The Importance of Seasonality in SaaS Startups
For Google, seasonality is an important factor in forecasting quarterly revenue growth. In the advertising business, Q4 is always the strongest, followed by Q1. Q2 is the weakest. In Google’s latest financial year, the difference between the weakest and strongest quarters was 22%: $14.4B in Q4 and $11.8B in Q2.
I wondered if the same were true for SaaS companies. Should SaaS startup forecasts account for differences in underlying customer purchasing habits? While not subject to the consumer buying holiday cycle like advertising based companies, SaaS salespeople might be impacted by the vacation schedules of their customers or some other factors I couldn’t anticipate.


