OpenView SaaS Benchmarks Report 2022

2022 SAAS BENCHMARKS REPORT
CURT TOWNSHEND KYLE POYAR
Senior Director, Growth Operating Partner
Sponsored by

TABLE OF CONTENTS
Introduction
Participant Overview
Executive Summary: The Raw Data
Cutting Burn Without Crashing And Burning
Go-To-Market, Efficiently
PLG: More Than Just Product
People: Your Best, But Most Expensive Asset
Additional Resources
3
5
8
17
24
32
40
51
2 Proprietary and Confidential ©2022 OpenView Advisors, LLC. All Rights Reserved

We’re excited to launch this report at time where founders and
operators need it most. OpenView’s 2022 SaaS Benchmarks
Report combines over 3,000 respondents’ results
aggregated across six years of surveying private SaaS businesses
on their finance and operating metrics.
Why now? When operators sat down to build 2022’s budgets in late
2021, growth was the key metric and so GTM and R&D teams
were given cash to drive growth into new product lines, new customer
profiles, and new paid-ad channels. Hiring was at an all-time high and
headcount approvals were relatively easy to come by.
We all know what they say about best laid plans.
This year’s report reveals some interesting facts about what the heck
has happened. More specifically, how has the macroeconomic
environment has permeated private SaaS companies? To avoid
burying the lead, nearly everyone is cutting spend—regardless
of how much cash is in the bank.
What’s most interesting though is, “What comes next?” Which
companies are set up for success? How can founders and operators
emulate the companies that have built optionality? And how can they
avoid whiplash in the macro environment that is sure to continue?
LET’S DIVE IN
INTRODUCTION: WHAT COMES NEXT?

A huge thank you to our
lead sponsor this year
And to all our partners
PARTNERS
And to all our partners

DISTRIBUTION BY ARR DISTRIBUTION BY GEOGRAPHY
WHO TOOK THE SURVEY THIS YEAR?
19%
34%
14%
13%
9%
11%
51%
27%
7%
8%
7%
6 Proprietary and Confidential ©2022 OpenView Advisors, LLC. All Rights Reserved Source: OpenView 2022 SaaS Benchmarks Survey
CANADA
EUROPE
US
APAC
OTHER
$2.5M–10M
<$1M
>$50M
$10–20M
$20–50M
$1–$2.5M

43%
21%
7%
6%
4%
19%
30%
39%
24%
6%
DISTRIBUTION BY ROLE DISTRIBUTION BY ICP (IDEAL CUSTOMER PROFILE)
WHO TOOK THE SURVEY THIS YEAR?
MIDMARKET
(101–1,000 EMPLOYEES)
ENTERPRISE
(>1,000 EMPLOYEES)
SMB
(20–100 EMPLOYEES)
VERY SMALL BUSINESS
(<20 EMPLOYEES)
CONSUMER
OTHER
COO/VP OF OPERATIONS
CRO/VP OF SALES
CFO/VP OF FINANCE
CEO
FOUNDER
CO-FOUNDER
CMO/VP OF MARKETING
Source: OpenView 2022 SaaS Benchmarks Survey

EXECUTIVE SUMMARY: THE RAW DATA

COMPANY BENCHMARK DEFINITIONS
S I Z E A N D G R O W T H
Employees Number of full-time equivalent employees at the end of Q2 2022.
Funding Amount of equity capital raised to date.
Annual Recurring Revenue (ARR) Company ARR scale at the end of Q2 2022.
YoY Growth Rate Change in ARR at the end of Q2 2022 vs. Q2 2021.
F I N A N C I A L
Sales & Marketing Spend Spending on Sales & Marketing, including headcount, as a % of ending ARR as of Q2 2022.
R&D Spend Spending on R&D, including headcount, as a % of ending ARR as of Q2 2022.
Gross Margins Subscription revenue less cost of goods sold divided by subscription revenue at the end of Q2 2022.
Monthly Burn Rate (in 000s) Net monthly operating cash burn rate at the end of Q2 2022 (total $ lost each month, negative values = profit).
S A A S V A L U E D R I V E R S
CAC Payback (months) Months of subscription gross margin to recover the fully loaded cost of acquiring a customer.
Gross Dollar Retention Annual gross dollar retention (after churn, exclusive of upsells & expansion) seen in cohorts.
Net Dollar Retention Annual net dollar retention (after churn, inclusive of upsells & expansion) seen in cohorts.
D I V E R S I T Y
Women In Leadership % of female representation among employees director-level and above.
Underrepresented Minorities In Leadership % of underrepresented minority representation among employees director-level and above.

