40+ SaaS Statistics You Must Know In 2024

Software-as-a-service (SaaS) has become an integral part of the technology landscape in recent years. To get your head around the SaaS industry, you need to understand the latest SaaS statistics and trends.

This guide looks at the biggest changes impacting the SaaS industry. I’ll share the latest SaaS statistics ranging from SaaS usage, market size, and trends to SaaS valuation multiples and growth. 

Hopefully, this will open your eyes to see how the SaaS industry is taking shape and how you can position your product for success.

SaaS Usage Statistics

SaaS usage has rapidly increased to match the equally fast-growing market. Here are key statistics providing insight into the SaaS adoption rate among businesses.

• Organizations use around 130 SaaS apps, an 18% increase from 2021’s 110 average. (BetterCloud, 2023 State of SaaSOps)
• There has been significant growth in app usage since COVID. In 2016, the average company used 12 SaaS apps. That number is north of 100 today. (BetterCloud, 2023 State of SaaSOps)

• Large organizations with 10,000+ employees use about 410 SaaS apps. While businesses with 3,000-9,999 employees use around 152 apps, and small businesses with 200-749 employees use around 80 apps. Companies with 10,000+ employees use about 410 SaaS apps. Businesses with 3,000-9,999 employees use around 152 apps, and small businesses with 200-749 employees use around 80 apps. (BetterCloud, 2023 State of SaaSOps)

The 2023 BetterCloud report categorized the respondents into three main categories. The categories are based on the stages of SaaS maturity.

• 94% of companies plan to expand their tech stack in the next two years. (Torii, 2022)
• Half of the companies using several SaaS apps will centralize their SaaS app management by 2026. (Gartner)

SaaS Challenges Statistics

• Security is the top concern of companies and organizations using cloud-based software solutions. With at least 37% saying security breaches are their biggest concern in managing the SaaS stack. (BetterCloud, 2023 State of SaaSOps)

• The top SaaS security concerns among tech executives are Shadow IT (69%) and remote workers exposing data (56%). (Torii, 2022)

• 93% are concerned with SaaS apps’ data security. The top two concerns are the encryption of data within the service provider’s organization. The second concern is how to manage encryption with local encryption keys. (Thales Group)

• Lack of data privacy is a huge SaaS challenge. 40% of SaaS data access is unmanaged, creating significant security risks to organizations like massive data breaches. (DoControl).
• Onboarding and offboarding processes for SaaS tools take too long. 51% say getting a new employee access to the necessary tools takes more than a day. Another 35% say it takes more than a week. (BetterCloud, 2023 State of SaaSOps)
• In 2021, most SaaS organizations noted that offboarding is tedious and can take up to 7 hours/per user. (BetterCloud, 2023 State of SaaSOps)

SaaS Market Statistics

The SaaS market has been experiencing explosive growth, with all types of businesses adopting cloud-based solutions. Here are some stats to put the SaaS market growth into perspective.

• The SaaS industry has an estimated market size of $186.6 billion and an annual growth rate of 18%. (Zippia)
• The global SaaS market is expected to reach $720.44 billion by 2028. This is based on a Compound Annual Growth Rate (CAGR) of 25.89%. (Skyquest Technology)
• The web and video conferencing SaaS market value was $4.9 billion in 2020. But the market is projected to reach $10.9 billion by 2030, growing at a CAGR of 10.6%. (MarketResearch)
• The global government cloud market reached a value of $27.6 billion in 2021. This happened because of a shift to teleworking in 2020 due to the Covid-19 pandemic. The global government cloud market is projected to reach $71.2 billion by 2027, with a CAGR of 16.30%. (Research and Markets)
• The adoption rate of SaaS in the healthcare industry is growing at 17.8% per year. The healthcare cloud computing market is predicted to reach $89.4 billion by 2027 from $39.4 billion in 2022. (Markets and Markets)

SaaS Valuation Multiples

SaaS valuation multiples dropped significantly in 2022. This is seen as a correction after the 2021 high that was partly influenced by the pandemic. 

Generally speaking, SaaS companies with a higher rule of 40 get higher revenue multiples. Still, the multiples have dropped across the entire SaaS industry. 

