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New Data Gives Entrepreneurs Tools to Reap Higher Valuations

October 11, 2016, 07:28 AM
Filed Under: Software

SaaS Capital, a leading provider of committed credit facilities to SaaS companies, has released new data on the opaque, confusing, and highly volatile practice of valuing a private SaaS business.

The proprietary research, recently featured on TechCrunch, provides entrepreneurs and the management teams of SaaS businesses with a framework to objectively negotiate the best price for their company.

"Every day we talk to SaaS companies interested in growing their businesses through a capital raise or the sale of a company, but we often hear frustration on how to value the company," said Todd Gardner, Founder and Managing Director of SaaS Capital. "We published this framework to demystify the process VCs and acquiring companies use when valuing SaaS companies."

Click here to access How to Value a SaaS Company

Drawing from experiences selling and financing hundreds of companies, proprietary research of over 1,000 private SaaS Companies, as well as public market data; SaaS Capital put together a list of value drivers every SaaS management team should pay attention to as they go about preparing for an equity raise or sale of their company.

"Our research shows that a 1% improvement in customer retention will increase a company's value by 12%," said Rob Belcher, Managing Director of SaaS Capital. "By better understanding the mechanics of valuing a SaaS business, management will be better able to maximize the value of their company. The framework described in this research is designed to be adaptable to the public stock market environment well into the future."

SaaS Capital is a leading provider of long-term committed credit facilities to SaaS companies. Focusing exclusively on the SaaS business model, SaaS Capital delivers faster decisions, more capital, and longer commitments. SaaS businesses have used SaaS Capital's Committed Credit Facilities, instead of equity, to finance growth and create hundreds of millions of dollars in enterprise value without sacrificing significant ownership or control. Also, through its partnership with DH Capital, a boutique investment banking advisory firm, SaaS Capital can assist with M&A and capital raising services. SaaS Capital has offices in Cincinnati, New York, and Seattle.

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