HOW TO READ THESE SLIDES
<$1M $1-2.5M $2.5M-10M $10-20M $20-50M >$50M
Employees 13 (7-38) 29 (21-38) 63 (38-88) 113 (88-176) 226 (176-276) 876 (488-1000)
YoY Growth Rate 100% (46-286%) 79% (37-153%) 50% (30-115%) 72% (30-101%) 40% (30-52%) 30% (18-55%)
F I N A N C I A L
Sales & Marketing Spend 32% (21-58%) 25% (20-54%) 34% (25-46%) 33% (19-60%) 40% (33-63%) 34% (23-41%)
R&D Spend 50% (30-70%) 40% (21-66%) 38% (21-50%) 40% (25-55%) 32% (23-40%) 28% (17-43%)
Gross Margins 70% (29-80%) 77% (60-85%) 80% (67-85%) 80% (72-85%) 80% (74-84%) 78% (67-84%)
Monthly Burn Rate ($ in 000s) 50 (0-175) 175 (0-225) 175 (0-625) 625 (375-1250) 1500 (94-1750) 1750 (0-2000)
CAC Payback (months) 7 (4-12) 11 (4-13) 12 (5-18) 15 (9-19) 17 (13-24) 16 (12-20)
Gross Dollar Retention 97% (80-100%) 95% (90-99%) 90% (85-96%) 90% (85-98%) 90% (88-95%) 95% (89-97%)
Net Dollar Retention 100% (87-103%) 105% (100-120%) 105% (95-117%) 111% (105-125%) 110% (101-117%) 110% (101-126%)
D I V E R S I T Y
Women In Leadership 16% (0-23%) 32% (1-48%) 24% (12-44%) 33% (23-48%) 30% (20-34%) 36% (33-50%)
Underrepresented Minorities In Leadership 0% (0-13%) 0% (0-50%) 10% (0-21%) 11% (0-25%) 1% (0-10%) 10% (1-20%)
Rows represent common KPIs
across categories including
size and growth, financial, value
drivers, and diversity.

<$1M $1-2.5M $2.5M-10M $10-20M $20-50M >$50M
Employees 13 (7-38) 29 (21-38) 63 (38-88) 113 (88-176) 226 (176-276) 876 (488-1000)
YoY Growth Rate 100% (46-286%) 79% (37-153%) 50% (30-115%) 72% (30-101%) 40% (30-52%) 30% (18-55%)
F I N A N C I A L
R&D Spend 50% (30-70%) 40% (21-66%) 38% (21-50%) 40% (25-55%) 32% (23-40%) 28% (17-43%)
Gross Margins 70% (29-80%) 77% (60-85%) 80% (67-85%) 80% (72-85%) 80% (74-84%) 78% (67-84%)
D I V E R S I T Y
Columns represent distributions
of responses from companies
at varying levels of ARR,
from <$1M to >$50M.

<$1M $1-2.5M $2.5M-10M $10-20M $20-50M >$50M
Employees 13 (7-38) 29 (21-38) 63 (38-88) 113 (88-176) 226 (176-276) 876 (488-1000)
YoY Growth Rate 100% (46-286%) 79% (37-153%) 50% (30-115%) 72% (30-101%) 40% (30-52%) 30% (18-55%)
F I N A N C I A L
R&D Spend 50% (30-70%) 40% (21-66%) 38% (21-50%) 40% (25-55%) 32% (23-40%) 28% (17-43%)
Gross Margins 70% (29-80%) 77% (60-85%) 80% (67-85%) 80% (72-85%) 80% (74-84%) 78% (67-84%)
D I V E R S I T Y
Each cell represents the median
performance of a company, as well as
the range (bottom quartile – top quartile)
of each metric at each respective ARR scale.
50 (0-175)
34% (25-46%)
16 (12-20)

FINANCIAL & OPERATING METRICS BY ARR
Median (25th percentile – 75th percentile)
<$1M $1-2.5M $2.5M-10M $10-20M $20-50M >$50M
Employees 13 (7-38) 29 (21-38) 63 (38-88) 113 (88-176) 226 (176-276) 876 (488-1000)
YoY Growth Rate 100% (46-286%) 79% (37-153%) 50% (30-115%) 72% (30-101%) 40% (30-52%) 30% (18-55%)
F I N A N C I A L
R&D Spend 50% (30-70%) 40% (21-66%) 38% (21-50%) 40% (25-55%) 32% (23-40%) 28% (17-43%)
Gross Margins 70% (29-80%) 77% (60-85%) 80% (67-85%) 80% (72-85%) 80% (74-84%) 78% (67-84%)
D I V E R S I T Y

