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Research Partners
Presenting Sponsor
Strategic Partner
Strategic Partner
Top Findings
GTM Efficiency Has Inflected
- 11% CAC Payback Period | Magic Number > 1.0 | Blended CAC Ratio: $1.30
Driven by GTM rationalization, not spending volume. Blended CAC Ratio improved to $1.30. The efficiency is real; the question the rest of the report answers is whether it is durable.
1
Human Capital Efficiency Has Structurally Reset
$175K median ARR/employee | +17% YoY
R&D fell 8 points to 27% of revenue. Top quartile reached 22% R&D, achievable
only through AI productivity.
3
Rule of 40 Posts Largest Single-Year Gain in 5 Years
15% → 25% median | Top quartile reaches 43%
Subscription + Usage models lead the cohort at 43% (75th percentile), validating
hybrid pricing.
2
Software Gross Margin Held the Line at 80%+
80% median software margin | Stable through 4 years
Industry-wide AI infrastructure costs have not yet compressed software margin at the median.
4
Retention Is Deteriorating Market-Wide
GRR: 88% → 84% | 75th percentile: 95% → 91%
A market-level structural dynamic, not company-level execution. Top performers
were not immune.
5
Expansion Dependency Is Rising
40% of Net New ARR from expansion at median | 44% in low-growth cohort
When expansion crosses 40%, it signals substitution for new logo growth, not
amplification of it.
7
Pricing Model Is a Structural Determinant of NRR
Usage 108% vs. Seat 98% | 10 percent gap
Pricing architecture is not a neutral commercial choice. It determines whether
revenue compounds or decays.
6
The Median Is No Longer Safe
3.4x Magic Number spread | 3.2x ARR/employee spread
The distance between the 75th and 25th percentile is larger than most companies can close in a single planning cycle. Hitting the median in 2H-26 and 2027 is not a target; it is the leading edge of the risk zone.