Maxio

Maxio helps businesses accelerate growth efficiency with the industry’s only all-in-one billing and financial operations platform purpose-built for B2B SaaS.

Advisor

Extend

At Extend, we help SaaS companies collect cash faster with less manual effort. No more manual emails, Post-it notes, Outlook reminders, and reminders from your CFO.

B2B SaaS finance and accounting teams automate laborious, uncoordinated workflows around account receivables and payment collections. Put your cash collections on auto-pilot and free up staff time.

Co-Founder

The SaaS CFO

Founder

SaaS Metrics Standards Board

Founding Member

The SaaS Academy

Mobile Solutions

Chief Financial Officer

Cartegraph

Revamped the finance and accounting function for a successful exit to private equity.

Vice President and Chief Financial Officer (CFO)

Provided finance and operational leadership to US subsidiary of German-based RIB Group – a leading global provider of ERP software solutions to the construction industry. Responsibilities include all aspects of finance, accounting, tax, treasury, human resources, research and development, services, and support. Hired to bring structure and process improvements to functional areas and execute US and Canadian expansion plan.

Executive Vice President and Chief Financial Officer (CFO)

Pinnacle Airlines Corp.

While Director of FP&A at Pinnacle Airlines Corp., Ben implemented an improved FP&A structure and process to support a rapidly growing organization.  Within his first year, he sourced and implemented a new planning and reporting system to move away from an offline, Excel-based system.  Through this technology and process redesign, his team reduced Pinnacle’s annual budget season from three to two month and introduced a detailed, monthly forecasting package.  Other improvements included new management performance reporting through monthly close packages, leading to earlier corrective action of operating variances.  With better data and analysis, his team created a new cost and revenue allocation system to determine profitability by product line and a more sophisticated process to bid on RFP’s.  Ben also developed Pinnacle’s first external finance training course in partnership with the University of Memphis.

Director, Financial Planning & Analysis (FP&A)

A.D.A.M., Inc.

As the first financial planning and analysis hire, Ben created many "firsts."  This included a weekly revenue forecast for the CEO using bookings data while applying software revenue recognition standards and a complex financial statement forecasting model.  Ben partnered with product managers on investment decision analysis and product pricing reviews to align R&D and related operating expenses with projected product revenues.  He also decoded customer pricing plans from a previously off-shored process.

Manager, FP&A

WHAT I DO:  I help SaaS companies via fractional SaaS CFO services, coaching, and courses in SaaS metrics and finance.  I help companies achieve financial improvement and transparency via a SaaS finance framework that links operations to finance.

WHO I HELP:  I help SaaS founders, finance/accounting, and investors.

WHY IT WORKS:  Translating the operational story into consumable numbers is the key to driving corporate performance and understanding the economics of SaaS businesses.

WHAT MAKES ME DIFFERENT: From debits and credits to financial forecasting to M&A, my experience has not just been silo’ed in the accounting or finance track, but both sides of the desk.  My operations background at several airlines has improved my ability to translate operational performance into improved financial understanding and foresight. My on-the-job experience as a SaaS CFO has allowed me to help thousands of SaaS founders and finance teams.

$10M+ ARR and 90% gross profit margins? Highly unlikely 😲

Chances are...your SaaS P&L is set up incorrectly. 

I've reviewed 100's of SaaS P&Ls and most of them are wrong, some are close, and about 10% are spot on.

Tips and considerations with your SaaS P&L...

1. 💼 P&L Setup for SaaS:

Revenue, COGS, and OpEx. Most SaaS companies get COGS vs. OpEx wrong. This is a big deal.

2. 💰 Gross Margins for SaaS:

You must understand the significance of gross margins for SaaS companies, and the implications of running low or high gross margins, especially when passing $3-5M in ARR.

3. 📊 COGS Versus OpEx in the SaaS P&L:

Unless you are very early-stage, let's say $1M in ARR, you most likely are not running 90% margins. Early-stage, yes, very common b/c usually you only have hosting expenses in COGS at this point.