FINANCIAL & OPERATING METRICS BY ARR
(‘22 VS. ’21)
<$1M $1-2.5M $2.5M-10M $10-20M $20-50M >$50M
Employees 13 (-5) 29 (-9) 63 (-13) 113 (-38) 226 (75) 876 (525)
YoY Growth Rate 100% (0%) 79% (-11%) 50% (0%) 72% (22%) 40% (5%) 30% (0%)
F I N A N C I A L
Sales & Marketing Spend 32% (7%) 25% (-5%) 34% (2%) 33% (-1%) 40% (5%) 34% (-16%)
R&D Spend 50% (0%) 40% (0%) 38% (4%) 40% (1%) 32% (7%) 28% (-2%)
Gross Margins 70% (3%) 77% (2%) 80% (4%) 80% (5%) 80% (0%) 78% (-1%)
Monthly Burn Rate ($ in 000s) 50 (0) 175 (125) 175 (-200) 625 (250) 1500 (1125) 1750 (1725)
CAC Payback (months) 7 (-1) 11 (3) 12 (-3) 15 (0) 17 (-1) 16 (1)
Gross Dollar Retention 97% (-1%) 95% (-1%) 90% (-5%) 90% (6%) 90% (0%) 95% (10%)
Net Dollar Retention 100% (0%) 105% (5%) 105% (-1%) 111% (8%) 110% (5%) 110% (5%)
D I V E R S I T Y
Women In Leadership 16% (1%) 32% (7%) 24% (-1%) 33% (3%) 30% (0%) 36% (8%)
Underrepresented Minorities In Leadership 0% (0%) 0% (0%) 10% (10%) 11% (9%) 1% (-4%) 10% (1%)

FINANCIAL & OPERATING METRICS BY FUNDING STAGE
Median (25th percentile – 75th percentile)
Angel / Seed Series A Series B Series C Series D+
Employees 21 (13-38) 63 (38-88) 113 (63-176) 176 (176-626) 626 (226-907)
Funding $3M ($0.5-3M) $15M ($8-15M) $28M ($15-63M) $63M ($43-100M+) $100M+ ($100-100M+)
Annual Recurring Revenue (ARR) $2M ($0.5-$2M) $6M ($2-6M) $15M ($6-15M) $15M ($6-35M) $50M ($35-50M)
YoY Growth Rate 70% (40-100%) 100% (30-180%) 61% (30-150%) 35% (25-60%) 42% (23-59%)
F I N A N C I A L
Sales & Marketing Spend 31% (20-52%) 30% (20-46%) 45% (31-80%) 40% (39-50%) 32% (23-52%)
R&D Spend 40% (30-60%) 38% (25-50%) 40% (29-50%) 37% (29-46%) 28% (16-44%)
Gross Margins 80% (70-85%) 80% (73-85%) 76% (60-81%) 75% (62-88%) 78% (72-82%)
Monthly Burn Rate ($ in 000s) 50 (0-175) 375 (50-625) 625 (375-1250) 1750 (187.5-1875) 2000 (1250-2000)
CAC Payback (months) 9 (3-14) 14 (7-17) 18 (12-24) 15 (12-19) 17 (14-23)
Gross Dollar Retention 90% (80-96%) 93% (88-97%) 90% (81-97%) 90% (82-98%) 92% (88-95%)
Net Dollar Retention 101% (94-115%) 108% (100-120%) 110% (95-125%) 114% (96-136%) 110% (104-126%)
D I V E R S I T Y
Women In Leadership 20% (0-40%) 25% (11-30%) 20% (10-30%) 40% (3-45%) 30% (21-38%)
Underrepresented Minorities In Leadership 10% (0-25%) 8% (0-20%) 17% (0-30%) 7% (0-15%) 10% (0-10%)

TIPS FOR INTEGRATING BENCHMARKS
Benchmarks are the map,
not the route
Financial and operating benchmarks can be used as a map
to assess where you are relative to peers. While they provide
show you the landscape, they don’t tell you the exact route
you will need to take. Each company may take a different
route—and for good reason.
1 Consider shareholders’
risk / return expectations
Different investors have different tastes for risk and return;
Either know what your “dream investor” looks like so you can
optimize performance vs. benchmarks that align with their
“taste” OR determine the way you want to scale your business
and find investors that are aligned with that approach.
3
Dodge whiplash with focus
There will always be another hot new metric or goal post set
at 300% growth. Make sure you know the type of company
you're looking to build and stay focused on executing.
Come up for air to check the benchmarks annually or
quarterly, not daily.
2 Performance and valuation are
a multivariate equation
Growth is a function of investment in sales and product which
is a function of growth … and so on. A sound strategy will
involve a series of tradeoffs.
4

CUTTING BURN WITHOUT
CRASHING AND BURNING

HOW CUTTING BURN BECAME NECESSARY
Record low interest rates helped drive a long period of growing at all costs.
However, (1) rising inflation caused central banks to (2) increase interest rates. As this happens,
investors see (3) less value in long duration assets (like high growth SaaS). Ultimately this (4) reduces
the amount of capital available to early-stage SaaS businesses.
A brief oversimplification of the macroeconomic changes.
Grow at all
costs
Pre-2022
Cut at all
costs
For operators, this has led to whiplash from
“grow at all costs” to “cut at all costs.”
Inflation . Interest rates .
Valuation of longer .
duration assets .
Cash available to .
early-stage SaaS .
1 2 3 4
Rapid Macroeconomic Changes (January 2022 – September 2022)
Proprietary and Confidential ©2022 OpenView Advisors, LLC. All Rights Reserved
18
Today

