Why You Need a SaaS Dashboard in Addition to Financials

I’ll be one of the first to say that financials are awesome, they’re great! A Profit and Loss Statement (P&L) can show you what the business is doing, a Balance Sheet can point to some inefficiencies with capital and leverage, and a Statement of Cash Flows shows where cash is primarily coming from (operating, investing, and financing activities).

Financials tell a great story, but for early, growing, SaaS businesses they don’t always tell the whole story. Some of my biggest Ah-ha moments of “The Why” behind a company came after viewing a company’s KPI Dashboard in addition to the financials.


For example: let’s look at Dunder Mifflin’s P&L from Q1 of 2017:

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At a glance this company has some good growth month to month. They are losing money, but this is common for growing SaaS businesses. Operating expenses look normal considering revenue and prior months. There’s some services revenue that impacts the quality of revenue, but not so much that you question whether this is a true SaaS business. Overall, nothing too out of the ordinary.

Let’s say this is a portion of Dunder Mifflin’s SaaS Metrics/KPI Dashboard:

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See anything?

Using both a Dashboard and Financials to see the big problem

The growth rate for the customers is solid, and the revenue growth month to month is good, as we could see from the P&L above as well, but there’s a really big problem, churn. Whether you see it from the Paying Customers view in the top table, or by MRR churn rate in the bottom table. It’s clear that Dunder Mifflin has a leaky bucket, meaning that they’re losing a significant amount of clients, even though they’re able to add a decent amount of new brands to keep things moving forward.

There could be a myriad of reasons for the churn. It could be the product itself, possibly the experience of the product, perhaps the onboarding or follow up process, maybe the clients being added are not great fits or expectations weren’t met, etc. Whatever the issue, it needs to be investigated, and early on a SaaS Dashboard can help you to identify where you may need to look.

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Early on a SaaS Dashboard help you to identify where you need to look

Also note that Dunder Mifflin is still paying commissions on 7 new clients, but if they’re losing 15%, 20% or even 32% of of their client base, their sales reps have to continually be adding a high amount of clients to keep pace. Even then, they still miss out on a portion of the best part of SaaS, recurring revenue.

Admittedly these are numbers from an imaginary business, but I’ve witnessed first hand the benefits of using it in tandem with your basic financials. This is only a small portion of a SaaS Dashboard, and P&L, but in this example, it’s easy to see how each can be helpful to piece together the whole story for a growing SaaS business.