Key Metrics in SaaS Benchmarking

SaaS BenchmarkingOur SaaS Benchmarking methodology helps you identify the key metrics of your business at different stages of its life cycle. Sales benchmarking gives you valuable insights to correctly model your company’s sales compensation. Financial benchmarking helps you see how your company performs against other companies.

Insights on SaaS Benchmarking

Traditional software companies, selling with a perpetual software license model, want to move to a SaaS model. They must create and implement a plan with realistic financial goals, and then measure their progress and success. This process can be very challenging to companies without SaaS business experience or access to SaaS benchmarks because they lack the relevant SaaS metrics and the means of comparison.

SaaS companies must focus on the right metrics for each stage of their product growth lifecycle.

  • Early stage startups building a minimum viable product must validate customer willingness to pay to use the product, and ensure financing and cash to survive. To measure their progress, they have to focus on churn, feature use, and survival financing.
  • Later stage startups that have verified the product-market-fit must be able to cost-effectively capture customers and grow sales by ramping their marketing and sales processes. Key metrics include churn, cost-of-customer acquisition, and growth financing.
  • Growth companies scaling their business must expand their value proposition. They must move beyond their initial customer segment, and increase their geographic scope. They must also build the organizational processes to help them do both. Their focus is on key metrics such as customer acquisition cost (CAC), customer lifetime value (CLTV), customer segmentation, and geographic expansion.

Software and SaaS vendors alike want to access and analyze reliable sources of information. They want the realistic, valuable benchmarks of private companies, together with the benchmarks from the achievements of public companies in the software, SaaS, and hybrid market spaces.

iStock_000007230894_LargeService and Benefits:

Based on your lifecycle stage, the MoveToSaaS network taps into a broad array of publicly available benchmarks and the OpexEngine database. OpexEngine provides access to the largest source of benchmarks for private and venture-backed companies in the software, SaaS and hybrid space. It also provides access to EDGAR Online, the premier source of benchmarks for more than 16,000 public companies across any industry.

With OpexEngine, we offer financial and performance metrics with relevant data and targets across five major functional categories:  finance & administration, sales & marketing, customer success, R&D (incl. COGS and hosting), and human resources.

Our clients learn how to measure their success via peer-group benchmarking and growth benchmarking. Comparing their data against peer groups enables them to set realistic targets.  Growth benchmarking lets them to understand which targets should be achieved in the future. This helps them to coordinate their efforts and expectations.

Your entire team will understand how their activities and responsibilities impact the economics of running your SaaS business based on the latest business model information. Users can easily create and share interactive charts to visualize their performance against benchmarks, and download all data to Excel.

Of course, we also store and protect your data following best security practices. We encrypt sensitive data and substitute identifiable content with similar, but factitious data from a predefined list (data masking.)

Leveraging the benchmarks, we create a baseline financial scenario by feeding accurate SaaS benchmarking market data into our modeling module. As a software vendor, you can quickly evaluate the overall economic implications of migrating to a SaaS model. Alternatively, as a SaaS company, you can conduct long term planning by anticipating your future position along the growth curve.