SaaS Learnings from Rubrik’s IPO

Sammy Abdullah
3 min readMay 3, 2024

Last week there was a SaaS IPO, a cybersecurity company called Rubrik. We read through their S1 to see what we could learn about SaaS operations generally. Below is what we found, verbatim.

Going public in this environment requires lots or ARR, growing fast with excellent retention. “Our Subscription ARR grew from $532.9 million as of January 31, 2023 to $784.0 million as of January 31, 2024, representing a 47% increase. In addition, as customers experience the benefits of our platform, they typically expand their usage significantly, as evidenced by our average subscription dollar-based net retention rate of 133% as of January 31, 2024. We have seen our customer count grow to over 6,100 as of January 31, 2024 from over 5,000 as of January 31, 2023.”

Big operating losses are acceptable, so long as you have a true SaaS model that generates cash. “In fiscal 2023 and fiscal 2024, we incurred net losses of $(277.7) million and $(354.2) million, respectively. In fiscal 2023 and fiscal 2024, operating cash flow was $19.3 million and $(4.5) million, respectively, and free cash flow was $(15.0) million and $(24.5) million, respectively.” The difference between net losses and operating cash flow was cash collected from annual-pay contracts. Cash collected from annual pay contracts in 2023 and 2022 was $300mm and $339mm respectively.

Their pricing is simple and easy to understand. “Our platform can be purchased in three subscription editions. Our various editions include a combination of products across data sources (enterprise, cloud, and SaaS applications). We price our subscription editions primarily based on edition tier and data volume.”

Outbound sales for large prospects, while inside sales team handles smaller ones. “We primarily sell subscriptions of RSC through our global sales team and partner network, where we target the largest organizations worldwide to mid-sized organizations. We also sell to smaller customers through a high-velocity engagement model driven by our inside sales team.”

Good ‘ole land and expand. “We utilize a land and expand approach. Expansion happens along three vectors: the growth of data from applications already secured by Rubrik, new applications secured, and additional data security products. This expansion is driven by a natural flywheel effect in which the value of our platform increases as our customers’ data grows across various applications.”

Over time, you need to shift the focus to larger customers. “Additionally, as of January 31, 2019, 2020, 2021, and 2022 the number of customers generating more than $100,000 in Subscription ARR was 23, 137, 309, and 628, respectively.”

Support is bundled with the subscription. Don’t let the customer decide on whether to buy support. “Subscription term-based licenses provide our customer with a right to use the software for a fixed term commencing upon delivery of the license to our customer. Support services are bundled with each subscription term-based license for the term of the subscription.”

The above is basic SaaS best practices. Do the same and you could be on your way to an outcome as good as Rubrik’s.

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