Software companies are reporting a pretty good third quarter – Tech Crunch
Written By Alex Willhelm
It’s great news for startups looking for capital heading into 2021
What a difference a week makes.
But then, this week’s rally launched, and more earnings results came in. Generally speaking, the Q3 numbers from SaaS and cloud companies have been medium-good, or at least good enough to protect historically stretched valuations when comparing present-day revenue multiples to historical norms.
This is great news for yet-private startups that have had to deal with a recession, an uneven and at-times uncertain funding market, an election cycle and other unknowns this year. Wrapping 2020 with a market rally and strong earnings from public comps should give private software companies a halo heading into the new year, assisting them with both fundraising and valuation defense.
Of course, there’s still a lot more data to come in, markets are fickle and many SaaS companies will report next month, having a fiscal calendar offset by a month from how you and I track the year. But after spending time on the phone this week with JFrog’s CEO, BigCommerce’s CEO and Ping Identity’s CFO, I think things are turning out just fine.
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