BOSTON, Nov. 18, 2021 /PRNewswire/ -- OpenView, a global venture capital firm that coined the term product-led growth (PLG), today released its fifth annual Financial & Operating Benchmarks Report (formerly known as Expansion SaaS Benchmarks). The report took a deeper look at successful SaaS companies ? including Shopify, Slack, Datadog, and Hubspot ? to compare performance across metrics that matter most in a SaaS business and identify those that propel long-term growth.
This year's report revealed surprising insights about the distribution and flows of capital within the public B2B SaaS landscape, what investors are rewarding in company performance, and the prevalence of product-led growth (PLG). According to the findings, the best-performing companies are driving outsized spending on R&D, which ties directly to PLG. In fact, PLG companies generate 1.7x more gross profit for every dollar of sales and product spent.
Other key findings from the report include:
"There are three simple traits we continuously see separate the "haves" from the "have nots" in the B2B SaaS landscape," said Sean Fanning, Vice President at OpenView. "It comes down to whether or not the company continues to execute against large and growing market opportunities, prioritizes business models built for rapid growth (i.e. product-led growth), and benchmarks well against economics that support high Free Cash Flow margins over the long term. Those that combine these three traits can set themselves apart and grow at exceptionally faster rates."
Some additional key takeaways from the report include how best-in-class companies are marrying the trio of "big market, compelling growth engine, and unit economics" to tell a big story; and how culture is critical to hiring in high-growth companies. The report also covers key SaaS value drivers, progress on executive diversity, and more.
"Today, investors are rewarding growth above all else," said Kyle Poyar, Partner at OpenView. "But growing fast is easier said than done, especially in the current hiring market. Best-in-class companies are doubling down on investments in product-led growth, usage-based pricing, and candidate experience to stand out from the crowd."
For more information, read up on the latest in OpenView's blog and download the Financial & Operating Benchmarks Report today:
Founded in 2006, OpenView is a venture capital firm investing globally in business software companies. With a mission to improve people's working lives, OpenView's focused investment approach across sector and stage enables the firm to identify and partner with category leading business software companies. The firm's focus extends to operational excellence through its dedicated expansion team working with portfolio companies on go-to-market, sales and marketing, product-led growth, talent, and corporate development. The firm is based in Boston and has $1.5 billion in total capital under management. For more information, please visit https://openviewpartners.com/.
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