{"id":8734,"date":"2022-11-14T09:00:00","date_gmt":"2022-11-14T14:00:00","guid":{"rendered":"https:\/\/www.sage.com\/en-ca\/blog\/?p=8734"},"modified":"2022-11-04T15:59:31","modified_gmt":"2022-11-04T19:59:31","slug":"grow-saas-business-smart-way","status":"publish","type":"post","link":"https:\/\/www.sage.com\/en-ca\/blog\/grow-saas-business-smart-way\/","title":{"rendered":"How to grow your SaaS business the smart way"},"content":{"rendered":"<header class=\"entry-header has-dark-background-color entry-header--has-illustration entry-header--has-illustration--generic\">\n\t<div class=\"container\">\n\t\t<div class=\"entry-header__row row align-center\">\n\t\t\t<div class=\"col col-lg-7 col-xlg-6 entry-header__content\">\n\t\t\t\t\t\t\t<div class=\"component component-single-header\">\n\t\t\t\t\t\t\t\t\t\t<div class=\"entry-header__misc text--subtitle text--uppercase text--small\">\n\t\t\t\t\t\t\t<a href=\"https:\/\/www.sage.com\/en-ca\/blog\/category\/money-matters\/\" class=\"entry-header__link\">Money Matters<\/a>\t\t\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t<div class=\"entry-title-wrapper\">\n\t\t\t\t\t<h1 class=\"entry-title\">\n\t\t\t\t\t\tHow to grow your SaaS business the smart way\t\t\t\t\t<\/h1>\n\t\t\t\t<\/div>\n\n\t\t\t\t\t\t\t\t\t<p class=\"entry-header__description\">\n\t\t\t\t\t\t\t\t\t\t\t<\/p>\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\n\t\t\t<\/div>\n\n\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t<\/div>\n\t<div class=\"single-post-details container\">\n\t\t<div class=\"col\">\n\t\t\t<span class=\"posted-on \"><time class=\"entry-date published\" datetime=\"2022-11-14T09:00:00-05:00\">November 14, 2022<\/time><\/span><span class=\"reading-time\"> min read<\/span>\n\t\t<button\n\t\t\ttype=\"button\"\n\t\t\tclass=\"social-share-button button button--icon button--secondary js-social-share-button\"\n\t\t\tdata-share-title=\"How to grow your SaaS business the smart way\"\n\t\t\tdata-share-url=\"https:\/\/www.sage.com\/en-ca\/blog\/grow-saas-business-smart-way\/\"\n\t\t\tdata-share-text=\"Please read this interesting article\"\n\t\t>\n\t\t\t<span class=\"social-share-button__share-label\">Share<\/span>\n\t\t\t<span class=\"social-share-button__copy-label\" hidden>Copy Link<\/span>\n\t\t\t<span class=\"social-share-button__copy-tooltip\" aria-hidden=\"true\" hidden>Copied<\/span>\n\t\t<\/button>\n\n\t\t\t\t<\/div>\n\t<\/div>\n<\/header>\n\n\n<div class=\"wp-block-post-author has-dark-background-color alignfull\">\n\t<div class=\"container\">\n\t\t<div class=\"col\">\n\t\t\t\t\t\t\t<div class=\"co-authors\">\n\t\t\t\t\t\n\t\t<div class=\"entry-author-wrapper\">\n\t\t\t<a class=\"entry-author\" href=\"https:\/\/www.sage.com\/en-ca\/blog\/author\/asavinwattanajantra\/\">\n\t\t\t\t<img loading=\"lazy\" decoding=\"async\" width=\"40\" height=\"40\" src=\"https:\/\/www.sage.com\/en-ca\/blog\/wp-content\/uploads\/sites\/12\/2026\/03\/Asavin-350x350.jpg\" class=\"entry-author__image\" alt=\"Asavin\" srcset=\"https:\/\/www.sage.com\/en-ca\/blog\/wp-content\/uploads\/sites\/12\/2026\/03\/Asavin-350x350.jpg 350w, https:\/\/www.sage.com\/en-ca\/blog\/wp-content\/uploads\/sites\/12\/2026\/03\/Asavin-768x768.jpg 768w, https:\/\/www.sage.com\/en-ca\/blog\/wp-content\/uploads\/sites\/12\/2026\/03\/Asavin-810x810.jpg 810w, https:\/\/www.sage.com\/en-ca\/blog\/wp-content\/uploads\/sites\/12\/2026\/03\/Asavin.jpg 1000w\" sizes=\"auto, (max-width: 40px) 100vw, 40px\" \/>\t\t\t\t<span class=\"entry-author__name\">Asavin Wattanajantra<\/span>\n\t\t\t<\/a>\n\n\t\t\t\t\t<\/div>\n\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t<\/div>\n<\/div>\n\n\n\n<p class=\"\">Growing your Software as a Service (SaaS) business will be one of your biggest challenges but also one of your most satisfying.