Maxio Institute Report Establishes Funding Trifecta for Successful Companies, Sees Potential "Trickle-Down Macroeconomics" from Fed Cuts
ATLANTA, GA / ACCESSWIRE / October 31, 2024 / Just days before the U.S. Presidential Election and a critical meeting of the U.S. Federal Reserve, leading billing and financial operations platform Maxio released third-quarter results of the country's largest quarterly study of billing data from private B2B software companies. As a new macroeconomic environment emerges, smaller software companies should see a resurgence in funding in 2025, particularly those that have met certain performance criteria to date.
The Maxio Institute Q3 B2B Growth Report, which studies the anonymized billing and invoicing data of over 2,000 customers, stated that while businesses - particularly smaller ones in early growth stages - have yet to see a windfall of funding from the Fed's half percentage point cut in September, that should change in early 2025 and be supercharged if rates are cut again at next week's meeting.
"We've been in a period where ‘growth at all costs' shifted toward ‘efficient growth,' and while the dollar amounts of VC deals has started to increase, the total number of VC deals continues to trend down," said Maxio CEO Randy Wootton. "We're all waiting for the resurgence of B2B investment, but it's the ripple effect of behavior change. The Fed is a good signal and a second cut would be a double boon."
With the economy and small business at the heart of the ongoing Presidential election, Wootton said that the companies that benefit most from "trickle-down macroeconomics" are those that have achieved Maxio's "Funding Trifecta" and have:
Reached Series B funding
Raised $10 million or more
Executed a raise within the last three years
Other highlights of the Maxio Institute Q3 B2B Growth Report include:
While private B2B SaaS companies are still growing faster than their public market peers, annualized growth rates dropped quarter-over-quarter to 15 percent
Companies with less than $1 million in annual revenue continue to gain momentum from their low point in late 2022, growing 23% in Q3 compared to a more modest 12% growth rate for those over $1 million
The overall cooling growth has led to a narrowing in the gap between companies employing fixed-rate and usage-based pricing models
Growth has been slower for fixed-rate companies both below and above $1 million in annual revenue while usage-based companies have grown rapidly in both categories, most notable for those under $1 million in revenue
"The combination of these changing industry factors and the uncertainty in Washington could extend the relative caution into the first quarter of next year," Wootton said. "But the overall growth and expected availability of capital should keep us on track for this soft B2B recovery."
For more insights, access the full report here.
About Maxio
Maxio empowers B2B companies to unlock their next stage of growth. Our billing and financial operations platform is designed to meet the unique challenges of B2B SaaS and recurring revenue businesses, including fixed-rate and usage-based billing, subscription management, revenue recognition, payment processing, metrics and analytics. Maxio, formerly Chargify and SaaSOptics, is backed by Battery Ventures and processes more than $16B in annual revenue for over 2,000 customers.
For more information, please visit https://www.maxio.com/.
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SOURCE: Maxio
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