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It is good to have you here 😊
Every two weeks, we share our SaaS Core Insights which covers very interesting and you should know stuff about building your next SaaS project, consumers behaviour and how it shapes coming trends, companies valuable financial information, successful SaaS companies for sale to acquire, companies growth and much more.
We will release our premium content in the coming week. Which includes more information and data points about:
✅ Direct connection to key people in successful companies ⭐️🌟
✅ More financial and SaaS metrics
✅ Profitable SaaS products aspire to create yours
✅ Latest successful gems and trends from IndieHackers, HackerNews, Google and Wordpress extensions.
There is always very interesting stuff happens within SaaS ecosystem worldwide, don’t forget to subscribe and stay in the loop.
Thank you for being a dear reader 😊🙏🏼
That being said let’s dig into our insights.
📊 Saas Metrics
How SaaS companies Calculate CAC ration ?!
Founders always have these great questions about concepts they struggle with, so I thought I’d cover one today. The question is about customer acquisition cost and how to calculate it.!
CAC is (Customer Acquisition Costs), refers to the total amount you spend to acquire a new customer – including all the sales and marketing expenses that you pay to get those customers. The CAC ratio is also referred to as the Cost of ARR (annual recurring revenue).
Why Is CAC Important?
The customer acquisition cost indicates how much time it will take to generate profits from each customer. CAC also helps measure the effectiveness of your marketing strategies.
What is a good CAC ratio for SaaS?
A good CAC ratio for your company depends on the customer lifetime value of your business.
How do you simply Calculate your CAC?
To calculate your CAC, divide the total sales and marketing expenses with the total number of customers acquired within a specific period.
For example, if your sales and marketing expenses for this month is $5,000 and you acquired 25 new customers, your CAC will be:
CAC
= 5,000/25 = $200 per customer
You can calculate the time required to recover CAC by dividing the CAC with the difference of monthly recurring revenue and the average cost of service.
For example, if your average monthly recurring revenue (MRR) per customer per month is $100 and the average cost of service (ACS) is $60, then the time required to recover CAC will be:
CAC payback period
= 200/(100-60) = 5 months
Remember, measurements are meant to be instruments, not absolutes. While there is not specific definition for CAC however you’ll calculate it differently depending on what question you’re trying to answer.
💼 Companies to acquire
The number of SaaS companies to be acquire are growing every month and the marketplace is getting bigger. Here are few companies caught our attentions.
ℹ️
TTM revenue = Trailing 12 Months OR Total revenue over the past 12 months
TTM profit = Total profit over the past 12 months
ARR = Annual Recurring Revenue
MRR = Monthly Revenue Revenue
1- Companies with annual revenue over $1M 💰💰💰
Profitable eCommerce brand selling ancient culture items
TTM revenue: $1,075,000
TTM profit: $222,000
Last month revenue: $10,000
Last month profit: $3,000
Customers: 10,000+ and 20,000 mailing list
Financial: Bootstrapped ✨
Asking price: $550 K
Profitable eCommerce brand solar-powered lanterns
TTM revenue: $1,000,000
TTM profit: $40,000
Last month revenue: $5,0000
Last month profit: $1,000
Customers: 200,000+
Financial: funded $1,000,000
Asking price: Open to offers
🌟 Profitable eCommerce B2B doing wholesale drop-shipping
TTM revenue: $1,350,000
TTM profit: $270,000
Last month revenue: $150,000
Last month profit: $70,000
Customers: 200,000+
Financial: No investors, no debt.
