PeakSpan Capital and Ibbaka Release Net Revenue Retention Survey Results
SAN MATEO, Calif., NEW YORK and VANCOUVER, BC, SEPTEMBER 5, 2023 /PRNewswire/ -- PeakSpan Capital ("PeakSpan" or the "Firm"), a US-based investment firm with $1.5B+ in assets under management (“AUM”) focused exclusively on growth-stage business-to-business (“B2B”) software companies and Ibbaka Performance Inc. (“Ibbaka”), a provider of pricing optimization and value management software and consulting, have released the results of their survey on Net Revenue Retention.
The survey uncovered some key trends in Net Revenue Retention for SaaS. Overall performance is expected to decline from 2023. The percentage of companies expecting NRR to decline has increased 5% from 27% in 2022 to 32% in 2023. On the other hand, the number of companies projecting an NRR of more than 120% is up from 18% in 2022 to 22% in 2023.
The real insight though is the divergence in performance between and within SaaS verticals. The standout performers are the Artificial Intelligence companies and Data Analytics and Data Management companies, where there are many companies with NRR of more than 130%. The laggards are in HR and EdTech, where most companies are expecting negative NRR.
There are also differences within categories. One can find some stand-out performers in HR and EdTech, and not every data analytics company expects to do well.
“We are excited to partner with the Ibbaka team and share the results of this survey with the scale-up entrepreneurial community. It should be no surprise that strong capital-efficient growth and NRR performance are highly correlated. This report surfaces incredible insights to gauge relative performance for benchmarking across a whole host of relevant dimensions and surfaces powerful insights into tangible initiatives and programs scale-ups can deploy to drive best-in-class performance. It will be an invaluable resource for our portfolio partners!” says PeakSpan Capital Partner, Sanket Merchant.
Other insights from the survey relate to organizational design and pricing metrics. The companies with dedicated teams focused on NRR performance had both the highest confidence in their NRR projections and the highest projections. The companies with the lowest projections rely on sales to drive NRR. Another interesting finding is that companies with two or more pricing metrics, that is companies executing on hybrid pricing, are outperforming those with only one pricing metric.
“Net Revenue Retention is a key consideration in designing packaging and pricing models. One needs to enable NRR growth by making it easy to grow with your current customers while minimizing churn. The insights from this survey will help companies benchmark their performance against other companies in their vertical and decide how to make improvements.” adds Ibbaka CEO Steven Forth.
The full report can be accessed on the Ibbaka website using this link:
The PeakSpan - Ibbaka Net Dollar Retention Report
About PeakSpan Capital
Based in New York City and Silicon Valley, PeakSpan Capital is a leading growth equity firm with $1.5B+ in AUM and a singular mission to be the partner of choice for growth-stage entrepreneurial teams building amazing business software companies. PeakSpan has partnered with 70+ high-growth B2B software businesses and combines deep domain expertise within a select number of themes with an active partnering approach to help entrepreneurs drive excellent risk-adjusted growth and value creation. PeakSpan Capital prides itself on a collaborative approach to working with entrepreneurs and other stakeholders.
To learn more about PeakSpan Capital and its portfolio, please visit www.peakspancapital.com.
About Ibbaka
Ibbaka helps SaaS businesses optimize their packaging and pricing so that they can meet or exceed their key SaaS metrics. Ibbaka delivers through its pricing optimization and value management platform Valio and supporting data and services. AI is used to develop value models and derive pricing models based on the value a company delivers to its customers. Ibbaka delivers pricing strategies that are sustainable and adaptive, helping to shape markets and create categories.
To learn more about Ibbaka and Valio visit www.ibbaka.com
Media Contacts
For PeakSpan Capital
Sanket Merchant, Partner
+1 650 337 6003
For Ibbaka
Liam Hannaford
+1 778 898 1483