The value of a software company’s
revenue has been highly correlated
with interest rates.
As the Fed has drastically
tightened monetary policy,
capital has flowed out of
technology ETFs leading to multiple
compression.
INTEREST RATES HAVE DRIVEN MULTIPLE COMPRESSION
0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
3.00%
3.50%
4.00%
--
1.0x
2.0x
3.0x
4.0x
5.0x
6.0x
7.0x
8.0x
Jul-16 Jan-17 Jul-17 Jan-18 Jul-18 Jan-19 Jul-19 Jan-20 Jul-20 Jan-21 Jul-21 Jan-22
EV/NTM Revenue/NTM Growth
US 10-Year Note Yield
EV/NTM Revenue/NTM Growth vs. 10-Year Treasury Note Yield (Last 6 Years)
3.43%
1.5x
Source: Company filings and Pitchbook as of 06/15/22.
1. Represents average EV/LTM Revenue multiples for public software companies.
Jul-16 Jan-17 Jul-17 Jan-18 Jul-18 Jan-19 Jul-19 Jan-20 Jul-20 Jan-21 Jul-21 Jan-22
8x
7x
6x
5x
4x
3x
2x
1x
4%
3.5%
3%
2.5%
2%
1.5%
1%
.5%
EV/NTM Revenue/NTM Growth
US 10-Year Note Yield

THE MOST RECENT SELL-OFF HAS BEEN SEVERE
46.2x
30.7x
16.5x
--
5.0x
10.0x
15.0x
20.0x
25.0x
30.0x
35.0x
40.0x
45.0x
50.0x
Jan-19 Apr-19 Jul-19 Oct-19 Jan-20 Apr-20 Jul-20 Oct-20 Jan-21 Apr-21 Jul-21 Oct-21 Jan-22 Apr-22
>40% Growth
SaaS Index
20-40% Growth
10-20% Growth
<10% Growth
Grow at all Costs
11.0x
8.1x
6.9x
Blip #1 Grow at all Costs Blip #2 Sell off
From 2019 to 2021, the average
public SaaS business experienced
significant multiple expansion.
Despite strong underlying
performances, software valuations
have compressed in Q1 and Q2
as a result of rising interest rates.
Source: Company filings and Pitchbook as of 06/15/22.
1. Represents average EV/LTM Revenue multiples for public software companies.
20
EV/LTM Revenue – All Software(1)
Jan-19 Apr-19 Jul-19 Oct-19 Jan-20 Apr-20 Jul-20 Oct-20 Jan-21 Apr-21 Jul-21 Oct-21 Jan-22 Apr-22
50x
45x
40x
35x
30x
25x
20x
15x
10x
.5x

PRIVATE SAAS COMPANIES HAVE RESPONDED,
MOST NOTABLY BY ADJUSTING HEADCOUNT
PROJECTED FTE GROWTH RATES
% of companies
The depth of change is most clearly viewed
through two surveys we ran this year. One specific
to talent in February and this most recent one
in July.
In February, the majority(!) of companies were
planning to grow headcount by more than 40%.
This has rapidly shifted as job postings
have been replaced with layoff
announcements.
Today, most companies are still planning for
moderate headcount growth, but nearly 20%
are maintaining or reducing their staff.
2022 expected change in headcount
Source: 2022 OpenView State of Talent Report & 2022 OpenView SaaS Benchmarks Report
21
Q1 2022 SURVEY Q3 2022 SURVEY
0%
44%
56%
Reducing HC or
Freezing HC
Growing FTEs
by 0-40%
Growing FTEs
by +40%
19%
64%
18%
Reducing HC or
Freezing HC
Growing FTEs
by 0-40%
Growing FTEs
by +40%

AND COMPANIES ARE CUTTING REGARDLESS OF THEIR
GROWTH RATES
CASH RUNWAY
26% 26%
20%
17%
26%
less than 6
months
7-12 months 13-18 months 19-24 months 25+ months
We expected that companies with less than
18 months of cash runway would be making
significant cuts.
The consensus has been 18
months is “okay,” but 25+
months is ideal.
However, we were surprised to see companies
with more than 25 months of cash in the bank cuts
as much as those with only six months.
Our take: optionality is the most
valuable thing a SaaS company
can have today.
If extra cash ends up not being required,
it’s easier to start spending than to stop.
Source: 2022 OpenView SaaS Benchmarks Report
Note: Average reduction only includes companies that selected “we have adjusted cash runway” (67% of respondents)
Average Reduction In Cash Burn From FY ‘22 Plan
By cash runway
22
Less than 6
months
7–12 months 13–18 months 9–24 months 25+ months