Asking price: $750 K
2- Companies with annual revenue under $1M 💰💰
🌟B2B/B2C SaaS in VPN, data encryptions and browsing anonymously
TTM revenue: $500,000
TTM profit: $250,000
Last month revenue: $41,666
Last month profit: $20,833
Customers: 250,000 weekly active users, 100,000+ daily users
Financial: Bootstrapped
Asking price: $5 M
Profitable SaaS in s a white-labeled online ordering system
TTM revenue: $700,000
TTM profit: $620,000
Last month revenue: $58,000
Last month profit: $50,000
Customers: 250,000 weekly active users, 100,000+ daily users
Financial: Raised $800,000 in funding
Asking price: Open to offers
Profitable SaaS helping our customers to rank on Google
TTM revenue: $400,000
TTM profit: $300,000
ARR: $600,000
Last month revenue: $62,000
Last month profit: $52,000
Customers: 300 current paid customers
Financial: Bootstrapped
Asking price: $2 M
3- Companies with annual revenue under $100K 💰
Profitable SaaS help twitter users audit their followers
Monthly Net Profit: $9,700
Monthly Expenses: $300
MRR: $10,000
Customers: 1,001-10,000
Asking price: Open to offers
How does your business make money?: Subscriptions
🌟 Profitable iPhone app does Countdown app
TTM revenue: $23,000
TTM profit: $17,000
Last month revenue: $6,000
Last month profit: $4,750
Customers: 80,000 active users
Financial: Bootstrapped
Asking price: $500 K
How does your business make money?: Subscriptions, $0.99 per month, $4.99 per year, $12.99 lifetime
Profitable marketplace for stock footage
TTM revenue: $24,199
TTM profit: $15,000
Last month revenue: $739
Last month profit: $239
Customers: 80,000 active users
Financial: Raised $300,000 in funding
Asking price: $175 K
How does your business make money?: Subscriptions 29$/month
📚 Good content to read
The Ancient Origins and History of Modern Marketing and Advertising
Indian eCommerce domain has seen new heights in 2020, What is the future in 2021?
How to increase retention?
What really happened at Basecamp It started with a list of “funny“ customer names, and by Friday a third of Basecamp employees quit.
Patreon CEO Posts YouTube apology for firing 36 people as valuation rises to $4 billion
Today, companies track and analyze their product data meticulously, with a proven book of formulas to guide their decision making. In Jacco Van Der Kooj’s The SaaS Sales Method, he explains why.
Stéphan Nasser’s review of his top 12 choices, which compares each based on 5 key criteria, should be the first stop of your Startup financial modeling journey
The three key characteristics of a SaaS company are: subscription, high margin, and scalability. Alex Oppenheimer show that we can learn a lot about its long term prospects as a business.
Your customers’ product experience is the core piece of their overall customer experience, but the two are far from the same. Chameleon created a great in-depth guide on this concept to get into the nuances.
💸 Where should I put my money
Here we focus on selected growing and profitable companies are looking for public funds.
LUPii Powering food with the #1 plant protein: the lupini bean
Problem: Plant-based is going mainstream but where is the whole-food, delicious, and truly sustainable plant protein?
Solution: LUPii: A better protein source for you and the planet
Product: Lupii is starting by bringing true innovation to the bar category.
Market: Plant-based is the new organic. Lupii is tackling a massive market opportunity and addressing the $34B global plant based-food market, which is growing at 11.9% CAGR through 2027.
Linen Democratizing wealth building with crypto and the ownership economy
Problem: Ownership economy is a new way of building engagement between brands, communities, and customers
Solution: Linen: build wealth with the ownership economy
Product: Full suite of tools for a novice to build wealth with the ownership economy: App, Wallet, Community
Market: They have exposure to the following markets:
Broad crypto assets. The market size of crypto assets is projected to grow to $3 trillion by 2025. We think this is a very conservative estimate because this number is already $950 billion as of January 2021.
DeFi. Asset value locked in DeFi smart contracts today is already $25 billion. It grew rapidly from $920 million within 12 months.
Oracle Health Remote heart monitor using advanced sensors and AI, implanted in 2 minutes
Problem: Heart Failure emergencies are a $21B problem
Solution: A Cardiac Monitor using remote tech and AI
Product: Billions of data points for a comprehensive long term cardiac monitoring solution
Market: $5B Total Addressable Market opportunity. Initially, Oracle Health will focus on the 1M of heart failure patients who are in immediate need of remote monitoring solutions. Eventually we hope to reach all 6M Americans who suffer from heart failure.
