#040: Klayvio, What the Future of SaaS Holds for 2024, Top 12 Public SaaS Revenue Multiples

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Oct 02, 2023

Klayvio

These guys set out to build a lifestyle business and ended up with an $8 billion software juggernaut.

Together they are going to take home ~$4 BILLION in the largest software IPO in recent years.

Here's the scoop on Klayvio:

In 2012, Andrew Bialecki set out to build a lifestyle business - a website devoted to cataloging the dates and locations of running races.

Bialecki found out the data he was looking for wasn't really available online.

He needed race organizers to provide it.

This wouldn't work as he was spending all of his time on the phone.

He was at a cross roads...

"Either I can go all-in on road races, or all-in on the larger problem:

‘How do we help businesses connect with the people using their software or products?’” recalls Bialecki.

Andrew realized that so many companies were unable to leverage non surface-level data to help grow their businesses. It was simply falling through the cracks. Not names and emails but other signals folks weren't really thinking about at the time:

Andrew had the perfect co-founder in mind, Ed Hallen. The two had worked together previously Applied Predictive Technologies, a tech consulting outfit. Andrew had this to say about Ed and their competitive advantage:

So in 2012, the two officially founded Klaviyo. They offer a software platform that helps businesses use their own data to create personalized consumer experiences across digital channels. They plug into existing storefronts like Shopify or Wix, and focus on 4 key pillars:

If you're wondering where the name comes from...

The two say it is inspired by “clavija”, a Spanish word for mountaineering pitons. These tools support climbers as they ascend, and catch them if they fall.

Their goal is to support and accelerate companies climb to the summit.

From 2012 to 2023 they have built an INSANE business. World class numbers. Incredible efficiency.

Let's "ooh" and "ahhh" at some of these:

ARR Growth:

$650M in ARR growing at 51% YoY (!!!!!!!!)

Retention:

119% Net Revenue Retention in the SMB category (!!!!!!)

Efficiency:

Klaviyo has raised ~$454M in primary capital since inception, of which they have spent only $15M.

WHAT?!?!?

Amazing.

The result of this?

The founders will be walking away with a cool $4B+ combined at IPO time.

And with these numbers, they deserve it...

Klayvio is an absolutely incredible company.

There hasn't been a SaaS IPO in years, but this is the type of business that can re-open the window.

Which is good news for all of us -- those founding, operating, and investing in the space.

Here's to you Klayvio!!!

One ‘How To’:

What the Future of SaaS Holds for 2024

Lot’s of nuggets here! Biggest takeaway, David Sacks’s fund Craft Ventures is investing 80% of their new capital into AI-focused comapnies.

One Vertical SaaS Breakdown:

Public Software Revenue Multiples

Not all vSaaS but still good to know!

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