15 Signs You Have A SaaS Metrics Problem

Numbers don’t lie, but sometimes the stories we tell around them do.

Dave Kellogg, EIR at Balderton Capital and 25-year C-level veteran, shares the top 14 signs that you have a SaaS metrics problem, the five reasons those symptoms exist, and a SaaS metrics maturity model with five layers to help you move the needle at every stage. 

First, let’s deep dive into the 15 ways that people misuse and abuse SaaS metrics. By understanding the problems, you can extract the solutions. 

So if you are outside of fintech and banking, you may not have heard of nCino. But if you’re in the space, it’s a big player.

They’re at almost $500m in ARR, with 1,850 customers, now growing a modest but steady 19% and they have gotten pretty efficient, like most other public SaaS and Cloud leaders. Non-GAAP operating margins are now +17%.

They’ve made a few clever acquistions, but haven’t been immune to macro impacts.  A year ago, growth was at 48%. Today it’s at 19%. Wall Street seems OK with the change however, as nCino is still valued at $3.3 Billon.  Not a huge ARR multiple, but just above the 5x-6x average today.

Let’s dig in.

If you still need to get gifts or a something extra for your team, stop scrolling and look no further, there's a few hours left claim your $200 off for the SaaStr Europa Holiday Savings Event.

SaaStr Europa 2024 is Europe's largest gathering for cloud and SaaS professionals. 

Tickets are normally $619 each - but you can save $200 and grab your Holiday tickets for just $425.

So Jamin Ball at Altimeter Capital probably does the best job of tracking SaaS and Cloud metrics of public companies of anyone out there.

Pulling together new bookings data on all the leading SaaS and Cloud companies, here’s what you see:

New bookings started to decline rapidly in Q2’21, where they peaked — and hit a low in Q1’23.

But since then, they’ve bounced back, if modestly.

So quotas are relatively well understood, if sometimes complicated to get right in practice. Keybanc and Sapphire have some great overall metrics here.

Overall, the median AE closes $750,000 a year, and that’s actually up from 2022 — mainly due to hiring freezes and contractions. 

And how many hit quota?  While different data sources report different numbers, the companies themselves in the Keybanc Sapphire data report 80% hitting quota attainment. That sounds way too high to me, but it’s still useful to see the data represented cleanly here together.

One thing I’ve never really had much data on is exactly below what level of attainment sales reps typically are at risk of losing their jobs, however.  40% attainment?  30%?

Salesforce recently shared theirs in a Bloomberg article:

Their “PIPs” or being put on a performance plan to be managed out kick in now at the following performance levels:

• After 1 quarter of underperformance in sales, not 5-6; and
  If an enterprise rep closes less than $100k a quarter ($400k a year annualized); or
• If an SMB rep closes less than $40k a quarter ($200k a year annualized)

That sounds a bit harsh on the surface, but it actually may be generous, as it likely ties to about 30%-40% attainment. 

Providing robust integrations is an essential part of any B2B SaaS product strategy. Find out if you are ready for an embedded integration platform.

Have you been attending our free, live Workshop Wednesdays with the best in SaaS?

The best of SaaS come every Wednesday at 10am PST on Zoom with hands on presentations, data, advice and live Q+A.

Speakers include 50+ cloud and SaaS leaders already:

• Thomas Tunguz of Theory Ventures
• Jamin Ball of Altimeter
• Mark Roberge of Stage 2 Capital
• MongoDB’s SVP of Sales Ops on Sales Compensation
• Open AMAs with Jason Lemkin

and so, so much more!

The landscape for Go-to-Market (GTM) will be changing over the next 12 months in terms of roles within GTM, in combination with how buyers make purchases and the decision-makers involved. 

During Workshop Wednesday, held every Wednesday at 10 a.m., Mandy Cole, Partner at Stage 2 Capital, shared the five steps every company needs to take to build their first GTM playbook centered around the buyer.

© SaaStr 2023

644 Emerson St. Suite 200, Palo Alto, CA, 94301

If you'd like to stop receiving the SaaStr Daily, click here