KeyBanc Capital Markets & Sapphire Ventures 2025 SaaS Survey: AI-Driven Growth & Profitability Focus

The 16th annual KeyBanc-Sapphire Ventures SaaS survey reveals a market inflection toward profitable growth, with median ARR growth rebounding to 20% in 2025 and 25% in 2026, driven by AI adoption and sales efficiency improvements. Companies expect gross dollar retention to breach 90% by 2026, CAC payback to compress to 18 months, and Rule of 40 to improve from 6% (2024) to 27% (2026), signaling a healthier balance between growth and profitability. Nearly all survey respondents plan to increase AI spending in 2025, with 67% already monetizing AI through subscription or hybrid models, though most AI opportunities remain focused on product development rather than workforce reduction.