The stickiness of revenue improves the reliability of forecasts. The recurring revenue model increases stickiness, but it doesn't guarantee growth, essential to any forecast.
SaaS businesses need to be heavily capitalized to avoid getting stuck in the SaaS cash-flow trough. While this can be annoying to operators and appear risky to investors, the trade-off is easily worth it for the consistency in revenue, particularly during an economic recovery.
Mark Partin shares his insight. Read full article