SaaS Happiness - A Guide To Measuring and Managing What Matters And Avoiding The Pitfalls

The true value of SaaS companies and their operation health is difficult to measure using traditional financial statements. To more accurately gage financial and operational performance, one needs to look revenue churn, customer acquisition costs, customer lifetime  value and other operational metrics.

 

The beauty of SaaS companies from an investor perspective is that they lend themselves to data driven approach to measuring business performance (more so than other types of companies), making it easier to forecast their growth and therefore valuation.

 

Often overlooked by a SaaS company focussed on high-paced growth, a strong contracting strategy and effective service agreement terms and conditions are essential to success.  There are many pitfalls that can be avoided with some forethought on the part of SaaS companies as they establish standard terms and conditions for customer and other important agreements and set guidelines for negotiating these agreements.   Poorly managing service agreement programs for a SaaS company can lead to undue business risk.  It can impact how efficient and cost-effectively a SaaS company can run its business.  And poorly thought-out agreement terms and business processes can negatively impact the value of the business - both in the near term, as part of a next round financing or at the time the SaaS company is considering a sale transactions.  The good news is that all of this can be avoided. 

 

ALKARIM JIVRAJ of Espresso Capital will walk you through the essential metrics used by leading SaaS investors and SaaS operators companies to measure operational and financial performance, and manage growth investments. 

 

 W IAN PALM of Gowlings will delve into some practical tips that any SaaS company should be able to implement as part of its legal contracting practices and touch on a number of the key pitfalls and how to avoid them.