EP 012 | Growth Under Pressure, Eileen Tobias: When Is Your SaaS Company Ready for an IPO? A CFO's Guide to Going Public

Your SaaS company is ready for an IPO when you've reached at least $200M in annual revenue, achieved a Rule of 40 score (revenue growth rate + profit margin ≥ 40%), built public-company-grade financial processes, and assembled a leadership team ready for quarterly scrutiny. Most importantly, you need sustained business fundamentals that prove you can thrive in public markets for the long haul—not just ring the bell once.

TL;DR

• Scale matters: $200M+ revenue is the modern IPO threshold for SaaS companies
• Rule of 40 is non-negotiable: Public investors demand both growth AND profitability
• Process before pressure: Build financial hygiene early—audit-ready books, clean metrics, SOX controls
• Leadership readiness counts: Your C-suite and board must be prepared for quarterly earnings cycles and public scrutiny
• Cultural transformation required: Going public changes employee accountability, compensation structures, and decision-making rhythms
• IPO isn't the finish line: It's a starting gun for a decades-long marathon in public markets
• Consider the alternative: Staying private longer (or forever) may preserve optionality and culture

Why Do Some Founders Dream of IPOs—While Others Run From Them?

It was 2007. Eileen Tobias was part of the finance leadership team taking NetSuite public—right before the 2008 recession hit like a freight train.

"We went public right before the recession," Tobias recalls. "We were really getting our legs under us and maturing as an organization while we were in the public markets."

That timing? Brutal.

Revenue growth flatlined. Churn spiked—not because the product failed, but because customers were hemorrhaging cash. For six to eight quarters, NetSuite treaded water while public investors watched, skeptical and unforgiving.

But here's the plot twist: NetSuite didn't just survive. After that dark stretch, they posted five consecutive years of 30%+ growth and eventually sold to Oracle.

Fast forward to 2018. Tobias was part of another IPO—this time with Dropbox, a unicorn that had waited years to go public and was already north of $1 billion in revenue. "It was two very different experiences," she says.

One company went public early and matured in the spotlight. The other built scale, sophistication, and profitability in private, then entered public markets as a fully formed juggernaut.

So which path is right for your SaaS company?

Let's pull back the curtain on what actually happens when a CFO prepares a company to go public—and when it makes sense to skip the IPO circus altogether.

What Does "IPO-Ready" Actually Mean for a SaaS Company?

If you ask most founders, "IPO-ready" means hitting some magic revenue number, hiring a big-four auditor, and calling Goldman Sachs.

Wrong.

IPO readiness equals sustained business fundamentals plus financial maturity plus cultural transformation.

Tobias breaks it down into three core questions every CFO must answer before entering public markets:

First, accountability. Are you and your leadership team ready for the spotlight and scrutiny of public markets?

Second, business fundamentals. Do you have product-market fit, financial discipline, and a proven path to sustained profitability?

Third, employee alignment. Is your entire company ready for the operational cadence, governance requirements, and quarterly earnings pressure of being public?

"It's a big undertaking," Tobias says. "A lot of companies are very focused on getting to the day when you ring the bell… but that's just a one-time event. After that, you have to be ready for that sustained marathon of running a company in public markets for the foreseeable long term."

The bell-ringing is theater. What comes after is decades of discipline.

What Revenue Benchmark Do You Need to Go Public?

Let's get specific.

You need at least $200 million in annual recurring revenue to be taken seriously in today's public markets—and that's table stakes for SaaS companies.

"Certainly, you need to get to scale," Tobias explains. "You need to get to at least a couple hundred million in revenue to be taken seriously about entering the public markets."

Why $200M?

Because public investors want proof of repeatable, scalable growth—not just a hot product or a lucky quarter. At $200M, you've survived multiple expansion phases, economic cycles, and competitive threats. You've shown you can acquire, retain, and expand customers at scale.

But revenue alone isn't enough.

Runway is the number of months your company can operate before running out of cash—critical for early-stage companies. By the time you're approaching IPO territory, runway concerns should be replaced by profitability metrics and margin discipline.

At the seed stage with zero to $1M in revenue, you need clean books and basic forecasting. When you hit Series A territory—$1M to $5M—you need a fractional CFO and a 13-week cash flow forecast to survive.

