2023 Private SaaS Company Valuations

Public market valuations reflect real-time information and have high data integrity because they include many different companies and are based on audited financial statements. Public valuation data is the primary starting point for valuation analysis by both buyers and sellers.

We developed the SaaS Capital Index™ (SCI) to represent what we feel is the best profile of a B2B SaaS company. The revenue multiple is based on annualized current run-rate revenue, not trailing or projected revenue. We believe run-rate revenue is the most accurate and objective measure of the current scale of the business and, therefore, the best measure to be used for valuation purposes. The index excludes SaaS companies serving B2C customers and very small B2B companies with annual revenue per customer of less than $500. Companies targeting these end users have customer acquisition and retention dynamics that are significantly different than those of traditional B2B SaaS businesses. The SCI is updated monthly and free to download here. As of March 31, the SCI shows a median public valuation multiple of 7.1.

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