SaaS stands for Software as a Service, it is a type of eCommerce businesses which offers purely software products to its customers. A typical SaaS financial model contains a monthly forecast model that allows the company to estimate the number of users, subscription rates, churn rates, and average revenue per user (ARPU). A SaaS model builds on a traditional three statement model while also includes SaaS specific metrics such as customer acquisition cost (CAC), customer lifetime value (LTV), LTV/CAC ratio, and payback period. The model also contains discounted cash flow (DCF) valuation and sensitivity analysis to calculate and evaluate the company's enterprise value.
Components of SaaS Excel Financial ModelThis SaaS Excel model contains the following components:
- Business assumptions which drive the model
- Three statement model
- Supporting schedules such as fixed assets and debt
- Customer metrics used to evaluate the SaaS business
- Valuation of the business (NPV)
Purpose of the ModelThis SaaS financial model can be used for various purposes. Some of the most important uses are:
- To assess the economics of a SaaS business
- To determine if a new business idea is viable (applicable to startups)
- To value an online business in general
- To aid internal budgeting and planning for the operations
Screenshot from the template.
How to Use This SaaS Excel Financial Model TemplateDownload this SaaS financial model Excel template and start valuing a SaaS business! Once you have the template downloaded, replace the hard-coded assumptions in blue font with your own figures. The model will then perform all the calculations for your business and produce a valuation for the company based on your inputs. You can also modify the structure and layout of the model to match your business' specific needs, such as different revenue drivers and expenses items. We hope you find this Excel template tool useful for your financial analysis and valuation on a SaaS company!
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