Introduction

One of the greatest pleasures of my job is meeting many early stage entrepreneurs every week. I estimate that about 70% of the companies I meet have SaaS or subscription-based revenue models. Because of this, and because a core area of our investment mandate is to invest in enterprise SaaS businesses, I wrote this piece, which was initially an internal guide to explain how to systematically analyze a company’s SaaS metrics.

What follows is a set of analytical methods that a VC may use during diligence or the general decision-making process.

This piece is intended for SaaS entrepreneurs raising a financing round. Understand how investors use SaaS metrics and how best to present them and you will increase the likelihood of getting venture funded. Continue reading →