💸 Who get the money
SaaS companies around the globe have recently raised good amount of fund.
🇬🇧 Manual, a UK-based provider of men’s wellness products, raises $30M source
🇺🇸 Price.com, an S.F-based money savings platform used for comparison shopping, cashback &coupons raises $10M – source
🇦🇹 GoStudent, an Austria-based tutoring marketplace, raises €70M –source
🇭🇺 Craft Docs, a Hungary-based collaborative note-taking app, raises $8M - source
🇺🇸 Cameo, a Chicago-based startup that lets fans pay for personalized videos from celebrities, raises $100M - source
🇳🇱 Otrium, a Netherlands-based startup that helps clothing brands sell end-of-season items, raises $120M – source
🇨🇦 DapperLabs, a Vancouver-based maker of blockchain-based digital collectibles CryptoKitties and NBA Top ShotNFT, raises $305M – source
🇪🇸 Glovo, a Spain-based on-demand delivery company, raises €450M - source
🇮🇹 Everli, an Italy-based online grocery marketplace, raises $100M - source
🌍 MENA in depth
MEAN region is The Middle East and North Africa.
Why we focus on it?!
It is one of the hottest emerging market in the world. By 2034, 95% of the world population will be in emerging markets. In 2020, 80% of all smartphones were located in emerging markets as MENA. Not only that, but 89.8% of the world population under 30 years of age lives in these regions. What does it mean?! A huge pool of untapped talents.
And regards eCommerce, today 80% of young Arabs shop online, compared to 71% in 2019. Besides, 50% of those aged 18-24 in the #MENA region are shopping online after the pandemic. That result to e-Commerce sector reached a value of $22B by the end of 2020. And prediction for each year increases by 7.3%.
In addition to that, we launch our insights 😀 from the UAE. Which gave us a very good exposer to the market here 📈 and the whole region.🤝💸
🔎 So, let’s discover what is going on in the MENA region.
UAE Economy Performs 'Better Than Expected' Despite COVID-19
The Ministry of Economy and other government entities are working to double the economy over the next decade, to $816.8B from about $381.2B now. According to estimates from the Central Bank of the UAE (CBUAE) real GDP is expected to grow by 2.5% this year, with non-oil GDP to increase by 3.6%.
Dubai Launches Food Tech Valley
Sheikh Mohammed bin Rashid, Vice President and Ruler of Dubai, unveiled the forward-thinking Food Tech Valley on 1 May. He said the "city" would help further develop vertical farming and other advanced agriculture technologies and bolster the UAE's food security. The UAE's food trade exceeds $27.2B annually. The city will also be an economic zone, which is particularly significant considering that the size of the AgTech market is projected to grow from $13.5 billion to $22B over the next four years.
⭐️ UAE announces 100% foreign ownership of firms beginning June 1st
The UAE Ministry of Economy has announced the amended Commercial Companies Law will come into effect on June 1st, 2021, enabling foreign investors and entrepreneurs to establish and fully own onshore companies. With there being more than 3000 UAE-based startups and the country witnessing a total of 129 startup deals take place in 2020 which amounted to $579M in funding, the news will, amongst other things, provide entrepreneurs with greater flexibility on where to operate.
Egypt-based Homzmart closes $15 million Series A round
Homzmart, the Middle East’s leading furniture & home goods marketplace platform, successfully closed its US$15 million Series A financing - the largest round in this sector in the Middle East to date.
Fintech developer Securrency raises $30M, to expand in UAE
Dubai Securrency, which develops digital infrastructure for banks and other financial service providers, said on Monday it had raised $30 million it its latest funding round, valuing the company at around $110 million.
Snapchat’s Spotlight officially arrives in the MENA region
Snap has just officially launched its new entertainment platform Spotlight in markets across the Middle East and North Africa (MENA). Starting today, users in the region will be able to access Spotlight which can be seen by more than 75 million users. Spotlight can help empower the Snapchat community and express themselves and reach a large audience in a new way.
SaaS Core Insights is a biweekly newsletter, brings you top content SaaS space around the globe with a focus on MENA region.