4. 🎯 Best in Class Gross Margins:

How do you compare against your peers? I consider 80%+ overall gross margins for pure-play SaaS as best in class. The data supports this.

5. 🔢 SaaS Metrics Calculations:

An accurate P&L setup and gross profit numbers are crucial inputs for various SaaS metric calculations and for effectively managing a SaaS business.

Check out below what I consider an "accepted" SaaS P&L format.

If you'd like to download my SaaS P&L format, check out the link below. And please hit LIKE if you found value in this post. Thank you!

#SaaS

Ben Murray

The SaaS CFO | The #1 source for SaaS finance education. Video lessons, content, templates, and communities to accelerate your SaaS and career.

How can I download an accepted SaaS P&L format?

Do you like weekly SaaS metrics tips? 📊

Sneak peek! This GRR post goes out Friday to my SaaS Metrics School subscribers.

📓Key Concepts to Learn💡

1. Gross Revenue Retention (GRR) 📊: 

GRR, also known as gross dollar retention, is a critical metric for assessing the health of a SaaS business's existing customer base. It measures the recurring revenue retained after factoring in only contraction and churn, excluding new customer revenue and expansions. This metric is essential for operators of SaaS businesses and is also a crucial component of due diligence.

2. MRR Schedule 🗓️:

A clean Monthly Recurring Revenue (MRR) schedule is REQUIRED for calculating GRR and is often requested during due diligence. It provides a clear overview of the monthly recurring revenue from existing customers and by product line, which is necessary for deriving the gross revenue retention number.

3. GRR Calculation ➗:

The calculation of GRR involves the existing customer base and factors in only downgrades/contraction and churn. Expansion and new customers are not included in the calculation!!! The metric maxes out at 100%, as any decrease in revenue due to contraction or churn contributes to a reduction in the GRR percentage.

4. Benchmarking GRR 📏:

The benchmarks for good GRR percentages depend on your target market. For mid-market and enterprise customer targets, a GRR of 95% and above is considered best in class. For SMB and B2C customers, the standards will be slightly lower, typically ranging from 70% to 90%, based on the customer segment.

5. SaaS Metrics Framework 🏗️:

GRR is categorized as a must-have metric in my SaaS Metrics Framework (let me know if you want a copy!), specifically in the second pillar, which focuses on retaining customers. The framework emphasizes the importance of not only acquiring customers but also retaining them.

If you like these tips, check out my SaaS Metrics School newsletter and podcast below.

#SaaS

PS. If you'd like my retention template, post "template" in the comments.

How to Conduct Pipeline Reviews 👊

As a CFO, I spend a lot of time understanding our go-to-market engine. I don't have to be an expert, but I must understand the goals, conversion points, and strategy of our sales and marketing teams.

On May 1st, I'm bringing in guest expert Eddie Reynolds to The SaaS Academy.

Get your pen and paper ready, b/c Eddie will tackle the following:

➡️ Revenue Efficiency Pyramid: a proprietary model designed to measure your company’s operational maturity and identify the most critical bottlenecks hindering growth.

➡️How to prioritize projects and align your teams towards large strategic goals using a RevOps Roadmap. 

➡️How to conduct Pipeline Reviews, a process used to spot issues in the sales process and reinforce optimal pipeline management.

Sound good? Great! Save your seat with the link below.

My last webinar attracted 1,000+ 🚀 of your SaaS colleagues, so we might hit the Zoom limit on this one.

Save your seat here: https://lnkd.in/gxFkwCGs

#SaaS

What MRR number am I really looking at? 😲

MRR can have a lot of different meanings...

- Contracted MRR
- Rev rec'd MRR
- MRR from bookings data
- Exit rate, CMRR, and on!

I was talking recently to a SaaS founder who was getting a lot of questions from accountants on why the MRR number on a dashboard didn't match the number on the SaaS P&L.

