What’s the right level of G&A spend for SaaS businesses? The answer is of course “as low as possible”, but realistically there is a necessary baseline of SaaS spend. Below is G&A as a percent of revenue in 2024 and 2023 for SaaS companies that have gone public since October 2017 and are still public (63 in 2024). Observations follow:
G&A is hovering at 20%. The median spend on G&A as a percent of revenue has been 20% in 2024 and 2023. The average is nearly identical.
Profitable companies saw it increase. Interestingly, SaaS companies that were profitable in 2024 actually saw an increase in G&A, from 15% of revenue in 2023 to 18% in 2024. Not surprisingly, unprofitable SaaS saw a decrease, we suspect because unprofitable SaaS companies may be more diligent about cutting expenses to achieve profitability.
Obviously keep G&A spend as low as you can, but recognize that 20% of revenue on G&A seems to be a very normal baseline. Make that your goal.
Thank you for your readership. See more blogs and SaaS data at blossomstreetventures.com. Email the author at sammy@blossomstreetventures.com.
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