onlycfo.io · 2023-09-14
· 994d
Death From Benchmarking
Benchmarking data, when misused by inexperienced practitioners, drives poor strategic and operational decisions through averages of dissimilar companies, isolated metric analysis, and inconsistent expense categorization. The article emphasizes that effective benchmarking requires understanding company comparability, holistic context analysis, and proper financial accounting to avoid costly mistakes in hiring, spending, and organizational design.
Metrics in this report
Free Cash Flow Margin
30%percent
best-in-class
Best-in-class software companies at scale
Gross Margin (COGS % of Revenue)
33%percent
median
Early-stage SaaS companies
Gross Margin (COGS % of Revenue)
17%percent
median
Post-IPO SaaS companies
Gross Margin (COGS % of Revenue)
25%percent
median
Public software companies (median)
OpEx as % of Revenue
427%percent
median
Early-stage SaaS companies
OpEx as % of Revenue
76%percent
median
Post-IPO SaaS companies