SaaS Rule of 40 Drivers Using KeyBanc’s 2021 SaaS Survey
SaaStr
NOVEMBER 4, 2021
In simple terms, the “Rule of 40” states a healthy SaaS company’s a) revenue growth rate plus b) profit margin should exceed 40%. . In equation form, Revenue Growth % + Profit Margin % > 40%. The “Rule of 40” treats 1% of revenue growth as exactly equivalent to 1% of profit margin.
Let's personalize your content