In episode #146, I address the timestamp on a customer cancellation. This is a very common question. Customer Success often tracks this differently than finance. But the date impacts our metrics. - What date should I use? - Impact on metrics Subscribe to Ben’s SaaS metrics newsletter: https://saasmetricsschool.beehiiv.com/subscribe Subscribe to Ben’s SaaS monthly newsletter: https://mailchi.mp/df1db6bf8bca/the-saas-cfo-sign-up-landing-page SaaS Metrics courses here: https://www.thesaasacademy.co...
Dec 10, 2023•3 min
In episode #145, I address headcount allocations. It’s very common to allocate headcount expense in early-stage SaaS companies. But we have to support the allocation with proper logic and reasoning. - Should I allocate headcount? - Allocating engineering time - COGS vs. OpEx Subscribe to Ben’s SaaS metrics newsletter: https://saasmetricsschool.beehiiv.com/subscribe Subscribe to Ben’s SaaS monthly newsletter: https://mailchi.mp/df1db6bf8bca/the-saas-cfo-sign-up-landing-page SaaS Metrics courses h...
Dec 09, 2023•3 min
In episode #144, I address pilot and POC revenue. It’s important to separate this from your “normal” customer revenue and bookings. - Bookings - Revenue - Metrics Subscribe to Ben’s SaaS metrics newsletter: https://saasmetricsschool.beehiiv.com/subscribe Subscribe to Ben’s SaaS monthly newsletter: https://mailchi.mp/df1db6bf8bca/the-saas-cfo-sign-up-landing-page SaaS Metrics courses here: https://www.thesaasacademy.com/ Join Ben’s SaaS community here: https://www.thesaasacademy.com/offers/ivNjwY...
Dec 08, 2023•4 min
In episode #144, I talk retention and ARR targets. My template and lesson below are very helpful for your Customer Success and Account Management teams to set targets. - Retention targets - Expansion ARR targets - Many variables affect this analysis Video lesson and template (under the retention module): https://www.thesaasacademy.com/offers/gmbMDsYN/checkout Subscribe to Ben’s SaaS metrics newsletter: https://saasmetricsschool.beehiiv.com/subscribe Subscribe to Ben’s SaaS monthly newsletter: ht...
Dec 07, 2023•4 min
In episode #142, I talk gross profit in SaaS. Gross profit or gross margin is a fundamental financial topic that every SaaS founder, CFO, and operator must understand. - What is gross margin? - Important to calculate by revenue stream - When should I be worried? Blog post: https://www.thesaascfo.com/how-to-calculate-saas-gross-margin/ Subscribe to Ben’s SaaS metrics newsletter: https://saasmetricsschool.beehiiv.com/subscribe Subscribe to Ben’s SaaS monthly newsletter: https://mailchi.mp/df1db6bf...
Dec 06, 2023•4 min
In episode #141, I take a look at the latest SaaS public company trends. Today, let’s look at implied ARR per FTE trends. - ARR per FTE trends - Why is this important? Subscribe to Ben’s SaaS metrics newsletter: https://saasmetricsschool.beehiiv.com/subscribe Subscribe to Ben’s SaaS monthly newsletter: https://mailchi.mp/df1db6bf8bca/the-saas-cfo-sign-up-landing-page SaaS Metrics courses here: https://www.thesaasacademy.com/ Join Ben’s SaaS community here: https://www.thesaasacademy.com/offers/i...
Dec 05, 2023•3 min
In episode #140, I take a look at the latest SaaS public company trends. Today, let’s look at net revenue retention. - Public NRR trends - Private company NRR benchmarks Benchmark your company at Benchmarkit.ai How to calculate net revenue retention: https://www.thesaascfo.com/how-to-calculate-net-dollar-retention/ Subscribe to Ben’s SaaS metrics newsletter: https://saasmetricsschool.beehiiv.com/subscribe Subscribe to Ben’s SaaS monthly newsletter: https://mailchi.mp/df1db6bf8bca/the-saas-cfo-si...
