As the former executive vice president and CFO of Oracle, Jeff Epstein has guided software companies through all stages of growth. He’s now an operating partner at Bessemer Venture Partners, one of the largest and oldest venture capital firms in the United States. Jeff recently presented at the Sage Intacct SaaS Finance Summit, where he outlined what investors look for in each stage of investment for businesses seeking to grow through outside capital.
Investors expect you to prove various aspects of your business model at each stage of growth to secure your next round of funding. Here we focus on the early and growth stages.
During the early stage, you must prove your revenue model—which, according to Jeff, means 75% of your salespeople are hitting their quotas, and your growth is greater than 100%.
When you reach the growth stage, you must prove your net renewal model, which means you can demonstrate customer retention and the ability to sell additional offerings. This is where it’s vital to have the proper financial tools—and a small business accounting application doesn’t fit the bill.
Sage Intacct, a cloud-native financial management solution, is uniquely suited to support your SaaS company on the path to your next round of funding.
These five steps with Sage Intacct will achieve your growth-stage goals.
Integrate CPQ With Financials
SaaS companies often use Salesforce configure, price, quote (CPQ) software to manage complex sales, improve workflow and collaboration with finance, and standardize contracts. Integrating your customer relationship management (CRM) and CPQ processes with your financials means less repetitive data entry and more data for analysis, reporting, and improved decision-making. Sage Intacct easily integrates with Salesforce to help you remove friction points from the sales process and see a single version of the truth.
Establish Flexible, Contract-Based Billing
As you grow, you may expand your offerings to retain existing customers, attract new customers, and increase your average sales price. The ability to handle multiple revenue streams and billing means more flexibility to innovate, differentiate, and maximize customer lifetime value (CLTV). Rather than a hodgepodge of billing systems that can confuse customers, you can rely on Sage Intacct to support a blend of models across subscription pricing, usage billing, professional services, and perpetual licensing.
Build End-to-End Revenue Management
More revenues equal a higher probability of financial audits. That means your financials must comply with GAAP, ASC 606, and IFRS 15. Order-based solutions make it difficult to get a single view of your revenue recognition across unbilled, billed, and paid because the data lives in multiple places. But with Sage Intacct, compliance is automated. By automating revenue recognition and expense amortization, you save hundreds of hours and reduce errors. You also get complete visibility into unbilled, billed, and paid revenues and a full understanding of deferred revenue to guide your valuation.
Create Real-Time GAAP and SaaS Dashboards
GAAP metrics tell you where your business has been and where it is now, while SaaS metrics tell you where the business is headed. With Sage Intacct, you can automatically connect your contractual obligations to billing, revenue management, and your general ledger to automate the creation of GAAP and SaaS metrics. This on-demand visibility enables you to make immediate, strategic decisions to grow your business.
Forecast the Future
Forecasting doesn’t just help with hiring and product investment decisions—it’s required for business loans and investor funding. With integrated CRM, CPQ, and financials, you can automatically generate forecasts. You get one view of your customers (vs. disparate orders) across billing, revenue recognition, and cash. You pivot from manually reporting the past in time-consuming spreadsheets to real-time forecasts. And you free up time to strategically guide the business into the future.
Learn More
Sage Intacct is proven and validated by its customers across these five steps, which is why it’s number one in customer satisfaction in accounting and ERP and #1 in subscription revenue management on G2 Crowd.
To learn more, download the free eBook below, which includes links to read stories about SaaS companies like yours, watch Sage Intacct in action, and attend a coffee break demo.
