“A top four tile company since 2018 was over four hundred million of ARR, growing at almost 60%, worth about seven and a half billion dollars, and as you can see, had very strong metrics, and still took about 10 years for them to get there.”
quote is from the automated transcript, cleaned for reading:
filler sounds and stutters are removed, nothing is rephrased. names can be misheard
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More from Alex Clayton
PredictionOpen · timeframe Feb 2028
Clayton: Annual SaaS IPO capacity is capped at 20 companies
“And only 20 SaaS companies per year can actually make it public. We don't think this number is going to go higher than this anytime soon.”
Alex ClaytonFeb 21, 2025▶ 20:21The Real Data on What it Takes to Go Big and Eventually IPO with Meritech Capital
Insight
Clayton: Modern SaaS IPOs demand $400M ARR and 30% growth
“We think that you need to be at least four hundred million of ARR. You have to be growing at least 30% a year. You're probably going to be worth three to five billion dollars and trade anywhere from that eight to 12 X range.”
Alex ClaytonFeb 21, 2025▶ 10:09The Real Data on What it Takes to Go Big and Eventually IPO with Meritech Capital
“And regardless of private market valuation, at least in today's interest rate environment, companies cannot expect to be worth more than 10 times ARR.”
Alex ClaytonFeb 21, 2025▶ 21:03The Real Data on What it Takes to Go Big and Eventually IPO with Meritech Capital
Insight
Clayton: Down-round IPOs do not matter long-term with durable growth
“And the down round IPO is actually irrelevant over the long term. You've seen companies like SPS Commerce that are up almost 20 X from when they went public because they grew durably over time.”
Alex ClaytonFeb 21, 2025▶ 21:13The Real Data on What it Takes to Go Big and Eventually IPO with Meritech Capital
AssertionPartly supported
Clayton: Public SaaS companies beat and raise guidance 80% of the time
“Irrespective of all market conditions, 80% of the time, SaaS companies are beat, are beating current quarter guidance and raising the subsequent quarter guidance.”
Alex ClaytonFeb 21, 2025▶ 18:23The Real Data on What it Takes to Go Big and Eventually IPO with Meritech Capital
AssertionSupported
Clayton: CrowdStrike sustained nearly 50% ARR CAGR post-IPO to $4B
“They've continued on a very high growth rate through 20 24 and have been growing at a 50%, almost a 50% ARR growth CAGR since going public in 2019, and they're approaching four billion dollars.”
Alex ClaytonFeb 21, 2025▶ 15:45The Real Data on What it Takes to Go Big and Eventually IPO with Meritech Capital
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