Tomasz Tunguz (Theory Ventures) · 2022-10-30 · 1313d

Sales Efficiency Trends in SaaS During COVID-19: Analysis and Strategic Implications

This analysis examines how COVID-19 impacted sales efficiency metrics for public SaaS companies, revealing an initial improvement followed by a sharp decline. The author argues that increasing competition has raised customer acquisition costs, and that breakthrough sales channels are needed to restore efficiency levels. Companies demonstrating superior sales efficiency are commanding premium valuations, while those facing declining efficiency must innovate to remain competitive.

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Metrics in this report

Customer Acquisition Cost Growth

65%

5-year increase

SaaS companies prior to 2017

Figma Acquisition Multiple

50x ARR

valuation multiple

Adobe acquisition of product-led growth company

Sales Efficiency

52 to 47%

average

public software companies 2016-2022

Sales Efficiency Improvement

3percentage points

median

public software companies during back half of COVID

Sales Efficiency to Valuation Correlation

55%

correlation coefficient

SaaS company multiples