Rules of 126 and 111

Indexed Forever links to a Bain Capital Ventures report on successful software companies. One of the points mentioned is that a new software company should focus on the rule of 126 – $100 million in revenue, 20% EBIT margins in 6 years.

That presumably would apply to companies with a licencing model. Indexed Forever offers a rule of 111 for “software as a service” companies: $100m, 10% EBIT, in 10 years.

Published by

Rajesh Jain

An Entrepreneur based in Mumbai, India.