Dec 04, 2023•3 min
In episode #139, I address org efficiency and scaling. Eventually, you need good employee and contractor efficiency to reach profitability and improve your odds of scaling big. This is there the ROSE Metric comes into play. - Org efficiency - ROSE Metric ROSE metric template and post: https://www.thesaascfo.com/saas-rose-metric/ Subscribe to Ben’s SaaS metrics newsletter: https://saasmetricsschool.beehiiv.com/subscribe Subscribe to Ben’s SaaS monthly newsletter: https://mailchi.mp/df1db6bf8bca/t...
Dec 03, 2023•4 min
In episode #138, I address the challenge of scaling past $10M in ARR. This is an interesting stat from SaaStock. There are so many business components that get you to $10M ARR. One key component will be your financial infrastructure so that you can make better decisions with your available capital. - 0.4% stat - Your financial roadmap to scaling - Discount code to SaaStock USA in Austin (SAAS-CFO-20) Register for SaaStock USA here: https://www.saastock.com/saastock-usa/ 5 Pillar Framework Downlo...
Dec 01, 2023•4 min
In episode #137, I address a common financial trait from my experience helping SaaS companies from the $3M ARR to $15M ARR range. It’s org efficiency. - What is org efficiency? - Why is org efficiency important? - Revenue per FTE - ROSE Metric Subscribe to Ben’s SaaS metrics newsletter: https://saasmetricsschool.beehiiv.com/subscribe Subscribe to Ben’s SaaS monthly newsletter: https://mailchi.mp/df1db6bf8bca/the-saas-cfo-sign-up-landing-page SaaS Metrics courses here: https://www.thesaasacademy....
Nov 30, 2023•5 min
In episode #136, I address the jargon of SaaS. ACV and ARPA are important concepts to understand and track in your business. What if legacy users on different contracts? - What is ACV? - What is ARPA - Segmenting our customer base Subscribe to Ben’s SaaS metrics newsletter: https://saasmetricsschool.beehiiv.com/subscribe Subscribe to Ben’s SaaS monthly newsletter: https://mailchi.mp/df1db6bf8bca/the-saas-cfo-sign-up-landing-page SaaS Metrics courses here: https://www.thesaasacademy.com/ Join Ben...
Nov 29, 2023•3 min
In episode #135, I address a student question about software discounts. We love to discount software. Even back in my on-premise, perpetual days, we were always discounting software. Discounts are okay but we need an approval policy in place. - Discount approval process - Tracking discounts - Impact on gross margin
Nov 28, 2023•4 min
In episode #134, I address SaaS valuations. You need to be roughly aware of where you fall in the valuation spectrum. This helps when you are speaking to potential buyers and sellers. Be sure to check out my in-depth software M&A update episode at the link below. - Where do you fall? Software M&A update episode: https://podcasts.apple.com/us/podcast/4q23-software-m-a-update/id1579374247?i=1000634899770 Subscribe to Ben’s SaaS metrics newsletter: https://saasmetricsschool.beehiiv.com/subs...
Nov 27, 2023•3 min
In episode #133, I address employee expense coding. Since our SaaS P&L is comprised of mostly employee expenses, we must code these correctly. - Wages, taxes, benefits - Where do I code pizza parties? Subscribe to Ben’s SaaS metrics newsletter: https://saasmetricsschool.beehiiv.com/subscribe Subscribe to Ben’s SaaS monthly newsletter: https://mailchi.mp/df1db6bf8bca/the-saas-cfo-sign-up-landing-page SaaS Metrics courses here: https://www.thesaasacademy.com/ Join Ben’s SaaS community here: ht...
Nov 25, 2023•3 min
In episode #132, I address contractor coding. It’s very common to use a lot of contractors in early stage companies. But we must code these expenses correctly. - Contractor - Coding by department Subscribe to Ben’s SaaS metrics newsletter: https://saasmetricsschool.beehiiv.com/subscribe Subscribe to Ben’s SaaS monthly newsletter: https://mailchi.mp/df1db6bf8bca/the-saas-cfo-sign-up-landing-page SaaS Metrics courses here: https://www.thesaasacademy.com/ Join Ben’s SaaS community here: https://www...
