What is it that makes SaaS so attractive to VCs?
In 2020, European VC’s invested around €12bn into the SaaS sector, with Romanian SaaS giant UiPath becoming one of Europe’s most valuable tech startups. After raising $225m in July, UiPath’s valuation rose to $10.2bn, making it the region’s first SaaS ‘decacorn’!
SaaS businesses provide predictable, recurring revenue. A monthly subscription to Netflix is a repeatable, secure form of income that can be grown by acquiring more subscriptions or increasing its cost, compared with a one-off payment to download a film. SaaS companies are extremely capital-efficient. You can build a large, profitable business for less than $10m in funding.
