Sales Science’s Post

Is the SaaS business model really that good? When the most successful pure-play SaaS business can only generate 15% net margins? The promise with SaaS was that because the Gross Margin profile is so strong, once a SaaS company gets to scale they can flip off the OPEX switch and start to mint real profits. But we haven’t seen that with Salesforce. And they’re at $36B in revenue. They have similar net margins to the soft drink industry. Half the net margins of banks and only slightly better margins than Oil and Gas. Saas companies aren’t profitable because they spend too much on Sales and Marketing. Even at $36B Salesforce is spending 35% of revenue here. What happens if they turn this off? We still don’t know because they’ve never done it.

Most sales-driven SaaS companies have about half their headcount in sales This is a great investment and makes sense But it also makes it almost impossible to be profitable until growth slows if you are 90%+ sales-driven There are almost no economies of scale in SaaS sales

I have uploaded the data set which can be used to practice Pareto Analysis. (Earlier today, I uploaded a demo of Pareto Analysis) I created this dataset for a fictional SaaS company. It shows the revenue generated by its various products. It has two files. Saas Product Table and SaaS Sales Fact table. https://lnkd.in/errt8Wa2

Effective revenue management is the cornerstone of any successful business. In Salesforce, Revenue Schedules can help you streamline your revenue recognition processes, and make sure your financial literacy remains top-tier. Find out how in our full article: https://bit.ly/45dTvz3 Or, if you’re more interested in how Salesforce can help your High Tech business in a more general sense, you might want to jump straight in with our Salesforce for SaaS Playbook, which you can download for free, here: https://bit.ly/44n621J #revenue #salesforce #download #cpq

Effective revenue management is the cornerstone of any successful business. In Salesforce, Revenue Schedules can help you streamline your revenue recognition processes, and make sure your financial literacy remains top-tier. Find out how in our full article: https://bit.ly/45dTvz3 Or, if you’re more interested in how Salesforce can help your High Tech business in a more general sense, you might want to jump straight in with our Salesforce for SaaS Playbook, which you can download for free, here: https://bit.ly/44n621J #revenue #salesforce #download #cpq

Can you name 4 SaaS companies doing more than $600K in ARR per employee? How much ARR Hubspot generates for every $1 they spend on S&M? What the median NRR is for public SaaS companies right now? If you think these questions are interesting... You should check out our Q2 SaaS metrics report. We analyze 30+ public SaaS companies like Monday, Hubspot, Salesforce and Crowdstrike Against 15 SaaS metrics like ARR growth rates, NRR, Payback period and Gross Margin. Grab a copy of the report here https://lnkd.in/gC5Cdvsb

Raising prices can feel risky, but undercharging could be holding your SaaS back. How do you know it’s time to adjust? Here are 4 signs to watch for: 🚀Your Value Has Grown Added new features? Expanded your support? If your SaaS offers more value than when you started, your pricing should reflect it. 🛒Your Market Says You’re Too Cheap Are competitors charging more for similar value? If your price feels “too good to be true,” customers might undervalue your product. 📈You’re Struggling to Scale If your pricing doesn’t cover costs or fuel growth, it’s time to revisit. Sustainable margins are key to scaling your SaaS. 💪🏼Customer Demand Remains Strong Low churn? Positive feedback? If customers love your product, they’ll likely see the value in paying more. Pricing isn’t just about numbers, it’s about reflecting the value your SaaS provides. Are you charging what your product is truly worth?

The relationship between SaaS providers and their customers must be built on common ground that balances business objectives, technical dependencies, 3rd party integrations, and a ton of competing priorities & context ... this is our sweet spot. 🚀 SaaS providers: we help you stick to your ethos while providing your customers with a path to adopt. 🏢 SaaS buyers: we help you navigate your integration to make sure you get ROI out of your platform investments. Nimble SA integrates SaaS. We know there's friction ... let's talk about it. https://lnkd.in/edQVEa4j

Pump.co have partnered with SaaS Certain to offer free 6 month access to SaaS Certain when you sign up and onboard with Pump before the end of Q4. SaaS Certain is a brand new cost saving software that instantly identifies unused SaaS licences and save you from needless overspend. Their early access customers have identified hundreds of thousands of dollars in wasted spend, and are already realising their savings! To find out more, and sign up, go to https://lnkd.in/dCxSF-2E Already a Pump customer? You can find out about joining the SaaS Certain early access for 50% off annual subscriptions by registering your interest at https://lnkd.in/dMe-dYRB

Average SaaS companies blame the market conditions for slowing their growth. Remarkable SaaS companies embrace the market conditions to speed up growth. It's a mindset.