SHOUT CALCULATORS

SaaS Valuation Calculator

Calculate an estimated valuation for your SaaS company based on annual recurring revenue and growth rate.

Grow your SaaS with Shout

Generate new leads, engage your audience, and collect vital feedback with one user-friendly platforn.

SaaS valuation calculator

The valuation process for a SaaS business can be complex, usually considering various factors unique to the industry. In the below calculator, only Annual Recurring Revenue and Growth rate are factored into your valuation.

Want to create a calculator just like this?

Engage your audience, increase traffic, and boost lead generation with expertly crafted calculators.

14-Day Free Trial • No Credit Card Required • Cancel Anytime

FEATURES FOR SAAS COMPANIES

Take your SaaS to the next level with Shout

User-friendly tools for capturing leads, qualifying them, and turning them into customers.

Generate new leads

Build quizzes and custom calculators to act as lead magnets, then email gate results to capture contact information.

Grow your email lists

Capture contacts with embeddable forms, and pass their information into our fully-compliant integrated CRM.

Gauge customer satisfaction

Identify what your customers love about your business and where they think you can still improve with

Power market research

Find survey respondents from all over the world, based on target criteria like job role, household income, hobbies, and more.

Measure Net Promoter Score

Create NPS surveys to identify your most loyal customers, calculate your net promoter score, and benchmark your performance.

Take feature requests

Allow customers to recommend and vote on new features, and even perform A/B tests in surveys to see what performs best.

SaaS valuation calculator FAQs

We answer some of the most frequently asked questions about SaaS businesses.

How is SaaS valuation calculated?

There are multiple methods by which you can calculate a valuation for your SaaS business. Let’s get into a few of those below.

Multiple of Recurring Revenue = This method involves applying a multiple to the company’s recurring revenue, such as Monthly Recurring Revenue (MRR) or Annual Recurring Revenue (ARR). The multiple is often based on industry benchmarks or the company’s growth, profitability, and other factors.

Net Profit Multiple = Some investors use the net profit (after all expenses) and apply a multiple to calculate the valuation.

Market Multiples = Valuation can be derived by comparing the SaaS company to similar publicly traded companies or recent transactions in the industry. This may involve using metrics like the Price-to-Earnings (P/E) ratio.

For our calculator above, we used David Cumming’s formula for SaaS valuation:

SaaS valuation = 2 x ARR + ARR x (1+ 2.5 x Growth Rate)

What is the Rule of 40?

The Rule of 40 is a metric commonly used to evaluate the balance between a SaaS company’s growth and profitability. The rule is expressed as the sum of the company’s growth rate and profitability margin, and the goal is for this sum to be equal to or greater than 40%.

The formula for the Rule of 40 is as follows:

Rule of 40 = Revenue Growth Rate + Profit Margin

What is the Rule of 72?

The Rule of 72 is a formula used to estimate the number of years it takes for an investment to double in value, given a fixed annual rate of return. The formula for the Rule of 72 is as follows:

Years to Double = 72 / Annual Return Rate (ARR)

How to calculate ROI for SaaS?

Return on Investment is a metric that allows you to quantify the success of a campaign, product or strategy as a percentage. The formula for ROI is:

Return on Investment = (Net Profit / Investment Cost) * 100