Each quarter we look at the gross profit margin of every SaaS company that has IPO’d since October 2017. The data is below and shows gross profit margins holding very steady through Q2 2026 at 77%. All of this data can be found on our site at blossomstreetventures.com, and below is a table.
The long-term average is a very steady 76%, meaning the COGS of a software company aren’t 20%, but are more like 24%. So, don’t beat yourself up trying to get to an 80% gross margin; that’s just a rule of thumb. Get to 76% and you’ll be in great company.
Thank you for your readership. See more blogs and SaaS data at blossomstreetventures.com. Other resources we’ve built for founders include: SoftwareMultiples.com; softwareMRRcalculator.com; FounderInvited.com, and TwoFoundersTalk.com. Founders are always welcome to reach out to sammy@blossomstreetventures.com as well.
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