0%
50%
100%
150%
200%
250%
300%
0.8 1.8 2.8 3.8 4.8 5.8
Growth
Rate
CUTTING CASH BURN DOESN’T COME WITHOUT RISKS
Top Quartile (smoothed)
Median (smoothed)
+25% Burn Reduction
<25% Burn Reduction
GROWTH RATE AND ARR BY CASH BURN REDUCTION
Representative sample of responses
Reducing cash burn was required for most companies,
but it only relieved some pressure.
Most companies that reduced cash by more than
25% also perform poorly today when it comes to
growth. This makes sense. If burn isn’t contributing
to growth, it needs to be cut.
However, ultimately companies will need to get
back to growing. But they’ll need to do so with
less cash on hand.
Note: Median and top quartile growth are smoothed averages; dots represent a representative sample of respondents
ARR SCALE
23
Most companies cutting burn
by more than 25% have
below median growth rates
As cuts become commonplace,
founders and operators are in
a critical position to begin doing
more with less.
GROWTH
RATE
$0 $1M $2.5M $10M $25M $50M $100M
0%
50%
100%
150%
200%
250%
300%

32%
25%
34% 33%
40%
34%
--
10%
20%
30%
40%
50%
60%
70%
<$1M $1-2.5M $2.5-10M $10-20M $20-50M >$50M
Median '21 Median '22 Top Quartile '22
DESPITE CUTS, S&M SPEND HAS REMAINED
CONSISTENT BELOW $50M
SALES & MARKETING SPEND
(% of ARR)
Larger companies are
cutting S&M. Even 2022’s
top quartile (41%) is below
2021’s median (50%)
Despite recent budget cuts, the typical percentage
of ARR being spent on sales and marketing hasn’t
changed much since last year.
It’s likely that these numbers will come down across
the board in 2023 as startups begin to focus on
more efficient and reliable routes to market.
Note: Sales & Marketing spend figures are displayed as a percentage of ARR
25
The exception lies in larger
companies where the median
S&M spend has been reduced
from 50% to 34%.
$1–2.5M $2.5–10M $10–20M $20–50M >$50M
<$1M
20%
30%
40%
50%
60%
10%
70%

100%
79%
50%
72%
40%
30%
286%
153%
115%
101%
52% 55%
--
50%
100%
150%
200%
250%
300%
350%
<$1M $1-2.5M $2.5-10M $10-20M $20-50M >$50M
Median '22 Top Quartile '22 Top Quartile '21
EARLY-STAGE COMPANIES ARE PULLING BACK ON GROWTH
GROWTH RATE
By company ARR (annual)
Top quartile growth for $1-
2.5M companies has fallen
from 300% to 153%
Growth rates set record breaking highs in
2021—and for good reason. Companies with
top quartile growth were able to garner multiples
in excess of 100x.
As growth rates become less and less rewarded,
the gap between good growth and great growth
is shrinking.
Note: Sales & Marketing spend figures are displayed as a percentage of ARR
26
$1–2.5M $2.5–10M $10–20M $20–50M >$50M
<$1M
100%
150%
200%
250%
300%
50%
350%

GROSS DOLLAR RETENTION AT $2.5-10M ARR
By target customer
27
GROSS DOLLAR RETENTION IS DOWN FOR
COMPANIES UNDER $10M IN ARR
98%
95%
92%
95%
75%
87%
90%
95%
0%
20%
40%
60%
80%
100%
<20 Employees 20-100 Employees 100-1000 Employees 1000+ Employees
2021 2022
Target Customer Size
-23%
-8%
Note: Some companies are focused on multiple segments—in these cases we ask which is their “primary” segment focus
Early-stage companies in the $2.5-10M range are
seeing gross retention come down relative to 2021.
Chargebee’s churn insights:
1. Set Churn as a Company KPI: Businesses with a
shared company wide KPI for churn see
improvements vs. those with differing departmental
KPIs for retention
2. Personalization goes a long way: 72% of
consumers only want to engage with personalized
messaging – as you scale, find ways to create
personalized experiences
3. ID the customers you can save: 15-30% of churn
can be resolved in the moment of cancelation. For
small company sizes, test reactive discounting or help
materials during cancelation

Valuation Explained By “NTM Growth”
Historical R-Squares(1)
PUBLIC COMPANIES ARE BEING VALUED
ON RULE OF 40, NOT ON GROWTH
52%
57% 57%
55%
52% 51%
46% 45%
36%
27%
Sep-21 Oct-21 Nov-21 Dec-21 Jan-22 Feb-22 Mar-22 Apr-22 May-22 Jun-22
(48%)
21%
31%
32%
30%
33%
40% 39%
37%
40%
39%
Sep-21 Oct-21 Nov-21 Dec-21 Jan-22 Feb-22 Mar-22 Apr-22 May-22 Jun-22
+81%
Valuation Explained By “Rule of 40”
Historical R-Squares (2)
Source: Company filings and pitchbook as of 06/15/22.
Note: 1. R-Square of EV/NTM Revenue regressed against NTM Revenue Growth Rate.
2. R-Square of EV/NTM Revenue regressed against NTM “Rule of 40.”
28