Especially if this number is coming from a dashboard, we have to understand its source ❗❗❗

In episode #182 of SaaS Metrics School, I address the nuances of MRR. We could be talking about an accounting number, a CRM number, and a number from who knows where.

Check out the short episode at the link in the comments.

#SaaS

"My bookkeeping is a mess!"

I heard this a lot from founders at Nathan Latka's SaaS Open this past week in Austin.

It doesn't have to be this way, but you can find yourself running financially blind in a hurry.

With the couple tips below, you'll pass 90% of the SaaS companies out there when it comes to your accounting setup.

1) SaaSify your chart of accounts

>>> this means you need enough detail in your general ledger accounts to code revenue by type (subscription vs. variable, for example) and expenses (focus first on employee and contractor-related expenses).

2) Code to the department level

>>> this means that every expense must be coded to a department. Don't lump wages into one big bucket. You'll never create the SaaS P&L below. This gets founders into so much trouble when they really must understand their spend.

3) Create the proper SaaS P&L format

>>> see below for an example. You can take SO MUCH from this P&L. It also feeds your SaaS metrics.

We can worry about rev rec and cash vs. accrual later. The steps above are foundational to understanding your revenue growth and your spend.

#SaaS

Do you know the average length of your Sales Cycle?

Believe it or not, this has a huge impact on how you calculate your sales and marketing efficiency metrics.

SaaS metrics formulas can appear straight forward but sales cycle length is a KEY nuance.

Measure the wrong time period and your S&M efficiency metrics will be inaccurate.

For example, when you calculate CAC, are you taking 1 month of data, 6 months of data, 12 months of data?

You must align your period of measurement with your sales cycle length.

Check out episode 184 in the comments below for more on sales cycle length and S&M efficiency metrics.

#SaaS

Some big funding rounds lately 💰💰💰

Normal course of business or capital anxious to get back to work?

I went back to March 1, 2024 and sorted by the largest rounds that we have covered at The SaaS News.

> Cyera Raises $300 Million in Series C https://lnkd.in/d7DQncBz

> Applied Intuition Raises $250 Million in Series E https://lnkd.in/dDMBZtpF

> Axonius Secures $200 Million in Series E Extension https://lnkd.in/dnXWxeMR

> Cohesity Raises $150 Million in Series F https://lnkd.in/dDK9kv-4  

> Pigment Raises $145 Million in Series D https://lnkd.in/d3JsPzDi   

> Guesty Secures $130 Million in Series F https://lnkd.in/dXcikHPh   

> The Brandtech Group Secures $115M in Series C https://lnkd.in/d2EDnzPU

> Observe Closes $115 Million in Series B https://lnkd.in/dNbttbKh   

> Luminary Cloud Raises $115 Million in Funding https://lnkd.in/dKkva_QD

> Zephyr AI Closes $111 Million in Series A https://lnkd.in/dy7KZayp   

> Mews Secures $110 Million in Series D https://lnkd.in/dhF4sBBa   

> Together AI Raises $106 Million in Funding https://lnkd.in/deZfxMHt

> FloQast Secures $100 Million in Series E https://lnkd.in/deBgdJYh   

> Coro Secures $100 Million in Series D  https://lnkd.in/dbx3AfWe   

> FundGuard Closes $100 Million in Series C https://lnkd.in/dZTxXArt 

thesaasnews.com • 2 min read

Cyera Raises $300 Million in Series C | The SaaS News

College Dropout to 7M Followers to SaaS Founder

Cole has done so much so early in his career. There are a ton of learnings in this episode. I got to know Cole when he was a student in The SaaS Academy. 

He invested in himself to understand the economics that drive SaaS companies.

You'll enjoy this episode...

🚀 Cole Gonzales, CEO of ossa.ai , shares his journey from dropping out of college to leading a promising startup in the AI-driven content creation space.

