8 ms·

Revenue Doesn’t Matter

27 points by bretthardin 14y ago

smalter 14y ago
The less sensational title: Revenue alone doesn't matter, you have to consider it in context. If the question is purely, "What is a ballpark MRR for a Series A SaaS company?", this is a helpful thread: http://www.quora.com/Software-as-a-Service-SaaS/What-are-average-revenues-MRR-or-ARR-for-SaaS-companies-at-the-time-of-the-Series-A http://www.quora.com/Software-as-a-Service-SaaS/What-are-ave...
- mikegioia 14y ago
  Wow, the top post in that quora topic says $2M in ARR for an unproven team before they get any VC money. That seems kinda high to me. I feel like the team's proven themselves after a couple hundred grand of annual revenue.
  - abolibibelot 14y ago
    "A couple hundred grand" is what a freelancer who charges well makes in a year.
    - mikegioia 14y ago
      Yea but we're talking about a company with a business model that isn't "freelancing". I'm assuming a few hundred thousand dollars isn't the upper bound like it would be for a freelancer.
JacksonGariety 14y ago
Title is misleading. @Smalter's suggestion is far more accurate.
casca 14y ago
TL;DR: Some guy on Twitter says "VCs will fund any company with a Series A if they are making $2,750 a day". The author disagrees and says that there are 3 things that are important: market, growth rate and margin.
- kkowalczyk 14y ago
  Corrections: 1. "Some guy" = Jason Calacanis. 2. "on Twitter" = http://blog.launch.co/blog/there-is-no-series-a-crunch.html http://blog.launch.co/blog/there-is-no-series-a-crunch.html
jspaur 14y ago
Suggested Title: Revenue alone won't get you VC
yurylifshits 14y ago
In my view, for Round A you need revenue and the following three: 100M$+ market volume Margins Distribution strategy Distribution strategy is better property to focus on than growth rate. All these week-over-week or month-over-month numbers can be gamed. And keep in mind "Crossing the Chasm" challenge. Your growth rate among early adopters has nothing to do with your ability to win the mainstream market.

27 points by bretthardin 14y ago

The less sensational title: Revenue alone doesn't matter, you have to consider it in context. If the question is purely, "What is a ballpark MRR for a Series A SaaS company?", this is a helpful thread: http://www.quora.com/Software-as-a-Service-SaaS/What-are-average-revenues-MRR-or-ARR-for-SaaS-companies-at-the-time-of-the-Series-A http://www.quora.com/Software-as-a-Service-SaaS/What-are-ave...

mikegioia 14y ago
Wow, the top post in that quora topic says $2M in ARR for an unproven team before they get any VC money. That seems kinda high to me. I feel like the team's proven themselves after a couple hundred grand of annual revenue.
- abolibibelot 14y ago
  "A couple hundred grand" is what a freelancer who charges well makes in a year.
  - mikegioia 14y ago
    Yea but we're talking about a company with a business model that isn't "freelancing". I'm assuming a few hundred thousand dollars isn't the upper bound like it would be for a freelancer.

JacksonGariety 14y ago

Title is misleading. @Smalter's suggestion is far more accurate.

casca 14y ago

TL;DR: Some guy on Twitter says "VCs will fund any company with a Series A if they are making $2,750 a day". The author disagrees and says that there are 3 things that are important: market, growth rate and margin.

kkowalczyk 14y ago
Corrections: 1. "Some guy" = Jason Calacanis. 2. "on Twitter" = http://blog.launch.co/blog/there-is-no-series-a-crunch.html http://blog.launch.co/blog/there-is-no-series-a-crunch.html

jspaur 14y ago

Suggested Title: Revenue alone won't get you VC

yurylifshits 14y ago

In my view, for Round A you need revenue and the following three: 100M$+ market volume Margins Distribution strategy Distribution strategy is better property to focus on than growth rate. All these week-over-week or month-over-month numbers can be gamed. And keep in mind "Crossing the Chasm" challenge. Your growth rate among early adopters has nothing to do with your ability to win the mainstream market.