|
There’s a SaaS company at $1 Billion in ARR that’s seeing absolutely no downturn at all
Who’s that?
Blackbaud
They’ve been around forever, and the key is they sell fundraising software to nonprofits and schools
“We’re not seeing any downturn at all”
5 Interesting Learnings:
#1. A very slow, inorganic path to $1B — 9% CAGR.
Blackbaud is in some ways a case study of the perils of vertical SaaS. If you don’t expand your TAM enough, growth can stall at scale. Essentially all growth now is inorganic, i.e. from acquiring other products and companies. Organic growth is only 1%. Yes, you can exhaust your TAM and market.
#2. Pushing from 25% EBITDA Margins to 30%.
This is the goal of everyone at scale is to hit 30%+ margins, including Salesforce.
#3. 40,000 Customers, so about $25,000 on average per deal.
The classic mid-market that many try to avoid. But Blackbaud is making it work. And they do have a number of six figure and now seven figure deals.
#4. Substantially Increased Transaction Fees and Raised Prices on Renewals.
This is hardly unique, but helpful to see how everyone is handling increases that is doing them. Blackbaud is raising prices across the board.
#5. Not Seeing Much of a Downturn.
While Blackbaud’s growth isn’t epic in absolute terms, it’s also not seeing much of an economic impact in its core non-profit customers. Activity is barely down, if at all, at least for now.
|