Daily Data: Some SaaS sells better than others
One software company stands alone
Random Walk looks for silver linings and evidence that maybe the big technology companies will be the workhorses to pull us through. That dog will hunt.
Everything reads better in your browser or in the app. The footnotes especially, and Random Walk is really leaning into the footnotes. Plus, if you have the app, you can set delivery to “app only” and then my daily barrage will feel less like a barrage. Unfortunately, substack does not yet have a “Weekly Digest” option, but I’m hectoring them aplenty.
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One SaaS ahead of the field
Despite what it might seem like sometimes, Random Walk is genuinely optimistic about humanity and likes to highlight instances of (apparent) extraordinary achievement.
In this case, the achievement belongs to a software company.
Did you know that there is one software provider that has an Average Contract Value (ACV) that is twice as large as the closest competition?
Datadog (which can roughly be described as a data observability platform) averages ~$220K per contract.2
It’s in a league of its own (assuming the data is correct), and double (or more than double) some other mission-critical software, like Salesforce, Cloudflare or Zendesk (and more than 3X Snowflake).3
Via Tomasz Tunguz, Datadog is also lapping the field on a Revenue/Employee basis, as well:
Big contracts and not a lot of people is a good living, if you can get it.
Datadog does a lot of things, and has a very clear “land and expand” approach to building product and adding contract value, so maybe they can keep it up. The tailwinds around data observability are almost certainly there.
Since we’re on the subject of software, a few more random asides.
The #1 new software purchased?
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