Examining the Sale Efficiency in Public SaaS Companies
Alex Clayton
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Great work Alex. A couple drivers came to mind when you noted SFDC’s poor ratio. The first and main driver I imagine is the LTV of their customer base. SFDC’s product is so sticky that they can afford to have a longer payback period in order to close more customers. Once you turn SFDC on, good luck ripping it out…

The second driver would be its ability to cross sell its base. SFDC has been on an acquisition spree as it tries to become an all encompassing platform across multiple functional groups. Think how the payback period shortens if you increase new business revenue by 25%-50% without much additional spend. Even if you remove the cross selling, its product grows as its customers grow and add additional seats with little to no additional sales and marketing expense.