cloudedjudgement.substack.com · 2021-09-01 · 1737d

Freshworks: Benchmarking the S-1 Data

This article analyzes Freshworks' S-1 filing by benchmarking key financial metrics against publicly traded SaaS companies, revealing Freshworks' $308M LTM revenue, 49% growth rate, 79% gross margin, 118% net dollar retention, and 24-month CAC payback period. The analysis contextualizes Freshworks' operating performance within the broader SaaS industry landscape and applies the Rule of 40 framework to assess overall health. The article demonstrates how pre-IPO SaaS companies should be evaluated relative to public comps across growth, profitability, unit economics, and retention metrics.

15 metrics· Cited 0× in the knowledge base ·Open source ↗

Metrics in this report

CAC Payback Period

24months

average

Freshworks, calculated from 4 quarters pre-IPO

CAC Payback Period (Gross Margin Adjusted)

24months

Freshworks using average of 4 quarters preceding IPO

Gross Margin

79percent

average

Freshworks LTM

Gross Margin (GAAP)

79percent

Freshworks LTM; consistent across trailing four quarters

LTM Revenue

308millions USD

Freshworks at S-1 filing; positioned near 50th percentile among public SaaS companies

Net Dollar Retention Rate

118percent

Freshworks, year-over-year cohort comparison

Net Dollar Retention Rate

118percent

Freshworks; indicates expansion revenue exceeding churn within cohort

Revenue (LTM)

308millions USD

Freshworks, pre-IPO SaaS

Revenue Growth Rate (YoY)

49percent

average

Freshworks LTM

Revenue Growth Rate (YoY)

49percent

Freshworks LTM growth with recent quarterly acceleration

S&M Expense as % of Revenue

53percent

Freshworks LTM; slight increase over trailing four quarters

Sales & Marketing Expense Ratio

53percent of revenue

average

Freshworks LTM

Total Addressable Market

120billions USD

Freshworks IDC-based TAM estimate, CRM + SSM

Total Addressable Market (Freshworks Internal Estimate)

77billions USD

Freshworks internal calculation based on company count and weighted average ARR by segment

Total Addressable Market (IDC Industry Research)

120billions USD

Freshworks addressable markets in CRM and System/Service Management