Nov 24, 2023•2 min
In episode #131, I address the CFO’s utopia of quote to cash. What really happens when we land a customer? - Bookings - Invoicing - Rev rec - Cash collection Subscribe to Ben’s SaaS metrics newsletter: https://saasmetricsschool.beehiiv.com/subscribe Subscribe to Ben’s SaaS monthly newsletter: https://mailchi.mp/df1db6bf8bca/the-saas-cfo-sign-up-landing-page SaaS Metrics courses here: https://www.thesaasacademy.com/ Join Ben’s SaaS community here: https://www.thesaasacademy.com/offers/ivNjwYDx/ch...
Nov 23, 2023•3 min
In episode #130, I address the world of dates in subscription businesses. Such simple data but often overlooked and not tracked. We need dates to drive correct invoice dates and revenue recognition periods. - Contract dates - Invoice dates - Dates and revenue recognition Subscribe to Ben’s SaaS metrics newsletter: https://saasmetricsschool.beehiiv.com/subscribe Subscribe to Ben’s SaaS monthly newsletter: https://mailchi.mp/df1db6bf8bca/the-saas-cfo-sign-up-landing-page SaaS Metrics courses here:...
Nov 22, 2023•3 min
In episode #129, I address the world of professional services metrics. Backlog in months is an important metrics for our services team. Calculating this number helps us understand the balance between backlog and services capacity. - What is services backlog? - What is backlog in months? - The backlog tradeoffs Subscribe to Ben’s SaaS metrics newsletter: https://saasmetricsschool.beehiiv.com/subscribe Subscribe to Ben’s SaaS monthly newsletter: https://mailchi.mp/df1db6bf8bca/the-saas-cfo-sign-up...
Nov 21, 2023•3 min
In episode #128, I address the often-missing FTE report. This is a standard report that should be produced as part of your monthly close process. - What is an FTE? - Where does the data come from? - Importance of headcount coding - Use of the FTE report (documenting historical trends, rev per fte, variance analysis, serves as the headcount base for the forecast) Subscribe to Ben’s SaaS metrics newsletter: https://saasmetricsschool.beehiiv.com/subscribe Subscribe to Ben’s SaaS monthly newsletter:...
Nov 20, 2023•5 min
In episode #127, I address a common question in the progression of our SaaS metrics. As our SaaS business scales, we have to implement additional metrics to guide the business. - 5 Pillar SaaS Metrics Framework - Questions that I ask first - What S&M metrics should I implement? Use my 5 Pillar SaaS Metris Framework ( https://www.thesaascfo.com/downloads/five-pillar-metrics-framework/ ) Subscribe to Ben’s SaaS metrics newsletter: https://saasmetricsschool.beehiiv.com/subscribe Subscribe to Be...
Nov 18, 2023•3 min
In episode #126, I address cohort analysis and when this framework is the right fit for your SaaS business. - What is cohort analysis? - Basic cohort analysis - Advanced cohort analysis - Are you high ACV or low ACV? Subscribe to Ben’s SaaS metrics newsletter: https://saasmetricsschool.beehiiv.com/subscribe Subscribe to Ben’s SaaS monthly newsletter: https://mailchi.mp/df1db6bf8bca/the-saas-cfo-sign-up-landing-page SaaS Metrics courses here: https://www.thesaasacademy.com/ Join Ben’s SaaS commun...
Nov 17, 2023•3 min
In episode #125, I address an interesting report from Vertice.one on SaaS inflation. There is an art and science to increasing your prices. This fits nicely with a price increase question from a coaching client. - Are you raising your prices? - Don’t conflict with your terms and conditions - SaaS inflation Vertice report: https://www.vertice.one/inside-saas/reports/saas-inflation-index/ Subscribe to Ben’s SaaS metrics newsletter: https://saasmetricsschool.beehiiv.com/subscribe Subscribe to Ben’s...
