SaaS industry slowdown

Extracted Attributes

• Current Trend

  Slowdown

• B2B New Sales Index (Q1 2025)

  1.409 (10% increase)

• Preference for Unified Platforms

  70% of companies

• Median YoY Growth (Public SaaS, 2024)

  Below 20%

• SaaS Application Reduction (2022-2024)

  18%

• SaaS Consolidation Rate (Year-over-Year)

  Slowed from 14% to 5%

• B2B SaaS Monthly Average CAGR (March 2025)

  3.1%

• IT Department SaaS Spend Management (2024)

  26%

• Average Yearly Deal Size Increase (Q4 2023)

  43%

• Average SaaS Applications per Company (2023)

  112 applications

• Average SaaS Applications per Company (2024)

  106 applications

• B2B SaaS Monthly Average CAGR (February 2025)

  -0.1%

• Individual Employee SaaS Spend Responsibility

  4%

• Individual Employee SaaS Application Quantity Responsibility

  34%

• Growth Rate (Best-performing SaaS companies, $1-30M sales, 2020)

  93.4%

• Growth Rate (Best-performing SaaS companies, $1-30M sales, 2021)

  78.9%

• Growth Rate (Best-performing SaaS companies, $1-30M sales, 2022)

  62.1%

Timeline

• Best-performing SaaS companies (with yearly sales between $1M and $30M) grew by 93.4%. (Source: web_search_results)

  2020

• Best-performing SaaS companies (with yearly sales between $1M and $30M) grew by 78.9%. (Source: web_search_results)

  2021

• Software companies experienced slower growth; best-performing companies (with yearly sales between $1M and $30M) grew by 62.1%. Average companies reduced their SaaS applications by 18% between 2022 and 2024. (Source: web_search_results)

  2022

• Companies making over $1 million a year started acquiring more new customers. (Source: web_search_results)

  2023-Q1

• The average number of SaaS applications per company was 112. The pace of SaaS consolidation slowed significantly, dropping from 14% to 5% year-over-year. (Source: web_search_results)

  2023

• The average yearly deal size increased by 43%. (Source: web_search_results)

  2023-Q4

• The median year-over-year growth for public SaaS companies fell below 20% for the first time. The average company had 106 SaaS applications. IT departments managed only 26% of SaaS spending. (Source: web_search_results)

  2024

• B2B SaaS growth fell dramatically. The Profitwell New Sales Index showed strong growth, increasing by 10% to an average value of 1.409. (Source: web_search_results)

  2025-Q1

• Monthly average Compound Annual Growth Rate (CAGR) for B2B SaaS was -0.1%. (Source: web_search_results)

  2025-02

• Monthly average Compound Annual Growth Rate (CAGR) for B2B SaaS was 3.1%. (Source: web_search_results)

  2025-03

Eldridge Industries

Eldridge Industries, LLC is an American holding company headquartered in Miami, with offices in New York City, Greenwich, Connecticut, London, and Beverly Hills. Eldridge Industries makes investments in various industries including insurance, asset management, technology, sports, media, real estate, and the consumer sector.

Web Search Results

• State of SaaS 2025 Report Reveals Operational Complexity and ...

  Slowing Rate of SaaS Consolidation: While companies now average 106 SaaS applications, down from 112 in 2023, the pace of SaaS consolidation has slowed significantly, dropping from 14% to just 5% year-over-year. Preference for Unified Platforms:A majority (51%) find managing SaaS with point solutions more challenging than using an all-in-one SaaS Management Platform (SMP), and 70% prefer a unified platform for optimizing spending, automation, discovery, management, and security. [...] Survey respondents cited increased IT workloads, continued reliance on manual processes, and heightened security and governance concerns as key contributors to SaaS management complexity. This complexity is further compounded by broadening adoption of artificial intelligence and associated funding constraints amid ongoing budget pressures. The report also marks the second consecutive year of decline in the average number of cloud applications per company. The average company has now reduced [...] their SaaS applications by 18% from 2022 to 2024 and companies now have fewer SaaS applications than in 2021.

• SaaS Industry Report 2024: A Comprehensive Overview - OMNIUS

  Image 17 4. Fastest Growing SaaS Startups and Companies in 2024 ------------------------------------------------------ Software companies grew slower in 2022 than in recent years. After doing really well in 2020 and 2021, things slowed down in 2022. The best-performing companies (with yearly sales between $1 and $30 million) grew by 62.1% in 2022. This is less than the 93.4% in 2020 and 78.9% in 2021. [...] 2. General Trends of the SaaS Industry 2024 ------------------------------------------- The SaaS industry continued its rapid evolution in 2024, with several key trends shaping the industry. Growth is slower and harder than the zero interest rate environments a few years ago. The average yearly deal size went up by 43% in 2023 in the last quarter. However, this upward momentum appears to be continuing into 2024, but it's still less than what it was, on average, over the last four years. [...] After about a year and a half of slow growth, companies are starting to get more new customers again. We're seeing some positive signs. Companies making over $1 million a year started getting more new customers in early 2023. Several SaaS startups and emerging companies experienced exponential growth in 2024, with Zscaler, Samsara, and Snowflake leading the pack.

• 111 Unmissable SaaS Statistics for 2025 - Zylo

  The SaaS market continues to demonstrate significant growth, with a trajectory that shows no signs of slowing. Here are some of the most important statistics that reflect the current state of the industry: [...] 2. SaaS Spend by Individuals: Interestingly, individual employees are responsible for 34% of SaaS applications by quantity, even though they contribute just 4% to the spend. This highlights the decentralized nature of SaaS decision-making within businesses​​. 3. IT Spend Decrease: IT departments managed only 26% of SaaS spending in 2024, down from 6.4 % the previous year. This trend highlights how purchasing decisions are becoming more decentralized​​. [...] _Source: OpenView Partners State of Usage-Based Pricing_ 4. SaaS Revenue Growth: In 2024, the median year-over-year growth for public SaaS companiesfell below 20% for the first time. These statistics underline the growing complexity and financial commitment associated with SaaS, making effective spend management, optimization, and renewal strategies essential for organizations looking to maximize value from their SaaS investments.

• SaaS market report for Q1 2025: Economic uncertainty brings ...

  So, why was this year’s holiday slowdown so large, and recovery so sluggish? Looking at the driving forces of B2B revenue growth: new sales & churn; and to a lesser extent, upgrades & downgrades, we can see exactly where the wheels began to come off. Image 20: SaaS Index - Q1 25 - B2B New SalesComing out of this year’s holiday slowdown, our Profitwell New Sales Index actually showed strong growth, increasing by 10% in Q1 to an average value of 1.409. [...] B2B SaaS growth fell dramatically in the first quarter of 2025. While a temporary, three-week dip over the winter holidays was to be expected, revenue growth remained stubbornly low throughout February and March as well, with monthly average compound annual growth rates (CAGR) of -0.1% and 3.1%, respectively. [...] Worse yet, the lacklustre growth continued into February and March, with CAGR averaging -0.1% and 3.1% respectively. This erased any opportunity for B2B’s gross revenue to fully recover from the holiday slowdown. Return of the churn... ----------------------

• 2025 State of SaaS trends - BetterCloud

  IT-to-employee ratio climbed to 1 IT person for every 108 employees, making the IT’s workload more difficult Almost 60% of IT still worries somewhat or a lot about Shadow IT More than half say budget pressure, along with too many underused apps and licenses are driving SaaS consolidation or spending cuts Companies have an average of 106 SaaS apps, down from 112 in 2023, showing a slowing rate of SaaS consolidation that dropped from 14% to 5% year over year.