SaaS Valuation Multiples
topic on 2 shows · 5 statements across 4 episodes
the Official SaaStr Podcast 
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5 statements about SaaS Valuation Multiples, every show
Lemkin: SaaS Multiples Will Not Return to 20x to 40x ARR
“We are not going back to 20 X, 40 X error. In fact, they're a little bit worse than they were four or five or six months ago.”
Donovan: Rule of 40 had zero correlation with SaaS multiples before Q2 2022
“So if you just use rule of 40 where you composite, you smoosh growth and efficiency together, until Q two of last year, there was actually no correlation. So, like, I would have called total BS on using rule of 40 by itself before Q two of last year. It just w…”
Donovan: R&D spending variation no longer predicts SaaS valuation multiples
“Interestingly enough, R&D, which the more you spent on R&D before, the stronger your multiple was, because you were investing for growth, now it's neutral. That very, like, there is no predictive, very, The variation in R&D spend does not have any predictive v…”
Pepper: SaaS Multiples Will Settle Higher Than May 2022 Levels Within 24 Months
“I happen to be one of the bulls and I'm not calling the bottom. That's not our job to pick the bottom, but my guess is that we do settle out at multiples higher than today over the next. 24 months. And we get back to that being normal as opposed to normal bein…”
Volset: Private equity caps SaaS multiples at 10x; higher requires strategics
“If you're growing zero to 20%, then like what is an easy multiple to get, I think is about three X. And then and from 20 up to about 50%, you can probably get four X, maybe five. From 50 to about a hundred percent growth. This is annual growth. You can get any…”