cloudedjudgement.substack.com · 2020-07-14 · 2151d

BigCommerce S-1 Benchmarking: Pre-IPO Financial Analysis vs. Public SaaS Peers

This article analyzes BigCommerce's S-1 filing ahead of its anticipated IPO, benchmarking key financial metrics against public SaaS companies to assess valuation. The author identifies BigCommerce as a lower-growth, lower-margin player relative to peers, predicting an IPO valuation of $1.5-2B at approximately 10x forward revenue. Key concerns highlighted include negative GAAP operating margins (-32%), below-median revenue growth (24%), and weak Rule of 40 score, though the company benefits from COVID-driven eCommerce tailwinds.

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Metrics in this report

Forward Revenue Multiple

14multiple

median

Medium-growth SaaS businesses; Wix.com trading at upper bound

Forward Revenue Multiple

10multiple

predicted for BigCommerce

Analyst prediction based on discount to peer median due to lower margins and unit economics

GAAP Operating Margin

-32percent

BigCommerce

Public SaaS companies; BigCommerce negative 32% vs. median ~15%

Gross Margin

75percent

BigCommerce subscription revenue

BigCommerce revenue composition

LTM Revenue

68million dollars

BigCommerce

Below typical $100M IPO threshold; on lower end of public SaaS peer set

LTM Revenue Growth

24percent

BigCommerce

Public SaaS companies; BigCommerce 24% vs. median ~40%

Net Revenue Retention

108percent

BigCommerce customers >$2k ACV

Represents 80% of BigCommerce revenue; overstates overall NRR when excluding <$2k cohort

Rule of 40 Score

8percent

BigCommerce

Growth (24%) + Operating Margin (-32%) = -8; well below healthy 40+ threshold