RULE OF 40 IS BACK–BUT DOES GOOD EQUAL 40?
RULE OF 40 BY COMPANY ARR
Rule of 40 calculated as YoY ARR growth plus LTM (last 12 months) free cash flow margin or EBITDA margin.
For example, if you’re growing at 50% YoY and have a -15% free cash flow margin over the last 12 months,
your rule of 40 = [50% Growth] + [-15% free cash flow margin] = 35%.
Rule of 40 has always been a solid gut check
for the general balance of a company’s
growth and profitability. However, it’s become
increasingly important as a driver of how
businesses are valued.
For companies with ARR below $10M, Rule
of 40 can vary widely from quarter to quarter.
Achieving 40 each quarter is not required.
But, it is required to have a grasp on what
caused a drop or spike, and what can be
done to get to 40 long term.
22%
38% 40%
30%
25%
30%
80%
70%
58%
41% 42%
38%
-20%
0%
20%
40%
60%
80%
100%
less than $1M $1-2.5M $2.5M-10M $10-20M $20-50M greater than
$50M
Bottom Quartile Median Top Quartile
29
Less than $1M $1–2.5M $2.5–10M $10–20M $20–50M Greater than $50M
0%
20%
40%
60%
80%
-20%
100%

GO-TO-MARKET EFFICIENCY COMES DOWN TO BLENDING
CAC PAYBACK AND NDR
30
MEDIAN GROWTH RATE AND RULE OF 40
By NDR/CAC payback ranges
NDR
Growth: 200%
Ro40: 63%
High NDR, Low CAC
Growth:100%
Ro40: 54%
Growth: 42%
Ro40: 58%
Growth: 86%
Ro40: 30%
Growth: 38%
Ro40: 20%
Growth: 35%
Ro40: 0%
Low NDR, High CAC
Growth: 80%
Ro40: 1%
Growth: 58%
Ro40: 42%
Growth: 39%
Ro40: 53%
CAC
High
(+120%)
Mid
(120-105%)
Low
(<105%)
Low
(<7.5 Mo)
Mid
(7.5-15 Mo)
High
(15+ Mo)
CAC PAYBACK IMPROVES - GROWTH & RO40 DO TOO
The public markets have oscillated from valuing
growth rate alone to valuing rule of 40. For most
operators, this shift—combined with a decrease
valuations and cash available—has led to the
rapid decrease in spending.
However, companies that can achieve top quartile
NDR and CAC payback periods are immune from
this oscillation.
The data shows the operators focused on these
two metrics achieve the best of both worlds: the
highest median growth rate and highest median
Rule of 40.
How to read this:
If NDR falls in this range, and CAC
payback falls in that range, the median
growth and rule of 40s are in the box
Note: Growth and Rule of 40 values are medians for companies within the set NDR and CAC ranges.
NDR
IMPROVES
–
GROWTH
AND
RO40
DO
TOO

GREAT CAC PAYBACK & GREAT NDR WILL VARY BASED ON THE
CUSTOMERS YOU TARGET
31
CAC Payback By Target Customer – 50th Percentile & 80th Percentile
Target Customer Employees Good (50th) Great (80th)
VSMB / Prosumer <20 9 months 2 months
SMB 20-100 7 months 4 months
Midmarket 101-1,000 14 months 7 months
Enterprise 1000+ 14 months 9 months
NDR By Target Customer – 50th Percentile & 80th Percentile
Target Customer Employees Good (50th) Great (80th)
VSMB / Prosumer <20 100% 107%
SMB 20-100 100% 116%
Midmarket 101-1,000 110% 124%
Enterprise 1000+ 110% 125%
Compared with other metrics, CAC and NDR are
particularly sensitive to the type of customers you’re
targeting.
Smaller buyers like SMBs and prosumers tend to come
with lower sticker prices and less formal buying
processes. When combined, they can add up to a lower
CAC than you’ll find in the midmarket/enterprise.
The opposite is true with NDR, where opportunities for
growth within an account are much higher at larger
companies.
The takeaway: Make sure to cut your
own metrics by segment with differing
targets for NDR and CAC. Snowflake’s
+170% NDR is great, but if you’re selling
seats to SMBs, it’s an unrealistic target
to set.
Note: Some companies are focused on multiple segments—in these cases we ask which is their “primary” segment focus.

