Sunday 2014-02-09

A couple days ago, Ray posted a link to Does average customer value matter? by Tom Tunguz. Since Tom's charts looked like ggplot2 plots, and that he had published his data, it seemed like a fun thing to check.

So I wrote up a quick r-markdown walk-through. Instead of finding that there was no optimal Average Customer Value, it appears that there are two clusters of ACV. And inside these clusters, companies with higher ACV have a higher probability of being net-income positive.

[permalink] Patrick, this is great. Thanks for sharing this!

[permalink] It's ok, we don't have a lot of data to work with, so any conclusions one way or another are highly speculative. That said, there's enough going on to make us want to get more data to see what will happen. Since there aren't too many public SaaS companies, maybe we wait a year and re-run the analysis with the old + new observations.