Vous êtes sur la page 1sur 11

SaaS Revenue Primer

Flux Analysis
January 2009

DevelopmentCorporate
www.developmentcorporate.com

DevelopmentCorporate
Overview & Contents

The traditional approaches to technology revenue


analysis are different for SaaS solutions. This
presentation covers one of several techniques that
executives and investors should use to assess the
relative health of SaaS revenues
Contents

SaaS Revenue Primer

SaaS Revenue Flux Analysis

Other SaaS Revenue Analysis Topics

DevelopmentCorporate
Copyright 2009 Development Corporate www.developmentcorporate.com
SaaS Revenue Primer

Fundamentally different than traditional
licensed software / maintenance /
professional services economic model

Techniques for forecasting, analyzing,
and assessing SaaS product line
performance are different

New analytical approaches are needed
to get underneath the SaaS iceberg

This is first of a multi-part presentation
on SaaS Revenue Analysis

DevelopmentCorporate
Copyright 2009 Development Corporate www.developmentcorporate.com
SaaS Revenue Components


License, maintenance, and PSO fees replaced with:

User fees – monthly $ / per user or seat

Usage fees – cost per transaction / activity (often sold in bundles)

Setup/ Customization fees (generally one time)

‘Junk’ fees (archiving, private labeling, special connectivity, etc.)

Take Away: Understand the Components and Structure of SaaS Revenue Stream
DevelopmentCorporate
Copyright 2009 Development Corporate www.developmentcorporate.com
Flux Analysis


Typical SaaS monthly revenue analysis

Top 10 customers showing strong growth (50%+ YoY)

Rest of customers driving 20% of total growth

Total SaaS Service Line growing 8%+

On the surface, all looks good

DevelopmentCorporate
Copyright 2009 Development Corporate www.developmentcorporate.com
Flux Analysis

Understanding changes in SaaS revenue streams is critical

Always compare to another period (last month, last year, etc.)

Flux ‘categories’ are key:



How many new customers & how much revenue did they contribute?

How many customers quit/attritted & how much revenue did they contribute?

How many existing customers grew revenue & how much revenue did they contribute?

How many existing customers had flat revenues

How many customers had declining revenues & how much revenue did they contribute?
DevelopmentCorporate
Copyright 2009 Development Corporate www.developmentcorporate.com
Flux Analysis Example

DevelopmentCorporate
Copyright 2009 Development Corporate www.developmentcorporate.com
Flux Analysis Interpretation


Two major components:

Top 10 analysis

Flux category analysis

Provides real insight into SaaS
product line behavior

In this example, you can see:


The two top 10 new customers (#1 & #2) were responsible for the majority of
the month’s revenue growth

Customer #3 and #10 has huge growth – what was responsible for it?

Why did Customer #8 attrit? And what is going on with #7

Customers who grew revenue year over year and new customers drove the
year over year change and covered the attritions and revenue declines

The customer count change showed that a net 483 left the business – is this
a key trend for the future?
DevelopmentCorporate
Copyright 2009 Development Corporate www.developmentcorporate.com
How Do You Implement Flux Analysis?


Simple Excel-based analysis

Extract data from current systems

Assemble base data

Customer identifier, customer name, SaaS product name, period #1
revenues, period #2 revenues

Calculate period over period changes

Classify into flux categories: new, attritted, existing growth, existing
flat, existing decline

Use pivot tables to summarize tables and generate charts
DevelopmentCorporate
Copyright 2009 Development Corporate www.developmentcorporate.com
Other SaaS Revenue Analysis Topics

Here are some other topics that will be covered in this series:

Customer Tiering Analysis

How to segment/profile SaaS customers into significant tiers

Pricing Analysis

Not all customers pay the same price. What customers are paying
what rates and how does it relate to their tier / flux behavior

MoneyWheel Analysis

What are the repeatable sales transactions exist in your current
as well as prospective customer base?

DevelopmentCorporate
Copyright 2009 Development Corporate www.developmentcorporate.com
DevelopmentCorporate
DevelopmentCorporate is a strategic corporate
development advisory firm for enterprise and mid-
market technology companies. We assist
management teams, board of directors, and investors
in updating their merger, acquisition, and divestiture
strategies and then we provide tactical support for the
implementation of those strategies. We also provide
support for strategic initiatives such market
assessments, competitive intelligence updates,
product/service portfolio analysis, etc. Finally, we
have significant experience in guiding large scale
organizations through corporate restructurings to
either take advantage of new market opportunities or
respond to changes in market conditions.

www.developmentcorporate.com

DevelopmentCorporate
Copyright 2009 Development Corporate www.developmentcorporate.com