Now more than ever, private equity firms and strategic buyers prioritize profitability when analyzing potential acquisition targets. They want to know that your company can make money, operate efficiently, and…
Running a thriving software business requires, among other things, two foundational capabilities. First, you must find ways to acquire new customers without overspending on sales and marketing. Second, you need…
If you’re selling your software business, it’s essential to understand key financial variables that may impact the process. One such metric is net working capital (NWC). However, when it comes…
The "Rule of 40" in SaaS valuations is a rule of thumb used to assess a company's financial health and growth potential. It suggests that the sum of a company's…
In previous posts, we discussed the importance of understanding ARR and how to properly calculate customer and ARR churn. In this post, we’ll explain how viewing these metrics in conjunction…
The following content has been updated as of December 2023. While the software M&A market feels the impact of some of the same macroeconomic forces affecting public companies, it’s important…
“Gross margin” is likely a term you’ve heard floating around the SaaS industry, and for a good reason: it serves as an essential metric for businesses in the software space.…
Achieving profitable growth is the top priority for most SaaS businesses. So, naturally, business owners want to know the best way to get bigger faster, without undermining their financial stability…
Most SaaS founders have a clear vision for their business. They are focused on creating new products, finding new markets, and attracting new customers. However, there may be a significant…
While Cost of Goods Sold, or COGS as it's known in the world of accounting, is a seemingly straightforward principle, it is frequently miscalculated by software company entrepreneurs. COGS is…