A NEW ERA OF FOR
PRODUCT-LED GROWTH
We studied the world’s top PLG
companies to find out what makes
them different
• PLG leaders are growing 50% year-
over-year, far faster than traditional
SaaS companies (21%).
• PLG leaders see best-in-class net retention
(128%) and have extremely efficient
growth engines (63% Rule of 40).
33

Build For The End User
1
Build To Be Discovered
2
Build To Meet Your
Users Where They Work
3
Build For Openness
4
Build For Flexibility
5
Build Community As Competitive Advantage 6
Deliver Instant Product Value 7
Deliver Instant Customer Experience 8
Monetize After You Deliver Value 9
Monetize Based On Usage 10
Monetize Beyond Software 11
THE 11
PRINCIPLES
OF PLG
IN THIS NEW ERA, WE SEE 11 CORE PRINCIPLES.
LEADERS HAVE ADOPTED 9+
Read more about each
principle here

SEVERAL OF THESE TACTICS HAVE BECOME TABLE STAKES
WHILE OTHERS CAN DIFFERENTIATE
11 PRINCIPLES OF PLG – TACTIC ADOPTION
Note: Percentages are rounded to the nearest hundredth.
11%
14%
18%
20%
21%
25%
30%
38%
44%
49%
61%
46%
38%
45%
58%
42%
45%
46%
46%
40%
27%
22%
43%
48%
37%
22%
37%
30%
24%
16%
16%
25%
18%
Built for the end user
Built for openness
Delivers instant value
Delivers instant customer experience
Built to meet users where they work
Built for flexibility
Built to be discovered
Monetized based on usage
Built community as a competitive advantage
Monetized after delivering value
Monetized beyond software
Not a focus Partially Invested Core to our GTM
35
Table stakes
Differentiators

13 Mo.
12 Mo.
9 Mo.
8 Mo.
Discoverable in Moment of Need Robust Free Product
Partial/Not a Focus Core
MEDIAN CAC PAYBACK
PLG tactic adoption
COMPANIES WITH DIFFERENTIATED PLG MOTIONS
OUTPERFORM PEERS ON CAC PAYBACK
Note: CAC payback periods represent the median CAC payback dependent
whether company see a PLG tactic as core vs. partial/not a focus.
36
PARTIAL/NOT A FOCUS
Companies that see discoverability and a robust free
product as core to their strategy return CAC costs four
months faster than their peers. The reasoning is intuitive:
Discoverability: Building your product to be easily
discovered helps keep marketing spend efficient
Robust Free Product: Providing a high value product
to new users helps improve conversion rates and expand
pricing at the time of conversion DISCOVERABLE IN MOMENT OF NEED ROBUST FREE PRODUCT
CORE
PLG doesn’t just align your GTM
with how your customers want to
buy, it also help align your GTM
with financial performance

When you’re building a company, the
first thing you need to do is figure out
where customers are hanging out.
It’s meeting them where they are at. Do they
go to industry events? Are there communities
where they hang out? You’ve got to identify
where those core customers are spending their
time and use this to inform your decisions.
Wade Foster • Co-founder & CEO
GTM TIP 1: MAKING YOUR
PRODUCT DISCOVERABLE
End users don’t search for tools–and Zapier isn’t discoverable there
Instead, they work to be discoverable where their end users are

 Offer a reverse trial: a 14-day trial of Pro,
then users default to the Free plan.
 Let users explore the full potential of the
product while keeping the door open to nurture
the relationship over time.
 After the trial expires, usage limits are
the most powerful paywalls (80/20 rule).
GTM TIP 2: PROVIDE A ROBUST FREE PRODUCT
WITH “REVERSE TRIALS”

GTM TIP 3:
DON’T SLEEP ON PRICING
Your product is changing, so should your pricing
61%
of companies adjusted their
pricing in the last year.
On average,
the expected/realized
ARR impact to is
+27%
As companies expand their product portfolio and/or begin to find new use
cases, they’re often too slow to adjust pricing with it. Nearly two-thirds of
companies changing their prices cite these reasons.
Challenge the model
Matching traditional seat-based pricing models can leave money on the table—
over 55% of respondents have at least tested usage-based pricing and seen
higher median NDRs.
Do your research
Nearly 20% of companies with less $50m in ARR do not conduct a dedicated pricing
project, and it shows. ARR impact was 7% higher when a project was completed. Get started on pricing here!
Convinced?

PEOPLE: YOUR BEST,
BUT MOST EXPENSIVE ASSET

PEOPLE AND THEIR REVENUE CONTRIBUTION
$12K
$47K
$60K
$87K
$114K
$143K
$20K
$66K
$100K
$111K
$145K
$200K
$36K
$85K
$119K
$145K
$181K
$375K
less than
$1M
$1-2.5M $2.5M-10M $10-20M $20-50M greater than
$50M
25th 50th
REVENUE PER EMPLOYEE BY ARR
25th, 50th, and 75th percentiles
SaaS seems to love complicated metrics.
We’d be lying if we said we didn’t love
a few of them too. However, an increasingly
important one is shockingly simple:
ARR per FTE.
Early on, this metric will be extremely low
($10-40K), but companies should be mindful
in their planning of what this number should
look like at scale. The general rule is to
get to or exceed $200K when you
reach scale.
13 29 63 113 226 876
ARR
MEDIAN
HEADCOUNT
41
75th