Nov 16, 2023•5 min
In episode #124, I address the COGS, or Cost of Goods Sold, departments on your SaaS P&L. There are four common departments with pure play SaaS. - Technical Support - Customer Success - Professional Services - Dev Ops Subscribe to Ben’s SaaS metrics newsletter: https://saasmetricsschool.beehiiv.com/subscribe Subscribe to Ben’s SaaS monthly newsletter: https://mailchi.mp/df1db6bf8bca/the-saas-cfo-sign-up-landing-page SaaS Metrics courses here: https://www.thesaasacademy.com/ Join Ben’s SaaS c...
Nov 15, 2023•3 min
In episode #123, I address the major revenue categories in SaaS. It’s important to set this up correctly. It impacts how you manage your business and your metrics. - Subscriptions - Variable - Professional Services - Managed Services - Hardware - Other Subscribe to Ben’s SaaS metrics newsletter: https://saasmetricsschool.beehiiv.com/subscribe Subscribe to Ben’s SaaS monthly newsletter: https://mailchi.mp/df1db6bf8bca/the-saas-cfo-sign-up-landing-page SaaS Metrics courses here: https://www.thesaa...
Nov 14, 2023•3 min
In episode #122, I address a big metrics and sometimes a controversial metric. It’s your ARR. Can you really define your ARR? And is that definition appropriate? We are still in the Wild West of SaaS metrics. - A slam dunk version of ARR - Can I include usage-based revenue in ARR - What about services revenue? - ARR and valuations Subscribe to Ben’s daily metrics newsletter: https://saasmetricsschool.beehiiv.com/subscribe Subscribe to Ben’s SaaS monthly newsletter: https://mailchi.mp/df1db6bf8bc...
Nov 13, 2023•4 min
In episode #121, I cover internal use software and software embedded in our SaaS app. It’s easy to confuse where this spend should be posted to our SaaS P&L - Internal use software - Software embedded in our SaaS app Subscribe to Ben’s daily metrics newsletter: https://saasmetricsschool.beehiiv.com/subscribe Subscribe to Ben’s SaaS monthly newsletter: https://mailchi.mp/df1db6bf8bca/the-saas-cfo-sign-up-landing-page SaaS Metrics courses here: https://www.thesaasacademy.com/ Join Ben’s SaaS c...
Nov 11, 2023•3 min
In episode #120, I cover a somewhat debated topic on ARR. Of course, this is debated between buyers and sellers. If I’m trying to achieve a specific ARR multiple, what ARR number should I use? - Trailing revenue? - Exit ARR? - CARR? Subscribe to Ben’s daily metrics newsletter: https://saasmetricsschool.beehiiv.com/subscribe Subscribe to Ben’s SaaS monthly newsletter: https://mailchi.mp/df1db6bf8bca/the-saas-cfo-sign-up-landing-page SaaS Metrics courses here: https://www.thesaasacademy.com/ Join ...
Nov 10, 2023•3 min
In episode #119, I cover committed annual recurring revenue (CARR). Yet, another SaaS metric. It can also be called contracted annual recurring revenue. It was an obscure metric, but now it is widely used even if you don’t call it CARR. - What is CARR? - What are the components of CARR? - SaaS valuations
Nov 09, 2023•4 min
In episode #118, I cover an important sales and marketing efficiency metric, the Cost of ARR. As our GTM team scales, it usually splits into new business hunters and the “farmers,” or our expansion team. We can calculate the cost of ARR expansion and benchmark our performance. - Fully-burdened sales and marketing expense - Allocate between new and existing - Pick your time period and average sales cycle - Benchmark your performance Cost of ARR blog post: https://www.thesaascfo.com/saas-cac-ratio...
Nov 08, 2023•4 min
In episode #117, I provide an overview of the all-important utilization metric for professional services teams. Not calculating it? Then you don’t know if your team is burning out or if they have capacity to take on more customer projects. - What is an FTE? - What is billable utilization? - Interaction between utilization and backlog Subscribe to Ben’s daily metrics newsletter: https://saasmetricsschool.beehiiv.com/subscribe Subscribe to Ben’s SaaS monthly newsletter: https://mailchi.mp/df1db6bf...
Nov 07, 2023•4 min
