How, why, and when to conduct an internal audit The internal audit is seldom talked about, yet undeniably essential to maintaining financial integrity in any SaaS company. It’s the independent voice that helps your organization understand risks and get assurance that your internal controls are working. When you consider the work that goes into a single audit, it’s tempting to “save time” by painting your financial processes in broad strokes and ignoring the fine details. (This is especially true for early-stage SaaS companies that are solely focused on finding product/market fit and generating ..read more

The State of SaaS Valuations: Facts vs. Speculation Breaking the “growth at all costs” mentality Are SaaS cliches like “hypergrowth” and “unicorn status” becoming irrelevant? In the face of a market downturn, SaaS companies are increasingly adopting a “disciplined growth” mindset and breaking the old “growth at all costs” mentality. At times like these, the margin for error is much slimmer for your average SaaS business trying to chart a clear path to profitability and navigate the market downturn unscathed. However, one of the biggest concerns for founders and investors is how the current mar ..read more

Raise, Sell, Merge, or Scale? How to Navigate the Market Downturn. Is it just me, or is it starting to feel a little tight in here? Everyone is starting to feel the squeeze of the market—especially those in the tech space. Seasoned industry vets may know what their next move should be, but navigating a changing market (especially one in a downturn) is an obstacle for any SaaS founder. So far, we’ve seen a slowdown in the venture market due to the drop in the stock market, inflation, an increase in interest rates, and a number of other issues. According to Crunchbase, valuations are declining ..read more

Why SaaS CEOs Should Obsess Over the “Rule of 40” If you ask a SaaS founder or CEO what their top priority is, nine times out of 10, you’ll get a one-word reply: “growth.” It’s easy to see why. Everyone loves to talk about how fast their company is growing, and in recent years investors have rewarded companies that can deliver massive growth. But according to Battery’s latest Cloud Quarterly report, times are changing. Of course, growth still matters. But it isn’t the only thing that matters. Increasingly, investors seek not “growth at any cost” but rather a more measured and sustainable appro ..read more

Is profitability or growth more important to a SaaS company’s valuation in 2022? We looked at the correlation between growth and profits in public SaaS companies to find out. Spoiler alert: it’s still growth The short answer is growth is still 2.5 times more important than profitability in determining a SaaS company’s valuation.  Let’s dig into the data to see why. In the current environment, the correlation between valuation multiples and growth rate is about .39. That’s the lowest correlation we have ever seen in the last 10 years, down from .57 at the peak of the market in November 202 ..read more

Benefits of Optimizing Your FinOps Tech Stack For years, operating out of an ERP was seen as an obvious indicator of a “mature” or “serious” business, but that may no longer be the case. As early-stage and mid-market SaaS companies continue to navigate an ever-changing, volatile market, finance teams need solutions that allow them to prioritize flexibility and scalability above all else. The relative rigidity of ERPs and suite solutions means these aren’t always the perfect fit for growing businesses that need to move fast—kind of like trying to wear a shoe that’s one size too big.  In so ..read more

Avoid the scramble for due diligence, audits, and month-end close Board meetings, due diligence requests, month-end close, auditor requests—how many all-nighters have you endured to ensure your company is well represented? Too many.  Our team has talked to thousands of SaaS finance professionals over the years, and we’ve seen three common challenges finance teams at SaaS companies face: Standing out to investors and passing due diligence Completing month-end-close efficiently Achieving a quick and clean audit In our recent webinar, Stop Pulling All-Nighters: Avoid the scramble for due d ..read more

The State of VC Funding in Europe: How to Raise Capital So, you’ve decided on European venture capital to scale your SaaS.  At this point, you’ve already poured your time and energy into product design, conducted hours-long whiteboarding sessions, and maybe you’ve built a loyal user base. Even after all that hard work, without capital to scale your idea, your progress could screech to a halt. For some European SaaS founders, self-financing and bootstrapping give them the capital they need to scale their operations. Take Hotjar, for example, a website analytics platform that received no ou ..read more

Why you should hold onto your tech stack. For years, operating out of an ERP was seen as an obvious indicator of a “mature” or “serious” business, but that may no longer be the case. As early-stage and mid-market SaaS companies continue to innovate and scale at faster rates, finance teams need solutions that allow them to prioritize flexibility and scalability above all else. The relative rigidity of ERPs and suite solutions means these aren’t always the perfect fit for growing businesses that need to move fast—kind of like trying to wear a shoe that’s one size too big. However, building and i ..read more

Unless you’re determined to bootstrap your way to an IPO, securing funding is one of the first hurdles you’ll have to face to successfully scale a SaaS business.  Early access to capital in the beginning stages of a startup is what allows companies to achieve rapid growth and capture market share before it’s too late, which means securing funding could significantly impact your company’s long-term success. As the pressure to build faster and scale continues to influence the tech space, both SaaS veterans and IPO hopefuls have funding on their minds. But how does one go about securing fund ..read more