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Public investors loved SaaS stocks in 2019, and startups should be thankful

The Cloud Index is a collection of SaaS and cloud companies that are trackable as a unit, helping provide good data on the value of modern software and tooling concerns.

If the index rises, it’s generally good news for startups as it implies that investors are bidding up the value of SaaS companies as they grow; if the index falls, it implies that revenue multiples are contracting amongst the public comps of SaaS startups.1

Ultimately, startups want public companies that look like them (comps) to have sky-high revenue multiples (price/sales multiples, basically).

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