By Series B and C, typically $5M to $50M, you need a controller, audit-ready financials, and serious KPI discipline. Pre-IPO companies at $200M and above need a full finance team, SOX compliance capabilities, and that crucial Rule of 40 score we'll discuss next.

The Rule of 40: Why Public Investors Demand Both Growth AND Profitability

Here's the metric that separates IPO contenders from pretenders: the Rule of 40.

Rule of 40 equals Revenue Growth Rate (%) plus Profit Margin (%) and should be greater than or equal to 40%.

"These days, you can't just enter the public market with high growth," Tobias says. "Public investors want to see profitability as well. Companies have to either be on that path of profitability or show that they're very close to it."

Why the Rule of 40 matters:

It forces discipline. You can't just burn cash to buy growth anymore.

It signals maturity. You understand unit economics and can operate efficiently at scale.

It predicts valuation. Public SaaS companies with higher Rule of 40 scores command premium multiples according to SaaS Capital's 2024 benchmarks.

Let's look at some examples.

If you have 40% growth and 0% margin, you hit 40—technically acceptable, but investors prefer seeing actual profitability. If you achieve 20% growth and 25% margin, you get 45—that's the ideal balance public markets love. But if you're at 50% growth with a negative 20% margin, you only score 30, and that growth-at-all-costs model won't fly in public markets anymore.

When Tobias took Dropbox public in 2018, the company was already north of $1 billion in revenue and had proven it could balance growth with profitability. That's why there was "pent up demand and excitement" for the IPO—investors knew Dropbox wasn't a gamble.

What Financial Processes Must Be in Place Before You Go Public?

Going public isn't just about hitting revenue targets. It's about proving you can operate like a public company before you become one.

Here's what needs to be rock-solid:

Audit-ready financials. Your monthly close process needs to be completed within 10 business days, maximum. If you're taking three weeks to close your books, you're not ready.

SOX compliance readiness. Even if you're not yet required to comply with Sarbanes-Oxley, your internal controls need to be documented and tested. The public markets won't give you a grace period to figure this out.

Clean revenue recognition. You need ASC 606 compliance with no revenue timing games. Public investors can smell accounting gymnastics from a mile away.

KPI consistency. Your metric definitions need to be locked in with no switching metrics to make numbers look better. More on this crucial point later.

Board-level reporting. You should already be delivering quarterly business reviews with investor-grade slide decks that could survive public scrutiny.

Scenario planning. Upside, baseline, and downside financial models need to be ready to go—because public markets don't care about your single forecast.

Data room readiness. Three years of clean financial statements, contracts, and cap table documentation should be audit-ready and organized.

"I think when companies can focus even just a little bit as they mature on good processes—whether in sales ops, HR, finance, or legal—it really helps later as they're thinking about an exit," Tobias advises.

What happens if you don't build these processes early?

You face drawn-out due diligence, lower valuations, and potentially blown deal timelines. "If you don't have your processes and financials in good order, it makes those other things more costly," Tobias warns.

The companies that get premium valuations? They make due diligence boring. Everything is documented, organized, and audit-ready before the first investor call.

Why Some Companies Shouldn't Go Public (And That's Okay)

Here's the truth nobody tells you: staying private might be the smarter move.

Tobias highlights a critical trade-off: "When you're a private company, you have a bit more latitude in terms of being focused on the long term and less on the short term."

Translation: Going public puts you on a quarterly treadmill that never stops.

Why you might want to stay private:

You can preserve long-term thinking. No quarterly earnings pressure means you can invest in three to five year bets without Wall Street panic. Want to spend two years rebuilding your core infrastructure? Good luck explaining that to public market analysts who want growth this quarter.

You maintain culture. Going public means compliance overhead, insider trading training, and risk-averse decision-making that can kill the entrepreneurial spirit that built your company.

You control your narrative. Private companies can pivot, experiment, and fail privately without stock price penalties. One bad quarter won't wipe out 30% of your market cap overnight.

You preserve exit optionality. M&A buyers often pay premiums for private companies versus acquiring public stock. Sometimes the best path to maximum value is staying private until the perfect acquirer comes along.