<\/p>\n\n\n\n<p class=\"\">Whether you\u2019re at that point already or need some understanding of how startup finances increase in complexity, we\u2019ve got the answers and more, so read on.<\/p>\n\n\n\n<p class=\"\">Here\u2019s what we cover in this article:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li><a href=\"#the\">The different growth phases<\/a><\/li><li><a href=\"#growth\">The Growth Stage<\/a><\/li><li><a href=\"#methods\">5 methods for handling startup finances<\/a><\/li><li><a href=\"#final\">Final thoughts: Use financial metrics to scale<\/a><\/li><\/ul>\n\n\n\n<p class=\"\"><div class=\"single-cta\">\n\t<a\n\t\tclass=\"button button--primary gate-2f754d1c-f351-46ed-b664-ddeba0b1c780\"\n\t\trole=\"button\"\n\t\tdata-button-location=\"content_area\"\n\t\thref=\"#gate-2f754d1c-f351-46ed-b664-ddeba0b1c780\"\n\t>Download your free copy of SaaS finance leaders: 5 steps to drive your company from early to growth stage<\/a>\n<\/div>\n<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"the\">The different growth phases<\/h2>\n\n\n\n<p class=\"\">When growing your startup, there are different phases of growth that you should understand. In the beginning, these are:<\/p>\n\n\n\n<ul class=\"wp-block-list\" type=\"1\"><li><strong>Pre-Seed Stage<\/strong><\/li><li><strong>Seed Stage<\/strong><\/li><li><strong>Early Stage<\/strong><\/li><li><strong>Growth Stage<\/strong><\/li><\/ul>\n\n\n\n<p class=\"\">The focus of this article is the Growth Stage. <\/p>\n\n\n\n<p class=\"\">If your startup is at this point, it\u2019s helpful to reflect on the journey so far.<\/p>\n\n\n\n<p class=\"\">You\u2019ve made it past the Pre-Seed and Seed Stages, where you\u2019ve validated the startup business model with the market and won initial finances to support your SaaS service or product.<\/p>\n\n\n\n<p class=\"\">You\u2019ve even conquered the Early Stage\u2014where turning your startup into a fully fledged business is a real possibility. You may have spent money on marketing and product development. <\/p>\n\n\n\n<p class=\"\">Because the business was new, you probably didn\u2019t have the resources to cover operational costs, so you could have turned to investors.<\/p>\n\n\n\n<p class=\"\">You released the product or service to the market, and customers have made purchases because of its price and quality. <\/p>\n\n\n\n<p class=\"\">You\u2019ve proven your revenue model by making sales. <\/p>\n\n\n\n<p class=\"\">Well done. Now what?<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"growth\">The Growth Stage<\/h2>\n\n\n\n<p class=\"\">Usually, the Growth Stage is when the business is profitable.<\/p>\n\n\n\n<p class=\"\">You\u2019ve figured out the product, market, and capital needed to scale. There\u2019s a definite demand for the product, and you\u2019re confident you can win new customers and keep existing ones. <\/p>\n\n\n\n<p class=\"\">It\u2019s where you need to focus on accelerating sales.<\/p>\n\n\n\n<p class=\"\">The Growth Stage is where you need to prove you can retain the customers you\u2019ve won and sell them additional bits on top. <\/p>\n\n\n\n<p class=\"\">You must provide evidence to investors that the business model is working, and customers are spending money from you a second, third time and so on, and not hitting the stop button.<\/p>\n\n\n\n<p class=\"\">This is where it gets financially trickier for a SaaS startup.<\/p>\n\n\n\n<p class=\"\">Although the SaaS business model and subscription-based cloud software offer great opportunities, finances run differently from traditional businesses.<\/p>\n\n\n\n<p class=\"\">All that juicy financial SaaS data needs tracking, which becomes even more complicated when the volume and complexity of your subscriptions increase. <\/p>\n\n\n\n<p class=\"\">Without automation, it can turn into a bit of a nightmare.