Growth might no longer be sufficient for SaaS enterprises. Jason Lemkin, a venture financier and expert on SaaS, gave his thoughts on Monday.com’s most recent earnings report yesterday. Lemkin emphasized the benefits he observed from the team productivity service’s Q1 results by mentioning the firm’s recent announcement of significant growth and 125 percent net revenue retention.
Regardless of whether the stock market concurs, Lemkin believes Monday.com’s rapid growth shows that, in terms of business, “things are still very, very good in SaaS.” The market-related point is a valid one. It has taken six months for the valuation of publicly traded technology businesses to alter, and the effects of last year’s private-capital boom are still being felt in the startup market. Despite the fact that the industry is as out of love with investors this year as it was in their hearts in 2021, Lemkin believes that SaaS fundamentals are still robust. It’s simple to understand why.
Even though the first quarter of Monday.com was quite positive, the company’s valuation has dropped from an all-time high of $450 per share to little over $100 as of this morning. Therefore, Monday.com is a wonderful illustration of how SaaS firms are now evaluated along a considerably steeper curve than they ever were. So let’s analyze its actual performance in comparison to Q1 expectations, the company’s projection in comparison to analyst predictions, and how to interpret the market’s perception of its state of health.
Unicorns should pay great attention to the resultant image. Who among unicorns wouldn’t want to share the results below, after all? Results for the first quarter and 2022 outlook released on Monday Monday.com announced sales of $108.5 million for the first quarter of its fiscal year 2022, an increase of 84 percent over the same period the previous year.
According to a press statement from the firm, their overall net dollar retention rate was 125 percent, up to 135 percent “for clients with more than 10 users” and 150 percent “for customers [worth] more than $50,000 in yearly recurring revenue.” Therefore, Monday.com had a fantastic first quarter in terms of growth.