Tobias's most recent role was CFO at Komodo Health, a healthtech unicorn valued in the billions that has chosen to remain private. They've done multiple acquisitions, raised significant funding rounds, and maintained profitability—all without public market scrutiny.

Sometimes the best IPO strategy is not doing one at all.

The pressure to go public often comes from investors who want liquidity or founders who want validation. But if your business fundamentals are strong and you can access growth capital privately, there's no rule that says you have to go public.

How Long Does IPO Preparation Actually Take?

18 to 36 months.

That's the realistic timeline from "We're thinking about going public" to "We're ringing the bell on NASDAQ."

Let's break down what happens during each phase.

Foundation phase: 18 to 24 months out. This is when you hire your CFO if you haven't already, implement SOX-ready controls, and get your financials audit-clean. You're building the infrastructure that everything else depends on.

Build the team phase: 12 to 18 months out. Now you're adding specialized roles—VP of FP&A, an Investor Relations lead, and upgrading your accounting systems. You might move from QuickBooks to NetSuite or another mid-market ERP solution.

Roadshow prep: 6 to 12 months out. This is when you draft your S-1 filing, select your underwriters, and finalize your narrative and metrics. Every number will be scrutinized, every claim will be challenged.

Go-live phase: 3 to 6 months out. SEC review process, investor roadshow, pricing, and launch. You're living in conference rooms and hotel suites, pitching your company hundreds of times to institutional investors.

"There's a lot of training that goes on with the employee base in the run-up to a public offering," Tobias notes.

Insider trading policies, lock-up periods, blackout windows—your entire company needs to understand what changes when you go public. Your engineers can't casually mention user growth numbers at a conference anymore. Your sales team can't tweet about their best quarter ever without clearing it with legal.

And here's the kicker: the IPO is just the beginning.

After you go public, you enter a "sustained marathon" of quarterly earnings calls, annual guidance, investor relations, and market volatility. Miss your guidance by 5%? Watch your stock drop 20%. Beat expectations? Maybe you get a 10% bump that evaporates by next quarter.

What About KPIs Beyond Revenue and Profitability? Do They Matter for IPO?

Short answer: Absolutely.

Tobias emphasizes that retention, LTV:CAC ratio, gross margin, and net dollar retention all feed into the metrics public investors care about most.

Net Dollar Retention (NDR) measures how much revenue you retain and expand from existing customers. 120% or higher is gold standard—it means even if you never acquired another customer, your revenue would grow 20% year-over-year from expansion alone.

Gross Margin needs to be 70% or higher for pure SaaS companies. Lower margins signal you're not truly a software business or you have cost structure problems that will limit profitability.

LTV:CAC Ratio (Customer Lifetime Value to Customer Acquisition Cost) should be 3:1 minimum, with 5:1 or higher being exceptional. This proves you can acquire customers profitably.

Payback Period—how long it takes to recover your customer acquisition cost—should be under 12 months. The faster you recover CAC, the less capital you need to fuel growth.

Magic Number measures sales efficiency. Above 0.75 signals you're converting sales and marketing spend into revenue efficiently.

"You're not going to have great revenue growth and margin numbers if you don't have healthy retention and LTV:CAC metrics," Tobias points out.

These aren't vanity metrics. They're the foundation that makes your headline numbers possible.

But here's a critical warning: Don't play games with your KPIs.

"Sometimes companies will start with a metric set, and they don't really like how those metrics are working, so they'll switch to a different definition," Tobias cautions. "I would advise folks to be thoughtful about when you abandon a metric or change a metric. Make sure you're doing it for the right reasons."

Tobias has seen it happen countless times. A company calculates LTV one way, doesn't like the result, so they change the retention assumption or extend the time horizon until the number looks better.

Public investors see through this instantly.

If you've been reporting NDR one way for three years, then suddenly change the calculation right before your IPO, that's a massive red flag. It signals either that you don't understand your own business or worse—that you're trying to hide deteriorating fundamentals.

Real example from Tobias's experience: She once worked with a company that had four or five different versions of LTV calculated different ways. When it came time to present to investors, the team wanted to show "LTV with nine months of retention" or "LTV with 18 months of retention" instead of actual LTV based on real customer behavior.