• In Q1 2020, the Median EV/Revenue Multiples for B2B SaaS stood at 6.5X. This soared to 15X in Q1 2021 (Software Equity Group)
• In Q4 2022, the Median EV/Revenue Multiples for B2B SaaS had dropped to 5.2X.
• In Q1 2023, Q2 2023, Q3 2023, and Q4 2023, the median EV/revenue multiples dropped to 5.0X, 4.8X, 4.2X, and 3.8X consecutively. (Software Equity Group 2023 Report)

In 2023, some SaaS categories saw their valuation multiples improve from the previous year. For example, the DevOps & IT management category reported an improvement from 6.9X in Q4 2022 to 9.0X in Q4 2023.

Here’s how other major categories have been affected.

SaaS Trends Statistics

As the SaaS market evolves, businesses must stay updated on the trends and projections to make informed decisions.

This section will also touch on how SaaS marketing is different because of emerging technologies and innovations.

• Cloud marketplaces have become popular amongst SaaS companies. In 2021, 45% of the companies were actively selling on a cloud marketplace. A recent report predicted this would nearly double to 80% over the next two years. (State of The Cloud, 2022)

• In 2020 and 2021, there was a 120% increase in the number of unicorns. There were 520 in 2021. (State of The Cloud, 2022)

• In 2019, there were at least 35 private SaaS cloud companies with an ARR of at least $100 million. There were 50 such businesses in 2022. (State of The Cloud, 2023)
• Vertical solutions offer tailored products and insights. The total market cap of the Vertical SaaS Index grew by 18% between 2020 – 2021. Total revenue doubled from $14.9B to $29.5B. (State of Vertical SaaS 2022, Fractal)

Artificial Intelligence SaaS Statistics

• Artificial intelligence (AI) is one of the key SaaS marketing trends. The AI market size will reach $733.7 billion by 2027. That relies on a CAGR of 42.2%. (ReportLinker)
• Verified Market Research predicts the AI SaaS market will hit $1547.57 billion by 2030. 

• Enterprise AI SaaS had the largest market share in 2021 (58.04% with a valuation of $54.23 billion) and is expected to grow at a CAGR of 38.28% by 2030.
• SMB AI SaaS is valued at $39.20 billion and is expected to grow at a 36.76% CAGR by 2030.
• 35% of companies are using AI, while another 42% are exploring the use of AI. (IBM).
• 82% of cloud cloud-based companies have AI-powered features in their SaaS applications. (BVP, 2023)

• ChatGPT hit 100 million active users in January 2023, two months after its launch (UBS)

• ChatGPT gets 100 million weekly active users (TechCrunch)

Growth SaaS Statistics

• The global SaaS market revenue is projected to reach $369.4 billion by 2024. That would be double the $186.6 billion value in 2022 (Zippia)
• By 2025, 85% of the business apps used will be SaaS-based. (BetterCloud, 2023 State of SaaSOps)
• The global cloud computing market, the umbrella SaaS industry, is expected to grow at a CAGR of 16.3%. From $445.3 billion in 2021 to $947.3 billion by 2026. (ReportLinker)
• The global banking, financial services, and insurance (BFSI) sectors of the SaaS market are expected to reach $130.7 billion by 2027. That implies a CAGR of 19.2% during the 2022-2027 period. (BCC Research)
• The retail and e-commerce sector of the global SaaS market will reach $138.9 billion by 2027. That relies on a CAGR of 23.6%. (BCC Research)
• Gartner forecasts that the SaaS market will still see a 16.8% growth in 2023. (Gartner)

SaaS Category Statistics

• The AI category has taken all the limelight since OpenAI launched ChatGPT. The industry is expected to see a 37.66% CAGR from 2022 to 2030 to hit $1547.57 billion, according to Verified Market Research.
• The global video conferencing market is projected to grow from $6.87 billion in 2022 to $14.58 billion by 2029. This would mean an 11.3% CAGR. (Fortune Business Insights)
• Video conferencing companies have seen consistent growth. Zoom generated $4.09 billion in revenue in 2022. That’s up from $2.65 billion in 2021.  Zoom’s revenue is projected to reach between $4.370 billion and $4.380 billion in 2023. (Zoom)
• As of June 2022, Qualtrics was the leading SaaS customer relationship management and related software company. They have an ARR of $800 million. It was followed by Zoho at $500 million and Freshworks at $338 million. (Statista)
• The Average Contract Value (ACV) is increasing in popular software categories. The cloud data integration category is up 82%, mobile device management 84%, and project management tools 78%. (TechCrunch)

