Capchase publishes analysis of SaaS performance across sectors

The Capchase Team
The Capchase Team
Posted on
August 16, 2023
min read
Capchase publishes analysis of SaaS performance across sectors

The global economic slowdown has hit SaaS startups hard. With their customers looking for ways to reduce costs, many have experienced increased churn, longer sales cycles, and tougher price negotiations. But these effects have not been felt evenly across different sectors. 

To better understand in which sectors early-stage SaaS businesses have been the most resilient, and where the biggest opportunities lie for both founders and investors, we’ve just published the Pulse of SaaS IV: Navigating the New Normal

In it we analyze over 700 businesses and compare their performance before and after the downturn. For each sector we cover, we look at average performance in ARR growth, net margin, gross margin, rule of 40, logo and MRR retention, LTV/CAC, headcount, expenses/MRR, CAC/expenses, runway, and ARR/headcount.

We also share our expert analysts’ views on what’s driving these trends and provide real-life examples of how best-in-class businesses are mitigating the worst effects of the downturn.

The industries we cover are:

  • Consumer goods and services
  • Customer acquisition and engagement services
  • Corporate services
  • Financial services
  • Data and cloud solutions
  • Industrial solutions
  • Real estate and construction
  • Health and life sciences

Areas of opportunity: The sectors that hold the most promise for SaaS 

Despite the headlines of layoffs in the tech industry and falling valuations that have dominated the media over the last 18 months, our research shows that there are still sectors where growth is possible.  

Key insights from the report include:

  • Companies in the real estate sector have exhibited better-than-expected resilience post-downturn in terms of margins, R40, and runway, contrary to pessimistic expectations.
  • Businesses in the healthcare sector, which are normally seen as a safe play in a downturn, are being outperformed by other sectors.
  • Startups providing financial solutions remained laser-focused on growth by investing heavily in product development.
  • A large number of top performers across sectors have increased their headcount.

The sector-specific strategies that drive growth

To help SaaS founders and leaders better understand how to succeed in their respective sectors, we’ve included case studies from some of the best-performing businesses in our dataset. 

  • Strategies that proved to be successful for businesses in the consumer goods and customer engagement sectors include either increasing or maintaining sales and marketing budgets while reducing general and administrative spend and focusing on increasing ROI on customer acquisition spend.   
  • Leading corporate and financial service providers had success by focusing on retaining their most profitable customers, negotiating multi-year contracts, or providing more bespoke products to their largest clients. 
  • On the other hand, top performers in the data & cloud sector focused instead on improving their product, which resulted in higher customer and net dollar retention rates. 

We hope that you'll be able to use this report to craft a winning strategy tailored to the sector that you operate in. 

Download the full report here.