That's not strategic storytelling. That's fiction.

The companies that command premium valuations? They pick their metrics, stick with them, and improve the actual business performance rather than gaming the definitions.

What Changes Inside Your Company When You Go Public?

Going public isn't just a finance event—it's a cultural transformation.

Quarterly earnings cadence becomes your new reality. Every 90 days, you report to the public and face analyst scrutiny. Miss your numbers by 2%? Prepare for uncomfortable questions about whether your business model is broken.

Stock-based compensation changes everything. When employees could only see their equity value during fundraising rounds, they focused on mission and product. Now they can watch their net worth fluctuate daily. Some employees will spend more time checking the stock price than doing their actual jobs.

Governance overhead multiplies. Board meetings, audit committees, disclosure controls, 10-Qs, 10-Ks, proxy statements—the administrative burden of being public is substantial. You'll need to build a team just to manage public company compliance.

Media exposure intensifies. Everything you say can move your stock price. A casual comment about slowing enterprise sales in an interview? That could trigger a 10% stock drop and angry calls from institutional investors.

Insider trading rules affect everyone. Blackout periods mean employees can't sell stock for weeks before earnings. Pre-clearance requirements mean executives need approval before every stock transaction. Mandatory training becomes part of onboarding.

"When you enter the public markets, you're accountable to a much broader portfolio of investors," Tobias explains. "You're much more in the media, and you're much more tied to that quarterly cycle."

This is why leadership readiness is one of the three pillars of IPO preparation.

Your CEO needs to become a public spokesperson who can stay on message under hostile questioning. Your CFO becomes the face of investor relations, hosting quarterly earnings calls where every word is parsed for hidden meaning. Your board needs independent directors with public company experience who understand SEC requirements and Sarbanes-Oxley compliance.

If your leadership team isn't ready for this transformation, you're not ready to go public—no matter what your revenue number says.

Tobias saw this firsthand at NetSuite. The team had to learn how to operate in the public spotlight while simultaneously fighting through a recession. "Those are pretty tough times, especially as a finance leader," she recalls. "It took a lot of resilience and just a belief that we had the right fundamentals."

IPO vs. M&A: How Do You Decide Which Exit Path Is Right?

Here's the question every CFO wrestles with: Should we go public or sell?

The IPO path offers compelling advantages. You get access to public capital markets for future growth—need $500M to fund an acquisition? Public companies can raise that in weeks. You provide liquidity for employees and early investors without losing control. You gain brand prestige and market validation that opens doors with enterprise customers. And you get currency in the form of public stock that you can use for acquisitions.

But the costs are real.

Quarterly earnings pressure never stops. Compliance costs run $2M to $5M per year for SOX audits, public reporting, and investor relations. You lose privacy and strategic flexibility—every move you make is public information your competitors can see. Market volatility impacts employee morale when the stock drops 30% because the NASDAQ had a bad month.

The M&A path has its own logic. You get an immediate liquidity event with cash at closing. There's no public market risk—you don't have to worry about your stock price tanking because some analyst changed their rating. You gain strategic resources and distribution from your acquirer. And often, acquirers pay higher valuations for mid-stage companies than those companies could achieve in an IPO.

The downsides? You lose independence. Cultural integration can be brutal—suddenly you're following the acquirer's processes, politics, and priorities. There are often earnouts and retention requirements that tie founders to the company for years. And sometimes the acquiring company's stock (if it's a stock deal) performs worse than you would have as an independent public company.

Tobias's experience with NetSuite—which went public and then later sold to Oracle—shows that these aren't mutually exclusive paths.

Sometimes the best strategy is to go public first, prove your value in public markets, and then get acquired at a premium. NetSuite proved it could thrive as a public company for nearly a decade before Oracle paid $9.3 billion to acquire it in 2016.

That's a very different outcome than selling earlier as a private company.

What's the Single Biggest Mistake CFOs Make When Preparing for IPO?

Waiting too long to build financial infrastructure.

"If you don't spend time focusing on operations and processes, but you're experiencing a lot of fantastic growth, then suddenly it's like, 'We want to do another round of fundraising or go public or we're being evaluated for M&A,'" Tobias says. "If you don't have your processes in order, it just makes those other things more costly and the processes get drawn out."

