- Some Thoughts On Burn Rates
Fred creates an interesting rule of thumb to calculate how much to burn: 1. Calculate how much your company valuation will go up by in the next year (which will be mostly driven by revenue growth) 2. Divide that number by 5
- From $0 to $1M: Early Stage Burn Rates
Dale provides data aggregated from the portfolio at Scale Venture Partners, across two categories: • Operating Margin % by percentile, at $0-$1m in revenue • Operating Margin % by revenue bucket, from $0m to $50m
- Introducing the Lightspeed SaaS Operating Model
Natalie provides a template with a step-by-step guide. The model includes components for AE Rep Productivity, Inside Sales Productivity, ACV, Accounts, ARR, Sales Expense, SaaS Metrics, and a Summary P&L.
- Tweetstorm: Fixable Mistakes in Financial Models
Leo provides tips based on the models he's seen across seed and Series A companies, covering topics such as breaking out assumptions, jumpiness, having clear hypotheses, budgeting tips, and more. The replies also capture a number of great tips based on experience.
- Financial planning for SaaS startups
Christoph provides a "simple" template example he made for Zendesk, and links to a "V2" he made a year later that is more advanced. The template model separates signups into trackable and non-trackable sources, and calculates revenue by converting signups to customers and multiplying customers by average revenue. It accounts for costs like marketing, support, and development. Profit and cash flow are estimated simply at first. Notably, sanity checks are included to flag unrealistic projections like an EBIT margin over 90% or too few customers per support agent, helping catch planning mistakes.