5 Interesting Learnings From Monday.com at $870,000,000 in ARR

So Monday.com hasn’t been totally immune to “macro” impacts.  It’s seen its NRR come down from 2021 highs, and growth a bit down from its peak.  But overall, it’s still one of the top performing public SaaS companies:

• $880m ARR
• Growing 34% year-over-year
• 114% NRR
• 28% Free Cash Flow margins
• 48% growth in $50k+ customers

Boom!!

There are many secrets to Monday’s success at scale.  A big one is not being overly reliant on tech customers.  Co-CEO Eran Zinman and I did a deep dive on that and more at SaaStr Annual here:

5 Interesting Learnings:

#1.  Going Upmarket Key to Growth at Scale.  $50,000+ Customers Growing 48%

Monday’s numbers are pretty epic.  What you can see here is a big focus on $50,000+ customers:

#2. Still Growing New Customer Count +26%, Even at 225,000 Customers

This is where so many SaaS companies at scale are struggling now — to continue to add +20% new customer count a year.  HubSpot is doing it at 200,000+ customers — and so is Monday.  Both are growing their net new customer count > 20% at 200,000+ customers.

#3.  10+ Seat Customers Are 78% of Revenue

Monday isn’t leaving behind its SMB roots.  22% of its customers are still very small — less than 10 users.  But 20% are now $100k+ deals.  Enterprise and very much the “M” of medium.

#4.  NRR Down From 2021 Peaks, But Still Above 2020, and Strong at 110%

Monday’s NRR is impressive for a SaaS leader with so many smaller customers.  HubSpot’s by contrast, has fallen to about 100% from SMBs, and Asana’s NRR has fallen to 100% as well.  But Monday’s remains strong for a still SMB solution, at 110%.  That’s down from 125% at the peak of 2021, but interestingly, materially better than the 103% of 2020, in large part due to more enterprise deals and customers.  10+ user accounts have 114% NRR.

#5.  Becoming a Mighty Efficient Engine.  Free Cash Flow Margins Up to 28%

Monday flipped to cash-flow positive in 2021, mainly be holding the line on hiring.  It’s really clicking in 2024, with 28% free-cash flow margins now.

And a few other interesting learnings:

#6.  47% of Revenue Outside North America

HubSpot has a similar revenue split.  Go global as soon as its practical, folks!

#7.  Still Spending 56% of Revenue on Sales & Marketing — Although That’s Down From 113% in 2020

In 2020-2021, no one cared all that much about efficiency.  They cared about growth.  Today, they care about both, and Monday has tilted.  Still, while it’s held the line in growing headcount more slowly than growth, that doesn’t mean it’s stopped spending.  56% of all revenue goes right back into sales and marketing.

Monday is one of the very top performers in SaaS and Cloud today.  Approaching $1B in ARR, it’s still growing at top-tier rates (34%), still growing its net new customers > 20%, and still has top tier NRR from SMBs.

110% NRR + 34% Growth + 26% Net Net Customer Growth = A Very Strong Future.  Add in 28% Free Cash Marings, and it’s a pretty darn efficient future, too.

That’s the bar to crush it in SaaS today.  A high one, indeed.