SaaS narrative premium has permanently expired
The speakers argued that non-AI-first SaaS companies will no longer trade at speculative multiples, forcing them to be priced on rational cash flow and PE multiples.
The argument
Rory O'Driscoll argued that the era of 30x revenue multiples for standard SaaS is over, and even highly successful private companies will debut at fair value rather than narrative-driven premiums.
The thesis, stress-tested
✓ What validates it
- ✓Upcoming high-profile SaaS IPOs pricing at standard PE/growth multiples rather than historical revenue-multiple premiums
▸ Risks discussed
- ▸A macro rate-cut cycle could reignite speculative multiple expansion
- ▸A successful high-profile IPO could temporarily restore narrative premiums
Hear it yourself
"every day is a new day kind of market. Yeah. They have very different perspectives on what vendors to pick. Agreed. And presumably has better perspective. So the interesting thing about that, so the obvious question, what does that mean for the large AI companies? And so I have a couple of questions. One is, if the choice is between OpenAI, Claude, and Gemini, then it's still a nice cozy little oligopoly. To get in the game where you can be chosen by by an agent between it, do you still think it's just the state"
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