Your SaaS P&L Might be Wrong

Most SaaS founders don’t understand their P&L.

They see high margins and think they’re killing it.

But if you’re scaling past $10M ARR and still reporting 90%+ margins…

Something is wrong.

Here’s what accurate SaaS P&L structure looks like:

✅ Revenue – Recurring, service, and other income streams
✅ COGS – Hosting, third-party tools, customer support salaries
✅ OpEx – R&D, sales, marketing, admin costs

When you misclassify expenses, everything else breaks:

🚩 Burn Rate seems artificially low
🚩 CAC looks better than it actually is
🚩 Rule of 40 gives a misleading picture

If your SaaS company is reporting unrealistically high margins, investors will catch it.

Get your P&L right…or risk making decisions based on bad data.