PRIVATE SAAS COMPANY SURVEY REVEALS SHIFT TOWARDS FUTURE GROWTH WITH A CONTINUED FOCUS ON OPERATIONAL EFFICIENCY AND PROFITABILITY
KeyBanc Capital Markets (KBCM) and Sapphire Ventures released their 15th annual Private SaaS Company Survey, revealing key trends in the software industry. The survey of over 100 private SaaS companies shows ARR growth expected at ~19% in 2024, nearly double the public software companies' rate.
Companies are maintaining focus on operational efficiency and profitability while preparing for future growth. Notable findings include increased sales team quotas by over 10% in 2023, improved quota attainment from ~70% to ~75%, and consistent retention rates at ~90% gross and ~101% net. AI-first SaaS companies are particularly optimistic about growth acceleration in the next 12 months, with public market software valuations returning to normalized levels at ~5-6x NTM revenue.
KeyBanc Capital Markets (KBCM) e Sapphire Ventures hanno pubblicato il loro 15° sondaggio annuale sulle aziende SaaS private, rivelando tendenze chiave nel settore del software. Il sondaggio condotto su oltre 100 aziende SaaS private mostra che si prevede una crescita dell'ARR di circa il 19% nel 2024, quasi il doppio rispetto al tasso delle aziende software pubbliche.
Le aziende continuano a concentrarsi su efficienza operativa e redditività mentre si preparano per una crescita futura. Tra i risultati notevoli ci sono l'aumento delle quote di vendita di oltre il 10% nel 2023, il miglioramento nel raggiungimento delle quote da circa il 70% a circa il 75%, e tassi di retention costanti intorno al 90% lordo e ~101% netto. Le aziende SaaS orientate all'AI sono particolarmente ottimiste riguardo all'accelerazione della crescita nei prossimi 12 mesi, con le valutazioni del software sul mercato pubblico che tornano a livelli normalizzati di circa 5-6 volte i ricavi NTM.
KeyBanc Capital Markets (KBCM) y Sapphire Ventures publicaron su 15ª encuesta anual sobre empresas SaaS privadas, revelando tendencias clave en la industria del software. La encuesta de más de 100 empresas SaaS privadas muestra que se espera un crecimiento de ARR de aproximadamente el 19% en 2024, casi el doble de la tasa de las empresas de software públicas.
Las empresas continúan enfocándose en la eficiencia operativa y la rentabilidad mientras se preparan para el crecimiento futuro. Hallazgos notables incluyen un aumento en las cuotas del equipo de ventas de más del 10% en 2023, una mejora en el cumplimiento de las cuotas del ~70% al ~75%, y tasas de retención consistentes de aproximadamente el 90% bruto y ~101% neto. Las empresas SaaS centradas en AI son particularmente optimistas sobre la aceleración del crecimiento en los próximos 12 meses, con las valoraciones del software del mercado público regresando a niveles normalizados de ~5-6 veces los ingresos NTM.
키뱅크 캐피탈 마켓(KBCM)과 사파이어 벤처스가 15번째 연례 개인 SaaS 기업 조사 결과를 발표하며 소프트웨어 산업의 주요 트렌드를 밝혔습니다. 100개 이상의 개인 SaaS 기업을 대상으로 한 조사에 따르면, 2024년 ARR 성장률이 약 19%에 이를 것으로 예상됩니다, 이는 공공 소프트웨어 기업의 성장률의 거의 두 배에 해당합니다.
기업들은 미래 성장을 준비하면서 운영 효율성과 수익성에 집중하고 있습니다. 주요 결과로는 2023년 영업팀 할당량이 10% 이상 증가했고, 할당량 달성률이 ~70%에서 ~75%로 개선되었으며, 총 90% 및 순 101%의 안정적인 유지율이 포함됩니다. AI 중심의 SaaS 기업들은 다음 12개월 동안 성장 가속화에 대해 특히 낙관적이며, 공공 시장의 소프트웨어 평가는 ~5-6배 NTM 수익으로 정상 수준으로 회복되고 있습니다.
KeyBanc Capital Markets (KBCM) et Sapphire Ventures ont publié leur 15e enquête annuelle sur les entreprises SaaS privées, révélant des tendances clés dans l'industrie du logiciel. L'enquête menée auprès de plus de 100 entreprises SaaS privées montre que la croissance de l'ARR devrait atteindre environ 19 % en 2024, soit presque le double du taux des entreprises de logiciels publiques.
Les entreprises maintiennent leur concentration sur l'efficacité opérationnelle et la rentabilité tout en se préparant à une croissance future. Les résultats notables incluent une augmentation des quotas de l'équipe de vente de plus de 10 % en 2023, une amélioration de l'atteinte des quotas de ~70 % à ~75 %, et des taux de fidélisation constants à environ 90 % brut et ~101 % net. Les entreprises SaaS axées sur l'IA sont particulièrement optimistes quant à l'accélération de la croissance dans les 12 mois à venir, les évaluations des logiciels sur le marché public revenant à des niveaux normalisés d'environ 5-6x les revenus NTM.
KeyBanc Capital Markets (KBCM) und Sapphire Ventures haben ihre 15. jährliche Umfrage zu privaten SaaS-Unternehmen veröffentlicht, die wichtige Trends in der Softwarebranche aufzeigt. Die Umfrage unter über 100 privaten SaaS-Unternehmen zeigt, dass ein ARR-Wachstum von etwa 19% im Jahr 2024 erwartet wird, was nahezu dem Doppelten der Rate öffentlicher Softwareunternehmen entspricht.
