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SaaS Magic Number

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SaaS Magic Number

What is the SaaS Magic Number

The SaaS Magic Number is a widely used formula to measure sales efficiency. It measures the output of a year’s worth of revenue growth for every dollar spent on sales and marketing.

To think of it another way, for every dollar in sales and marketing expense, how many dollars of ARR do you create?

How to Calculate the SaaS Magic Number

saas magic number formula
SaaS Magic Number Formula

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Download the SaaS Magic Number slides below.

Additional Resources

Check out the in-depth post at The SaaS CFO – SaaS Magic Number

What the SaaS Magic Number of One is Not Telling You