      SaaStr · 2012-10-11
      · 4983d
    

SaaS Growth Benchmarks: Why 90% YoY Growth at $250M ARR Should Reset Your Expectations

Jason Lemkin argues that SaaS founders using 'law of large numbers' to justify sub-100% growth rates are making excuses. Using Workday's $250M ARR at 90% growth as a benchmark, he contends that companies should maintain 100-150% YoY growth until reaching $100M ARR, or risk being classified as small businesses rather than true startups.

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

Metrics in this report

Acceptable Growth Rate for Scale

33%

industry observation

$40M ARR company, considered insufficient by author

Minimum Expected Growth Rate

100-150%

minimum range

for SaaS companies below $100M ARR

Workday Annual Recurring Revenue

250$M

current year

public SaaS company at time of article

Workday IPO Valuation Multiple

17-20x revenue

range

IPO year valuation

Workday Year-over-Year Growth Rate

90%

current year

public SaaS company at time of article