Here are three key takeaways from our conversation:

💡 Bootstrapping Benefits: Cole walked us through the strategic decision to bootstrap Ossa AI and the impact it's had on company control and product development. The company's early success, hitting $10,000 in MRR, showcases the potential for startups to grow without immediate external funding.

🎯 Customer Understanding: A deep dive into Ossa AI's user behavior underpins the importance of identifying the ideal customer profile. Catering to diverse use cases - from personal branding to sales outreach - illustrates the versatility of Ossa AI's platform and the need for SaaS companies to remain agile in responding to client needs.

👥 Community and Communication: Cole emphasized the role of community in Ossa AI's growth, leveraging a 25,000-30,000 member Discord audience as a foundation. Additionally, the focus on open communication, especially when handling service downtime, reinforces customer support as a critical pillar for SaaS enterprises.

Episode 106 is now available, links down below 👇

YouTube: https://lnkd.in/gnkk9DCk
Apple: https://rpb.li/tgVFdD
Google: https://rpb.li/kVW
Spotify: https://rpb.li/7pwzP5

#SaaS

Cole, founder of ossa.ai, knows a thing or two about communities and followers. 

Once he had an MVP, he hit up his community for the first beta testers of his product.🙋

Join us as Cole Gonzales shares insights into beta testing strategies that led to extraordinary results.

Episode 106 is now available👇at the link in the comments.

Tune in for invaluable lessons on product testing, community engagement, and rapid growth.

He discloses his MRR on the podcast. He's already broken through that number.

#SaaS

I'm sharing this Series B chart in my newsletter today 📊

You can definitely notice a trend in Series B round volumes for SaaS and technology companies.

2022 Roundsize Highlights 💰

25th % $22,000,000
Median: $33,500,000
75th %: $50,000,000 

2023 Roundsize Highlights 💰

25th % $20,000,000
Median: $28,000,000
75th %: $50,000,000 

Catch this report and more in my newsletter today. Subscribe at the link in the comments.

#SaaS

Fundamentals are called "fundamentals" for a reason. 👍

CAC, or customer acquisition costs, is a ubiquitous SaaS metric. But we don't start with unit-cost CAC 😨. That's what everyone talks about.

We must start with our gross CAC expenses.

In tomorrow's post and newsletter, I'm building the foundation of CAC. Get the foundation wrong and all of your sales and marketing efficiency metrics will be wrong.

The foundation post will cover:

> What is CAC
> Gross CAC expenses
> Unit-cost CAC
> CAC expense data source
> Customer count data source
> Downline metrics impact
> New vs. existing allocation
> What's your prize?
> GTM impact on CAC
> Segmentation

CAC seems so easy, but to get it dialed in, you must consider a lot of nuances.

Get tomorrow's post by subscribing at the link below. See you then!

#SaaS

Covering a lot of ground in tomorrow's SaaS newsletter 📰

Plus some great live events including The RevOps Playbook for Revenue Efficiency.

Join 61K of your SaaS peers at the link in the comments.

Highlights:

😯 Should we include Customer Success cost in our CAC?
💰 $20M raised to manage the mix of in-person and remote workplaces
🔢 Download my Pre-seed to Series F funding report
🚀 Your peers’ SaaS tech stack - this is NOT a market map
❇️ Grab my 5 Pillar SaaS Metrics Framework and free training session
📊 The 4 key finance data sources to improve your financial maturity
💵 Great post on raising pre-seed and seed money by Ben Yoskovitz

See you soon!

#SaaS

Are you truly leveraging the power of your SaaS P&L?

The properly constructed SaaS P&L is a financial pillar in the management of your SaaS company.

Some quick tips...

1. 💼 P&L Setup for SaaS:

Understanding the correct setup of Profit and Loss (P&L) statements for SaaS companies, particularly in distinguishing between cost of goods sold (COGS) and operating expenses (OpEx) in the P&L is critical. The major sections include Revenue, COGS, and OpEx.

