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Because SaaS business models were built around operating at a loss in order to gain a monopoly and rent seek?
by faeriechangling 3y ago
Because SaaS business models were built around operating at a loss in order to gain a monopoly and rent seek?
- nathanaldensr 3y agoAnd also built in a time of free Fed money laundered through VCs.
- r_singh 3y agoLoss? Many (most? Except maybe asana) public SaaS companies have 20% cost of revenue AFAIK
- ksahin 3y agoYes loss. 70% of the SaaS companies that IPO'd in the past five years are loosing money. The median operating margin is -21%. Source: https://blossomstreetventures.medium.com/q1-saas-metrics-data-638dada1c413 https://blossomstreetventures.medium.com/q1-saas-metrics-dat...
- deleted 3y ago[deleted]
- ffhhttt 3y agoThat doesn’t include R&D & marketing costs which make them unprofitable overall. I guess they are betting that R&D costs are fixed(ish) or at least will grow slower than revenue. Which of course doesn’t always work, especially over the last few years where free money resulted in massive bloat.