Mostly metrics

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Feature Story

The following quarterly benchmarking report blends private company benchmarking + public company valuation context + operator relevant commentary.

It’s what I call ‘operator equity research’.

  • We’ve all been passed a deck from an investment bank at one point or another, and been like, oh this is so cool.

    • But, like, I’m not buying a company. I’m operating one…

  • And we’ve all been passed a VC portfolio company benchmarking report, and been like, oh this is so cool.

    • But like isn’t this only representative of the companies you’ve invested in?

That’s why we started doing this every quarter. I realized a base of nearly 70,000 readers, the majority of whom are the financial stewards of their company, could drive compelling and statistically relevant benchmarks.

And the good thing is we are going to do this every quarter.

Here were the most surprising insights from the latest report:

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  1. CAC Payback Remains Elevated
    Customer acquisition costs continue to stretch longer. AI disruption is pushing down traditional search channel effectiveness, and companies are increasingly building home‑grown internal tooling instead of buying (when practical).

  2. Growth Is Anchored in Existing Customers
    Net Dollar Retention is the real engine, especially past the $25M ARR scale. Expansion efficiency continues to be the primary growth lever, not fresh logos.

  3. Burn Multiples Continue to Decline
    With the macro backdrop still tight, capital discipline is improving. Even sub‑$25M ARR companies are showing better efficiency as burn multiples trend lower.

  4. The $5M–$25M ARR Stage Remains Challenging
    Dubbed “the messy middle”: CAC payback stays high, the Rule of 40 is weak, and operating leverage has not yet materialized at scale.

  5. Scale Unlocks Performance Gains (> $25M ARR)
    Once a company surpasses $25M in ARR, meaningful improvements emerge: in payback, burn, and retention. It’s a clear tipping point in operating efficiency.

  6. Revenue per Employee Is Accelerating
    Under $5M ARR, revenue per head hovers around $104K. By $50M+, operators are scaling toward ~$300K per employee, closing in on public SaaS benchmarks of $400K faster than expected.

  7. Shift Toward Sales vs. Marketing Spend Past $25M
    Marketing costs used to be ~33% of total S&M. Now it's closer to 25%, as sales teams shoulder more pipeline generation responsibility.

  8. Performance Dispersion Is Wide
    Top and bottom quartile comparisons of CAC, NDR, burn, and revenue/employee show stark divergence. High performers continue to pull ahead meaningfully.

This is what “operator equity research” looks like.

And I couldn’t do it without the operators who read this newsletter and contributed their data. You are truly real men and women of genius. It’s an honor to be in this benchmarking club with you.

If you want to see the full 33-slide report (yes, it’s really that long… my fingers hurt) packed with benchmarks by ARR cohort, ACV band, and company type—it’s now live for paid subscribers

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