other areas of your business as you, your customers, and the economy essentially regroups.
Keeping your board on board
In the current climate, strategic communication with your board is key. You need to always be ready to clearly outline where your company stands, and how your typical benchmarks have shifted.
And most important, be able to share what you can change and what you can’t, and your strategy not just for now, but when the market rebounds. Every company needs to keep long-term opportunities in mind, and remain flexible — prepare for now, but don’t cut so far into the strategies of growth that ultimately provide the fuel you’ll need.
For a deeper dive into the SaaS metrics you need to keep tabs on, the most important findings from the 2020 KeyBanc SaaS survey, and how to develop a path forward, don’t miss this VB Live event.
Don’t miss out!
You’ll learn about:
- COVID benchmarks on ARR, churn, CAC, and capital efficiency
- How to gauge relative success in terms of growth and cash flow profitability
- Comparisons across funding stages, go-to-market models, type of product and primary buyer
- Operational adjustments companies are making in the wake of the changing environment
- David Spitz, Managing Director, KeyBanc Capital Markets
- David Appel, Head SaaS Vertical, Sage Intacct
- Moderated by VentureBeat