Translation: Don't wait until 12 months before IPO to hire your first controller.

The companies that execute smooth IPOs? They started building their financial foundation years earlier—when they hit $5M in revenue, not $150M.

Here's how the progression typically works:

When you're at $1M to $2M in revenue, you need an outsourced bookkeeper handling your monthly close and building a basic cash flow forecast. Nothing fancy, just clean books and visibility into your cash position.

By $2M to $10M, you need a fractional CFO who can build a 13-week cash flow forecast, establish a KPI dashboard, and run your annual budgeting process. This is when AdaptCFO typically engages with growth-stage companies—we're a fractional CFO and accounting firm for startups in the US that helps build this foundation.

When you reach $10M to $50M, it's time for a full-time controller who can deliver a monthly close in under 15 days and maintain audit-ready financials year-round.

At $50M to $200M, you need a full CFO plus an FP&A team implementing SOX-ready controls and investor-grade reporting. By this stage, you should be operating as if you're already public.

And finally, at $200M and above when you're actually going public, you need a complete finance organization with quarterly guidance processes, public company controls, and the ability to file your 10-Q within days of quarter close.

The mistake is trying to jump from the $2M infrastructure directly to the $200M infrastructure in a single year. That never works.

Should You Go Public? A Simple Framework

Let's make this practical. Here are the core questions to ask yourself:

Do you have the revenue scale? If you're not at $200M in ARR, the answer is almost certainly "not yet." You might be an exception if you're in a hot category and growing extremely fast, but you're fighting an uphill battle.

Do you hit Rule of 40? Add your revenue growth percentage to your profit margin percentage. If that number is below 40, public investors will be skeptical. If it's above 50, you'll get premium valuations.

Can you show a path to profitability? If you're losing money, you need to prove you can reach profitability within 12 months of going public. The days of "we'll figure out profitability later" are over.

Are your financial controls public-ready? Can you close your books in 10 days? Are your internal controls SOX-ready? Have you had clean audits for at least two years? If not, you have 12 to 24 months of work ahead.

Are your KPIs consistent? Have you been reporting the same metrics with the same definitions for at least two years? Or do your metric definitions change every quarter to make performance look better? Public investors will demand consistency.

Is your leadership team ready? Can your CEO handle hostile analyst questions? Is your CFO experienced with public company reporting? Does your board have independent directors with public company experience?

Is your employee culture aligned? Have you explained to your team what changes when you go public? Are they ready for blackout periods, insider trading policies, and quarterly pressure?

Are market conditions favorable? Is the IPO window open for companies in your category? Are comparable companies trading at attractive valuations? Sometimes waiting six months for better market conditions is worth it.

Do you have competitive reasons to go public now? Will being public help you win enterprise deals? Do you need acquisition currency to consolidate your market? Or are these just nice-to-haves?

What's your strategic alternative? Could you stay private longer and potentially get acquired at a premium? Do you have access to private capital to fund growth without public markets?

Score yourself honestly on each dimension. If you can answer yes to eight or more of these questions, you're probably ready to start the IPO process. If you can only answer yes to five or fewer, you have significant work to do—or staying private might be the better path.

What Finance Leaders Wish They'd Known Earlier

Tobias has been through two SaaS IPOs and worked with multiple companies at various stages of growth. Here's what she wishes she could tell her younger self:

Always have a rainy day plan. Even in the best of times, you should run scenario models. "What if revenue growth slows by 20%? What if our biggest customer churns? What if we need to cut to breakeven in six months?" Don't wait for crisis to think through these scenarios.

"I think even in the best of times, you can get distracted and not think of doing this," Tobias says. "But we finance leaders should always have a rainy day plan. Even if your CEO or your board doesn't want to hear it, I think it's just a good thought exercise."

She recommends maintaining a "parking lot list" of investments you'd make if you overachieve on revenue or underspend on OpEx. Similarly, have a list of what you'd cut first, second, and third if you needed to extend runway fast.

When COVID hit in 2020, the companies that had already done this planning could act in days. The ones who hadn't? They spent weeks in emergency planning mode while their cash drained.

