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SaaS Growth Report: Bootstrapped Firms Show Resilience, VC-Backed Outgrow Amid Market Volatility
Get your tech market update, 5 minute read.
Kristoffer Lindström
July 02, 2024
TECH BRIEF
The ChartMogul SaaS Growth Report analyzed the growth metrics of VC-backed and bootstrapped SaaS companies, revealing that bootstrapped companies adapt quicker to market volatility while VC-backed companies grow faster. With new business declining, both types are leaning more on expansion to drive growth. VC investment is increasingly difficult to secure, leading several companies to rely on their own sustainability and efficiency. With the post-pandemic investment slowdown, even VC-backed companies are struggling to reignite growth. The resilience of bootstrapped companies has been underscored in these cost-conscious times.
💡 Insight: Bootstrapped SaaS companies, though slower to reach scale compared to VC-backed ones, demonstrate greater resilience and adaptability in market volatility, stabilizing growth quicker. The reliance on internal revenue makes them frugal and enhances long-term sustainability, unlike their VC-counterparts driven by external funding. The current funding environment has pushed all SaaS businesses to balance between efficiency and expansion strategies, with customer retention posing significant challenges. Nonetheless, consistent top-quartile performance among bootstrapped firms suggests critical operational insights that could benefit VC-backed startups.
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