2. 💰 Gross Margins for SaaS:

You must understand your gross margin profile! And by revenue stream. If you are reporting 90% GP and you are over 10M in ARR, I will question your SaaS P&L setup. 80% is your best-in-class target at scale.

3. 📊 COGS Versus OpEx in the SaaS P&L:

It's important to accurately categorize costs as COGS or OpEx in the context of SaaS P&L to ensure accurate financial reporting and management. Remember the 90% margin above? Probably wrong. In all of my coaching calls, it's never quite right.

4. 🎯 Best in Class Gross Margins:

80% gross margin for pure-play SaaS at scale.

5. 🔢 SaaS Metrics Calculations:

Your P&L data feeds critical SaaS metrics. An accurate P&L setup and gross profit numbers are crucial inputs for various SaaS metric calculations.

Check the comment section for more resources.

#SaaS

Want to build your Sales Pipeline in a smart and efficient way? 🌊

I'm bringing in ​guest expert, Eddie Reynolds of Union Square Consulting, on May 1st to help the SaaS community.

Are your sales figures lagging despite a committed team?

Strategic RevOps optimizes the processes and systems that maximize return on effort. But with seemingly endless ways to create operational efficiencies, knowing where to start is the hardest part.

In this webinar, we’ll introduce the:

-> Revenue Efficiency Pyramid, a proprietary model designed to measure your company’s operational maturity and identify the most critical bottlenecks hindering growth.

We’ll also show you how to:

-> Prioritize projects and align your teams towards large strategic goals using a RevOps Roadmap. 

-> How to conduct Pipeline Reviews, a process used to spot issues in the sales process and reinforce optimal pipeline management.

Sound good? Great! Save your seat with the link in the comments.

My last webinar attracted 1,000+ 🚀 of your SaaS colleagues, so we might hit the Zoom limit on this one.

#SaaS #Sales #Pipeline

🎙️ Just wrapped up a great conversation with Tanguy Chau, co-founder and CEO of Paxton, on The SaaS CFO Podcast. 

Here are some key takeaways from our discussion:

➡️ **Product Innovation**: Paxton is leading the way in generative AI legal and regulatory assistance, aiming to revolutionize the legal research and drafting process.

➡️ **Go-to-Market Strategy**: Tanguy emphasized the importance of a product-led growth strategy, leveraging inbound interest and extensive content creation to reach their target audience, including attorneys at medium and large law firms, as well as general counsels and corporations.

➡️ **Early-Stage Insights**: Tanguy shared valuable insights for early-stage founders, highlighting the significance of understanding and validating market needs, while emphasizing the critical question: "What do you do uniquely that people are desperate for?"

Thank you Tanguy Chau for sharing your insights and the exciting developments at Paxton.

Episode 107 is now available at these links 👇

YouTube: https://lnkd.in/gfFVRgZB
Apple: https://rpb.li/tgVFdD
Google: https://rpb.li/kVW
Spotify: https://rpb.li/7pwzP5

#SaaS #AI

Have SaaS questions but not sure where to find the answers❓

6,500+ SaaS professionals have joined my SaaS community to...

- network
- find jobs
- post jobs
- ask questions
- join free training sessions
- learn from SaaS experts

Join at this link and introduce yourself: https://lnkd.in/gv85J8ip

See you in the community!

Ben

#SaaS

500+ have registered for my upcoming SaaS community events 🚀

I'm hosting SaaS experts who can help your business on April 24th and May 1st.

April 24th ⬅️

Julio Martínez, CEO and co-founder, and James Ferguson, Sales Engineer at Abacum join me live. We're tackling revenue planning for finance.

Save your seat: https://lnkd.in/g4h42pqQ

May 1st ⬅️

How's the data in your sales pipeline? Eddie Reynolds of Union Square Consulting joins us live to talk pipeline reviews and his Revenue Efficiency Pyramid. 

Save your seat: https://lnkd.in/gxFkwCGs

#SaaS

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