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@chamath@theallinpod@MeritechCapital Why not use LTM revenue as a better KPI for determining multiples. I also think GP instead of Revenue should be a better KPI to compare health for all venture backed startups.
We talked last week on @theallinpod about looking at long term multiples in SaaS and our friends at @MeritechCapital sent us this chart that they keep looking all the way back to the Salesforce IPO in 2004.
Bottom line is that 6x NTM revenue is the 20 year trend.
If you run a SaaS company and your last round was meaningfully above this metric, a solid piece of advice is to manage your burn until your NTM revenue x 6 == your last valuation.
How to turn $4,000 into $100,000,000+ 💸
They couldn't get a single investor to take them seriously...
That's when 4 friends decided to each invest $4,000 of their own savings to launch Chubbies.
(a 🧵 for DTC founders 👇)