KBS - Software-as-a-Service - Market Insight

7. CHURN, ENGAGEMENT & USAGE METRICS Investors closely evaluate:

• Daily/Monthly Active Users (DAU/MAU) • Feature adoption rates

• Expansion revenue from upsells • Churn below 5–10% annually

Low churn and strong usage signal product-market fit and enhance valuation multiples.

8. PRIVATE EQUITY & STRATEGIC CONSOLIDATION ACTIVITY • The SaaS sector remains a top target for private equity roll-ups and strategic cloud acquisitions. • High consolidation activity increases competitive tension, boosting valuation multiples. 9. VERTICAL SPECIALISATION & REGULATORY ALIGNMENT • SaaS companies tailored to industries with complex regulations (healthcare, finance, construction, legal) command higher valuations. • Vertical SaaS benefits from very high switching costs and lower competition.