SaaS Pricing Statistics

Pricing is critical for SaaS companies since it impacts profitability and market positioning. This section discusses how SaaS companies price their products to get more clients and retain customers.

• Over 94% of pricing leaders in B2B SaaS update their pricing or packaging at least once every year.

• 38% of SaaS companies use a competitor-based pricing strategy. That means you analyze the competitors’ pricing and use it as a benchmark to inform your own pricing. 33% use value-based pricing, and 30% use a cost-plus pricing strategy. (Paddle)

• A premium-tier free trial is the most common free offering at 44%, followed by the freemium offering (19%), lowest-tier free trial (16%), and reverse trial (13%). 8% of companies do not provide any free offering. (Paddle)
• 33% of B2B SaaS companies have three subscription plans.

• Only 6% of companies conduct proper pricing research based on their customers. Up to 48% do not do any pricing research. (OpenView)
• As of 2021, only 48% of SaaS businesses tested their pricing. Only 17% conducted multiple rounds of testing. (OpenView)

• 82% of SaaS companies list their actual prices on their pricing pages (FastSpring)
• 44% of B2B SaaS companies prefer sales-negotiated pricing compared to fixed pricing at 34% and variable pricing at 24%. (Maxio)
• 78% of SaaS companies follow product-led growth strategies and offer potential customers free plans or trial periods. (FastSpring)

Regional Stats On The SaaS Industry

The SaaS industry is a global phenomenon, with businesses from all over adopting cloud-based systems to improve their operations.

• 56.67% of all SaaS companies are located in the United States. This accounts for around 17,000 of the 30,000 SaaS companies in the world today. (Latka)
• The UK has the second-highest number of SaaS organizations at 2,341, behind the US. This is followed by Canada, Germany, France, and India, which all range around 1,000. (Latka)
• The US market leads by a large margin. Holding approximately 14 billion customers globally, while the UK sector only holds 3 billion customers. (Statista)
• The largest SaaS company on the United States stock exchange, as of September 2023, is Adobe Inc. The company has a market cap of $255.4 billion. It’s followed by Salesforce., with a market cap of $218.7 billion. (Statista)

• China’s SaaS market has more than 42 companies that exceed $15 million ARR. (BVP)
• The Indian SaaS industry is projected to bring in $100 billion in revenues by 2026. (Business Standard)
• The European SaaS market is expected to grow over double its current size by 2025. Germany is expected to lead with an increase from €6.85 billion to €16.3 billion in 2025. (Statista)

• The African market is growing fast. The market size is expected to grow from $1.1 billion in 2023 to $1.58 billion in market volume by 2027. (Statista) 

Statistics On The Perceptions Of The Saas Industry

As the SaaS industry evolves, perceptions of the industry among businesses and consumers are also changing. Here are some of the statistics on general opinions of the industry.

• In a survey with 1724 respondents, 73% consider SaaS to be of some importance. Of the 73%, 38% deem SaaS to be “very important” to their business’ success, while 35% consider it “quite important.” (Harvey Nash)
• 70% of CIOs favor cloud-based SaaS for its business agility and scalability opportunities. (Deloitte)
• 28% of business leaders now view their tech stacks as a strategic advantage. 17% deem SaaS central to their organization’s future growth and direction. (Torii)

In Closing: Key SaaS Industry Statistics

The SaaS industry is currently going through its biggest transformation yet. Valuation multiples are starting to look promising once again. The rise of AI is also sending shockwaves across the industry, with more SaaS companies incorporating AI capabilities into their products.

You don’t want your company left behind. This guide shared software as a service statistics showing all these changes. Use these SaaS stats to make informed decisions that will boost customer satisfaction and product growth.