☁ Latest thoughts on $PANW FCF

Lots of moving pieces in Palo's FCF

Billings has been the topic dejour with the guide lower

I've been trying to get my hands around the financing (with little success)

Here's a few random thoughts (still a lot of connect) 👇 Everone is focused on billings

but collections is the flip side of the FCF coin

Overall Collections as a % of Prior qtr billings has been decelerating for 3 qtrs in a row

Lining up with a 1 qtr lag from the big jump in financing receivables

☁ SaaS 101: Digging into SaaS FCF

Everyone talks like they know what FCF is

Very few do

👇 Let me help you (I use $DDOG as an example) 🤔 Investors have been crazy focused on FCF recently

Cash is harder to raise and there is greater uncertainty in the market

BUT

FCF is much harder than the income statement

AND

Normal methods don't work for SaaS

☁ SaaS 101: Revenue Forecasting

Forecasting revenue is hard

SaaS is a whole new language

👇 Let's dive in 🤓 Accounting professors will tell you revenue = P * Q

Forget that

The benefit of SaaS is everything is recurring

But now you need to think about ACV, ARR, TCV, Billings, and Bookings

☁ Time to move beyond the SaaS Income Statement

2023 is about FCF 💰

I sat down with @willsheldonvc at @Accel to chat all things CAC payback, FCF and billings

3 big takeaways from a top VC 👇 @willsheldonvc @Accel 📉 CAC payback periods lengthening

SaaS 🐐 @jaminball has a great chart of CAC payback periods over time

The problem?

Median payback period has drifted from <24 months to close to 40 months in recent months

☁ Digging into SaaS FCF

This method is so good it will feel illegal:

(I use $DDOG as an example) 🤔 Like many operators and investors, I’ve been spending a lot more time on FCF

BUT

FCF is much harder than the income statement

AND

Normal methods don't work for SaaS

☁️ 2021 Cloud Review Mega Thread

In case we just met, my name is Thomas and I work in Corp Finance @Celonis

I ❤ SaaS metrics, strategy and public markets

Grab a ☕, stretch your 👍, this is a long one

5 trends I'm thinking about 🧵👇 Top 5 Trends in SaaS:
1️⃣ First annual decline on record
2️⃣ Multiples driving relative performance
3️⃣ From Growth to Economics
4️⃣ PLG and Usage-Based Price FTW
5️⃣ Liquidity fueling a tech talent war