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"methods\">5 methods for handling startup finances<\/h2>\n\n\n\n<p class=\"\">We can get deep into the dirty financial detail, but for now, let\u2019s keep it simple and talk about five tried and trusted methods for handling startup finances from Early Stage into the Growth Stage.<\/p>\n\n\n\n<p class=\"\">And you can use <a href=\"https:\/\/www.sage.com\/en-ca\/sage-business-cloud\/intacct\/\">modern cloud financial software<\/a> to track your finances too.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">1.&nbsp; Integrate your systems for quote-to-cash<\/h3>\n\n\n\n<p class=\"\">Quote-to-cash (QTC) is the name given to all the stages from a customer expressing interest in your product or service to that lovely cha-ching when money flows into your account.<\/p>\n\n\n\n<p class=\"\">The processes between where your sales team creates a quote and the proposal to where you receive payments for the services you provide are carried out by people in different parts of the business.<\/p>\n\n\n\n<p class=\"\">The systems used by the sales team and account managers might be separate from those used for order fulfilment, which might be separate from the systems used for billing and account receivables. <\/p>\n\n\n\n<p class=\"\">Sales can be a complex process that touches each of these areas.<\/p>\n\n\n\n<p class=\"\">With a SaaS startup, the aim is to remove any friction within the sales process, tying sales and financial data together to get one version of the truth.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">2.&nbsp;Establish flexible contract-based billing<\/h3>\n\n\n\n<p class=\"\">As a SaaS business, you deduct payments from customers repeatedly for the services or products you offer.<\/p>\n\n\n\n<p class=\"\">At the Growth Stage, you\u2019ll want to adjust your service and billing terms to fit changing market and customer requirements. <\/p>\n\n\n\n<p class=\"\">Expanding products or services to attract new customers and keep existing ones allows you to increase your pricing.<\/p>\n\n\n\n<p class=\"\">Successful SaaS businesses have flexible billing systems because there are various ways they might want to bill customers.<\/p>\n\n\n\n<p class=\"\">Business to business (B2B) customers might get great value from usage pricing where they only pay for how much they use. <\/p>\n\n\n\n<p class=\"\">In contrast, customers will find it easier to understand simple monthly flat fees in the consumer world.<\/p>\n\n\n\n<p class=\"\"><div class=\"single-cta\">\n\t<a\n\t\tclass=\"button button--primary gate-2f754d1c-f351-46ed-b664-ddeba0b1c780\"\n\t\trole=\"button\"\n\t\tdata-button-location=\"content_area\"\n\t\thref=\"#gate-2f754d1c-f351-46ed-b664-ddeba0b1c780\"\n\t>Download your free copy of SaaS finance leaders: 5 steps to drive your company from early to growth stage<\/a>\n<\/div>\n<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">3.&nbsp;Build end-to-end revenue management<\/h3>\n\n\n\n<p class=\"\">SaaS financial practices and auditing is more complex than traditional businesses.<\/p>\n\n\n\n<p class=\"\">Sooner or later, due to growth, your financial systems need to be ready for scaling up recurring revenue, which is different to a traditional order-based business.<\/p>\n\n\n\n<p class=\"\">Seed Stage startups often start managing their financial operations with spreadsheets and traditional accounting software. <\/p>\n\n\n\n<p class=\"\">But at the Growth Stage, managing recurring revenue for a growing customer base means hours upon hours of manual work.<\/p>\n\n\n\n<p class=\"\">Automation is critical here, as it eliminates the need to enter data manually, saving you bucketloads of time.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">4.&nbsp;Build real-time GAAP and SaaS dashboards<\/h3>\n\n\n\n<p class=\"\">Automatically connecting contracts to billing, revenue management, and the general ledger can supply you with both Generally Accepted Accounting Principle (GAAP) and SaaS metrics, both of which are critical to Growth Stage businesses.