Don't chase metrics—fix the business. When your KPIs look bad, the temptation is to redefine the metrics. Resist this. "If you're seeing results in KPIs that are not favorable, ask yourself: Is this metric not relevant to my business, or is this metric showing that the business isn't doing as well as we'd like?" Tobias advises.

Curiosity is a competitive advantage. Tobias credits much of her success to simply being curious about how the entire business works—not just the finance function. "I've tried to do more than just be a finance person who's just understanding the numbers. Understand the business, understand the opportunities and challenges that my business partners face."

The best CFOs aren't just numbers people. They understand product, sales, engineering, and how all the pieces fit together.

Build processes early, even when it feels premature. Every CFO wishes they'd implemented better financial processes earlier. "When companies can focus even just a little bit as they mature on good processes—whether in sales ops, HR, finance, or legal—it really helps later," Tobias emphasizes.

At $5M in revenue, implementing SOX-ready controls feels like overkill. At $150M when you're preparing for IPO, it feels like a miracle you survived this long without them.

The Tools That Make Modern Finance Possible

One thing that's changed dramatically since Tobias started her career? The finance tech stack.

"It's fascinating because this is an area where there is just so much innovation," she says. "There's just always a new group saying that there's something different or new that we can do."

The good news for founders? You can now replicate an ERP system for a fraction of what it used to cost.

"For founders who have just raised $100K, you can sign up for QuickBooks and Stripe and an entry-level CRM product—a handful of different SaaS products—and you don't have to talk to a human. You can just go on the website and with your credit card set up basically a lower level, more slimmed down ERP."

When you're getting started, QuickBooks Online plus Stripe for payments plus a basic CRM like HubSpot or Pipedrive gets you 80% of what you need for maybe $500 per month total.

As you scale to $5M to $20M, you might add specialized tools—Mosaic or Jirav for FP&A, Bill.com for AP automation, Brex or Ramp for corporate cards with built-in expense management.

When you cross $50M and start thinking seriously about IPO, that's when you graduate to NetSuite, Workday, or Sage Intacct as your core ERP, surrounded by specialized point solutions for revenue recognition, tax compliance, and consolidated reporting.

And AI is just starting to transform all of this.

Tobias admits she hasn't yet deeply adopted AI-specific finance tools, but she's watching closely. "I think there's a ton of opportunity for automation in the finance space," she says, noting that she's been using ChatGPT for various tasks.

QuickBooks and other platforms are already embedding AI—using OCR technology to automatically extract data from bills, categorize transactions, and suggest journal entries. The next few years will likely see AI handling much of the routine work that junior accountants do today.

A Final Word: Do the Right Thing

At the end of our conversation, we asked Tobias to complete this sentence: "A CFO under pressure should always..."

Her answer, without hesitation: "Do the right thing."

It's deceptively simple advice, but it cuts to the heart of what finance leadership means.

When your CEO wants to book revenue early to hit a milestone, do the right thing.

When your board pressures you to inflate projections to support a higher valuation, do the right thing.

When you're tempted to change metric definitions to hide deteriorating performance, do the right thing.

The CFO's job isn't just to count money. It's to be the financial conscience of the company—the person who tells the truth about the numbers, even when that truth is uncomfortable.

This matters even more when you're public. Once you cross that threshold, thousands of investors are trusting you with their capital. Employees are building their financial futures on your stock price. Regulators are watching for any sign of deception.

"You have to have resilience and thick skin," Tobias says, reflecting on those dark quarters at NetSuite when growth stalled. "We finance professionals have to be able to deliver both good and bad news and have clear heads and know that these cycles always happen."

The CFOs who succeed in the long term? They're the ones who maintain their integrity through the boom times and the busts.

What's Your Next Step?

If you're running a SaaS company between $2M and $50M in revenue, you're in that critical window where the decisions you make about financial infrastructure will determine your exit options years from now.

You might not be IPO-ready today. But are you building the foundation that makes an IPO (or premium acquisition) possible in three to five years?

Here's what to do this week:

Calculate your Rule of 40 score. Take your year-over-year revenue growth percentage and add your profit margin (or subtract your loss percentage). Where do you stand?

