How to scale your cloud company to $100 million?

Compiled by Bessemer Venture Partners, Learn these five key takeaways.

1. Prioritize Annual Recurring Revenue (ARR)

Focus on boosting ARR for valuations and growth. High growth and retention rates are important for sustaining momentum.

Successful companies often maintain growth rates of around 200% in the early stages, tapering to 60% beyond the $100M ARR mark.

2. Efficient cost management

Keep an eye on gross margins, which average between 65 - 70%, and optimize operational expenses.

As you reach $100M in ARR, aim for your R&D, sales & marketing, and general & administrative costs to align with industry benchmarks of 35%, 50%, and 20% of revenue, respectively.

3. Know your market value

Understand your company's worth, particularly with fundraising rounds. Be aware of how valuations evolve with scale to make informed decisions about growth strategy and fundraising efforts.

Historically, companies have seen valuations around 30x ARR in the early stages, which adjust as they grow.

4. Track progress strategically

Utilize industry benchmarks to monitor company progress effectively. Tailor your strategy around these insights for your discussions in board meetings and fundraising decks. Always stay a step ahead.

5. Prepare for public markets

Target public markets over $100M in GAAP revenue and plan for cash flow breakeven within the next few years. This sets a solid foundation for an IPO and long-term success.

Want to learn more?

Link to Bessemer video → https://lnkd.in/eAkfexY4