A TYPICAL COMPANY’S EMPLOYEE DISTRIBUTION
AVERAGE EMPLOYEE DISTRIBUTION
By Department by ARR
13 29 63 113 226 876
40%
34%
30%
32%
29% 25%
13%
18%
15%
18%
20%
22%
10%
7%
11%
15%
20%
23%
21%
20%
24%
0%
10%
20%
30%
40%
<$1M $1-2.5M $2.5-10M $10-20M $20-50M >$50M
Engineering
Other
Sales
CS
Product
Marketing
Engineering is consistently the
largest department, typically
representing 200+ employees at
$50M in ARR.
Other varies by organization..
Always include HR, Legal, and IT
but also organizations that can
be sizeable at specific orgs
(e.g. Growth or Services).
In prior years, we’ve seen Sales
outpace Engineering by +$50M,
however, with the rise of PLG,
businesses are less likely to
make this jump.
ARR
MEDIAN
HEADCOUNT
42
10%
20%
30%
0%
40%

ENGINEERING DISTRIBUTION
25%
20% 20%
24%
20% 20%
40%
36%
30%
33%
28%
20%
50%
40%
35%
40%
32%
28%
less than $1M $1-2.5M $2.5M-10M $10-20M $20-50M greater than $50M
25th 50th 75th
ENGINEERING EMPLOYEE REPRESENTATION
Keep in mind each company will have a different product and GTM strategy.
This may lead to good reasons to buck these trends.
43 Source: 2022 OpenView SaaS Benchmarks Report

5% 5%
6%
5% 5% 5%
10%
9%
10%
9%
7%
6%
20%
15%
13%
11%
10%
12%
25th 50th 75th
PRODUCT DISTRIBUTION
PRODUCT EMPLOYEE REPRESENTATION
44

5%
10% 10% 11%
13%
16%
10%
15% 15%
19%
20% 20%
20%
20% 20%
25% 25%
28%
25th 50th 75th
SALES DISTRIBUTION
SALES EMPLOYEE REPRESENTATION
45

EARLY ON WOMEN LEADERSHIP LAGS;
WOMEN'S REPRESENTATION CORRELATED TO HIGHER GROWTH
46
7%
48%
38%
50%
36%
77%
$50M
100%
65%
55%
27%
33%
20%
300%
99%
85%
75%
33%
27%
$50M
Growth rate with at least
one-third women
Growth rate with less than
one-third women
Note: Ideally, this data would be cut by 50% women in leadership, not 33%.
However, the sample size becomes too small for early-stage companies with that analysis.
Less than $1M $1–2.5M $2.5–10M $10–20M $20–50M Greater
than $50M
Less than $1M $1–2.5M $2.5–10M $10–20M $20–50M Greater
than $50M
MEDIAN GROWTH RATE
Based on women leader representation
% OF COMPANIES WITH AT LEAST
ONE-THIRD WOMEN LEADERSHIP TEAM
Less than one-third of leadership roles
are filled by women at most early-
stage businesses.

LEADERSHIP ROLES FOR WOMEN ARE DOMAIN-SPECIFIC:
PRIMARILY HR AND MARKETING
% Women Representation
By Leadership role type
19%
50%
46%
62%
60%
58%
13%
23% 22%
27%
19%
34%
6%
13%
10%
13% 14%
18%
Marketing / HR Leader Other Internal Leadership Roles (e.g. Sales) Board of Directors
47
Less than $1M $1–2.5M $2.5–10M $10–20M
$20–50M Greater than
$50M
MARKETING/HR LEADER OTHER INTERNAL LEADERSHIP ROLES (E.G. SALES) BOARD OF DIRECTORS

ABOUT THE AUTHORS
CURT TOWNSHEND
KYLE POYAR
49
SENIOR DIRECTOR, GROWTH
OPERATING PARTNER
Curt supports OpenView’s Growth Team, helping portfolio companies accelerate top-
line growth and dominate their markets. He works closely with portfolio leadership
teams to discover, test, and implement the most impactful strategies for growth.
Kyle leads OpenView’s Growth Team, responsible for advising portfolio executive
teams on strategies to increase revenue growth and dominate their markets. The team
has helped the portfolio generate over $100 million in additional enterprise value in
the last three years.
Kyle specializes in pricing & packaging strategy, which is the most effective yet
overlooked growth lever at a SaaS company’s disposal. He’s an expert in product-led
Growth, optimizing go-to-market strategies, and SaaS benchmarks.
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Our mission is to improve
people’s working lives.
THE EXPANSION STAGE SOFTWARE VC
• Investing in the best software companies
• Helping our portfolio companies accelerate growth and
become market leaders
WE DO THIS BY
Some of the companies mentioned in this are OpenView
portfolio companies. For additional information about our
portfolio companies, please visit openviewpartners.com/portfolio/

HOW CAN YOU DIG DEEPER?
The 2021 SaaS Financial & Operating
Benchmarks Report
Kyle Poyar’s Growth Unhinged
Pricing In-a-Box: Your Pricing Project
Starts Here
A New Era for PLG: Introducing
the Age of Connected Work
Your Guide to a PLG Series A
The New User Journey: Follow Your
Users to Understand How to Excel at
Go-To-Market
51

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