Many growth-stage SaaS companies have embraced the “land-and-expand” subscription business model to win an initial customer and then add value over time that allows for upselling additional products and features. But that creates a strong need to balance both volume and repeatability in automating their processes. Here’s how one company has achieved 100-percent growth using that model.
Utah-based Weave, offers a unique and powerful platform to improve scheduling, customer response, online reputation, team workflow, and revenue generation for healthcare practices. Weave helps practitioners increase and maintain their client base by building stronger relationships.
Previously, when new dental or optometry practices signed on, Weave’s finance team had to manually enter them into QuickBooks to manually invoice, manually collect, manually recognize revenue, and manually report for their business. It was a laborious – and non-scalable – paradigm for financial management.
Soon, growth overtook that elementary finance infrastructure. Facing the formidable task of issuing, tracking, and collecting from 2,000 customer invoices – and more growth on the way, thanks to a successful Series B round – Weave evaluated multiple cloud financial systems and selected Sage Intacct.
The key reasons? Sage Intacct’s ability to automate subscription billing, streamline revenue recognition, accelerate accounts payable/receivable, and strengthen reporting and forecasting – much better than order-based financial suites. Backed by Sage Intacct, Weave was able to pursue its land-and-expand model to
- Increase the number of invoices to 6,800 – a 245 percent increase
- Decrease closing times by 75 percent – from 20 days to five days
- Increase gross margin from 39 percent to 65 percent
- Create multiple billing offerings based on usage, product upsell, and payment terms
- Automate quote-to-cash processing to reduce time-to-bill by 50 percent
- Integrate credit-card processing to automate payments and cut DSO by 50 percent
- Create weekly executive reports, including CLTV/CAC analysis and other SaaS metrics, with dimensional analysis at the departmental level
A Rapid Payback – Without Staff Growth
Just six months after implementing Sage Intacct, Weave achieved a 100 percent payback on its investment – even as its business was doubling on an annual basis. Now, Weave has confidence in its forecasts based on a complete understanding of customer contracts, billings, revenue, and cash. This new financial infrastructure has given the company the agility to launch two new product lines – one aimed at optometry offices and another based targeting SMBs of any type.
Next up: a Series C funding round with a higher valuation thanks in part to immediate reporting on SaaS metrics of CLTV, CAC, churn, and ARR. In fact, Sage Intacct reduced the financial due diligence period from more than three months to just three days.
With Sage Intacct as the financial foundation, Weave has the governance and control to support its path to IPO while expanding from 78 to 288 employees – all with the same team of three finance pros and avoiding the need to hire 10 additional people. But don’t take my word for it: “Our relationship with Sage Intacct has been a partnership in the common goal of growth,” said Joel Meriwether, director of finance for Weave. “To have kept doing it the old way would have been a staff-killer.”