Die Unternehmen konzentrieren sich weiterhin auf operationale Effizienz und Rentabilität, während sie sich auf zukünftiges Wachstum vorbereiten. Zu den bemerkenswerten Ergebnissen gehören eine Erhöhung der Vertriebsteams von über 10% im Jahr 2023, eine Verbesserung der Quotenverwirklichung von ~70% auf ~75% und konsistente Bindungsraten von ~90% brutto und ~101% netto. AI-first SaaS-Unternehmen sind besonders optimistisch hinsichtlich einer Wachstumsbeschleunigung in den nächsten 12 Monaten, wobei die Bewertungen öffentlicher Softwaremärkte auf normalisierte Niveaus von ~5-6x NTM-Umsatz zurückkehren.
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15th annual report suggests AI and macro-economic optimism as drivers of growth in 2025
This year's survey included more than 100 private software as a service (SaaS) companies revealing a continued focus on efficient execution and profitability — a resounding theme throughout the report. The report also suggests that private SaaS companies have an opportunity to shift their focus from dealing with uncertainty to pursuing future growth, with artificial intelligence (AI)-first SaaS companies in particular expecting to experience growth acceleration in the next 12 months.
TOP TRENDS AND INSIGHTS:
Annual Recurring Revenue (ARR) growth and retention remain consistent.
- ARR growth is expected to slightly decelerate year-over-year to ~
19% in 2024; however, this is still nearly twice as fast as public software companies, which have an estimated median growth rate of ~11% in 2024. - Both gross retention and net retention have remained, and are expected to remain, relatively consistent at ~
90% and ~101% , respectively.
Anticipated increase in sales quotas and attainment rates for Go-To-Market (GTM) teams as companies adopt AI and learn how to further improve GTM efficiency.
- Sales team quotas increased by more than
10% in 2023 and have remained elevated in 2024 with quota attainment expectations also having expanded from ~70% to ~75% this year, two positive signs that highlight how private SaaS companies are able to navigate today's changing market. - Recent headcount additions to GTM teams indicate optimism moving forward as companies anticipate and prepare for a rebound in 2025.
Companies remain focused on successful execution and improving profitability.
- Major profitability metrics saw a slight improvement in 2023; however, there is an even more pronounced improvement in 2024 as companies continue to focus on operating efficiency and improving their EBITDA margins instead of aggressively pursuing top-line growth.
- Continued budget cuts and a more conservative approach to expense management are anticipated, especially for larger-sized companies with >
$50
Both public and private markets are showing signs of improvement--primarily driven by recent AI developments and a more optimistic view of the macro environment
- Public market software valuations are returning to near-normalized levels at ~5-6x next twelve months (NTM) revenue, compared to the all-time highs of ~17x in 2021.
- Private market financing activity and multiples are beginning to show strength, with high growth companies growing more than
50% commanding super premium multiples of ~14x ARR.
"Primarily driven by the availability of capital and a positive economic outlook, companies invested to pursue aggressive growth targets in 2021-2022. However, many companies scaled back operations and shifted their focus from growth to profitability as we entered 2023," says Scott Peterson, Managing Director, Software Investment Banking at KeyBanc Capital Markets. "Despite this trend continuing into 2024, we see strong long-term prospects for the sector, due to factors such as the continued transition to the cloud and increased adoption of artificial intelligence."
"Over the past year, we saw companies become even more efficient as they learned to do more with less and refined their ideal target customer profiles," said Steve Abbott, Partner at Sapphire Ventures. "Moving forward, we see private company SaaS growth inflecting higher as the macro economy improves and as companies take advantage of AI tailwinds."
Rule of 40 benchmarking, a "best-in-class" SaaS company performance calculated by adding a company's growth rate and profitability margin, is showing signs of improvement amongst private SaaS companies. While none of our surveyed companies are expected to achieve or exceed the Rule of 40 this year, many of them are getting closer to it, primarily due to EBITDA margin improvements.
The KBCM and Sapphire Ventures Private SaaS Company Survey provides credible operational and financial benchmarking data for executives and investors in SaaS companies of all sizes. This includes everything from GTM selling strategies, historical and projected growth, and retention rates, to operational management and margin structures, as well as proprietary data on valuation and exit expectations. This year's survey polled senior executives at more than 100 privately held global SaaS companies with a median 2023 ARR of ~
The information contained in this report has been obtained from sources deemed to be reliable but is not represented to be complete, and it should not be relied upon as such. This report does not purport to be a complete analysis of any security, issuer, or industry and is not an offer or a solicitation of an offer to buy or sell any securities. This report is prepared for general information purposes only.
About KeyBanc Capital Markets
KeyBanc Capital Markets is a leading corporate and investment bank providing capital markets and advisory solutions to dynamic companies capitalizing on opportunities in changing industries. Our deep industry expertise, broad capabilities and unique ideas are seamlessly delivered to companies across the Consumer & Retail, Diversified Industries, Healthcare, Industrial, Oil & Gas, Real Estate, Utilities, Power & Renewables, and Technology verticals. With over 800 professionals across a national platform, KeyBanc Capital Markets has more than
About KeyCorp
KeyCorp's roots trace back nearly 200 years to
About Sapphire
Sapphire is a global software venture capital firm with more than
Notes: (1)AUM (Assets Under Management) represents Sapphire's Regulatory Assets Under Management as of 12/31/2023 per ADV filed March 2024; (2)Figures represent all Sapphire direct growth investments made since the firm's inception in January 2011 through June 2024.(3)Figures represent all Sapphire direct growth investments that have had an IPO or public listing from the firm's inception in January 2011 thru June 2024.The specific companies identified may not be representative of all of Sapphire's investments and no assumption should be made that the investments identified were or will be profitable. A complete alphabetical list of Sapphire's investments made by its direct growth investing funds is available here. |
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SOURCE KeyCorp
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