<\/p>\n\n\n\n<p class=\"\">GAAP metrics tell where you have been and where you are now, while SaaS metrics say where the business is going.<\/p>\n\n\n\n<p class=\"\">Look for real time and on-demand visibility to help you make immediate and strategic decisions without spending ages compiling the correct data.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">5.&nbsp;Forecast the future<\/h3>\n\n\n\n<p class=\"\">Tie financial systems with sales data to automatically generate forecasts, which can help guide decisions that make your business a success\u2014such as hiring and product investment.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"final\">Final thoughts: Use financial metrics to scale<\/h2>\n\n\n\n<p class=\"\">When you\u2019ve found a product and market fit, you must know how to build a repeatable and profitable sales process that you can scale as fast as possible.<\/p>\n\n\n\n<p class=\"\">Remember this\u2014the Early Stage and Growth Stage are dangerous points in the life of a startup. <\/p>\n\n\n\n<p class=\"\">Without the numbers, you\u2019re working on gut feeling, and the finances of SaaS businesses are too complicated to take that risk.<\/p>\n\n\n\n<p class=\"\">By following our five points (there\u2019s more nitty-gritty detail in our downloadable guide), you\u2019ll have the power to avoid some of the financial pitfalls you\u2019ll encounter growing a SaaS business.<\/p>\n\n\n<div class=\"single-cta\">\n\t<div class=\"single-cta__positioner\">\n\t\t<div class=\"single-cta__wrapper has-dark-background-color\">\n\t\t\t<div class=\"single-cta__content\">\n\t\t\t\t\t\t\t\t<h2 class=\"single-cta__title h3\">Subscribe to the Sage Advice Newsletter<\/h2>\n\n\t\t\t\t\t\t\t\t\t<div class=\"single-cta__description\">\n\t\t\t\t\t\t<p class=\"cta-content__title\">Get a roundup of our best business advice in your inbox every month.<\/p>\n\t\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t<a\n\t\t\t\t\t\thref=\"#gate-8949a954-88b2-43bb-8b8a-77c53eb34350\"\n\t\t\t\t\t\tclass=\"single-cta__button button button--primary\"\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t>Subscribe<\/a>\n\t\t\t\t\t\t\t<\/div>\n\n\t\t\t\t\t<\/div>\n\n\t\t\t\t\t<img decoding=\"async\" width=\"1440\" height=\"810\" src=\"https:\/\/www.sage.com\/en-ca\/blog\/wp-content\/uploads\/sites\/12\/2022\/04\/GettyImages-1073797282-1440x810.jpg\" class=\"single-cta__image\" alt=\"\" loading=\"lazy\" srcset=\"https:\/\/www.sage.com\/en-ca\/blog\/wp-content\/uploads\/sites\/12\/2022\/04\/GettyImages-1073797282-1440x810.jpg 1440w\" sizes=\"auto, (min-width: 48em) 33vw, 100vw\" \/>\t\t\t<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Learn about five tried and trusted methods for handling startup finances from Early Stage into the Growth Stage.<\/p>\n","protected":false},"author":356,"featured_media":8736,"menu_order":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_sage_video":false,"post_featured_image_hide":false,"footnotes":""},"categories":[7],"tags":[169,265],"business_type":[99],"lilypad":[],"context":[],"industry":[],"persona":[],"imagine_tag":[],"coauthors":[312],"class_list":["post-8734","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-money-matters","tag-business-strategy","tag-how-to-grow-your-business","business_type-medium-business"],"sage_meta":{"region":"en-ca","author_name":"Asavin Wattanajantra","featured_image":"https:\/\/www.sage.com\/en-ca\/blog\/wp-content\/uploads\/sites\/12\/2022\/11\/GettyImages-104187548.jpg","imagine_tags":[]},"distributor_meta":false,"distributor_terms":false,"distributor_media":false,"distributor_original_site_name":"Sage Advice Canada 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