Audit your KPI consistency. Pull up your last eight quarterly board decks. Are you calculating metrics the same way each time, or do definitions keep changing?

Stress test your cash position. Build a simple scenario model: What if revenue growth slowed 30%? How many months of runway would you have? What would you cut first?

Evaluate your finance team. Do you have the right level of finance leadership for your stage? If you're at $5M with just a bookkeeper, you're probably underinvested. If you're at $50M without a full-time CFO, you're creating risk.

Document your processes. Even if you're not thinking about IPO, start documenting your key financial processes—revenue recognition, month-end close, contract approvals. This discipline pays dividends whether you go public, get acquired, or just want to run a tighter ship.

The companies that ring the bell at the NYSE or NASDAQ? They didn't suddenly become IPO-ready. They built that readiness methodically over years, making smart investments in financial infrastructure long before they needed it.

Your exit might be five years away. But the work starts today.

FAQ

Can a SaaS company go public with less than $200M in revenue?

Technically yes, but it's increasingly rare post-2020. Public investors prefer mature, profitable companies with proven business models at scale. If you're growing 100%+ year-over-year with a clear path to $200M within 18 months of going public, some underwriters might take you. But you'll face more scrutiny and potentially lower valuations than if you waited to build more scale.

How much does it cost to prepare for an IPO?

Expect $3M to $10M in direct costs including legal fees, auditing, underwriting fees, and public relations. But the bigger cost is opportunity cost—18 to 36 months of executive time and internal resources dedicated to IPO preparation. You'll need to hire specialized roles like an Investor Relations lead, upgrade your finance team, and implement new systems and controls. Budget accordingly.

What's the difference between going public in 2007 vs. 2024?

In 2007, high-growth companies could go public earlier with less profitability. NetSuite went public before hitting $100M in revenue. Today, investors demand Rule of 40 performance and proven unit economics before IPO. The market has matured and expectations have risen significantly. You need to show both growth and profitability, not just growth alone.

Do I need a full-time CFO before going public?

Absolutely. A fractional CFO can help you build toward IPO readiness in the $2M to $50M stage, but you need a full-time, experienced public-company CFO at least 18 months before going public. That CFO needs direct experience with SEC reporting, investor relations, and public company governance. This isn't the time to hire someone learning on the job.

What happens if we go public and then revenue growth slows?

Your stock price will suffer, potentially dramatically. You'll face intense scrutiny from analysts and investors who will question your business model, competitive position, and management competence. This is why scenario planning and having a "rainy day plan" is critical—even in good times. The companies that weather public market turbulence are those who planned for it.

How do we know if staying private is better than going public?

If you value long-term strategic flexibility, want to avoid quarterly earnings pressure, and can access growth capital privately (through venture funding, private equity, or revenue-based financing), staying private may be smarter. Ask yourself: Do we need public markets for capital, liquidity, or strategic reasons? Or are we going public because we feel like we're "supposed to"? Only go public if it serves your strategic objectives.

What role does a fractional CFO play in IPO readiness?

A fractional CFO can build the financial foundation early in the $2M to $50M stage—implementing KPI tracking, establishing FP&A processes, building audit-ready financials, and preparing for your first external audits. Then they can help you transition to hiring a full-time CFO when you approach $50M+ revenue and are 2 to 3 years from potential IPO. Think of fractional CFO as building the foundation; full-time CFO as building the structure.

What's the number one thing CFOs wish they'd done earlier before IPO?

Built financial processes and controls early—especially SOX-ready internal controls and consistent KPI definitions. Every CFO who's been through an IPO has a story about scrambling to document processes or clean up historical financials under time pressure. The ones who succeed started that work years before it was required, when they had time to do it right.

Is your company on the path to IPO, acquisition, or sustained growth?

Whether you're at $2M or $200M in revenue, the financial decisions you make today determine your exit options tomorrow. AdaptCFO helps growth-stage companies build the financial infrastructure, KPI discipline, and strategic planning that makes IPOs, acquisitions, and fundraising rounds smoother—and more valuable.

Work with us if: You're raising a Series A or beyond, scaling revenue fast, or preparing for a major financing or exit event in the next 12 to 24 months.

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