A San Jose cybersecurity SaaS with $3.2M ARR was approaching its Series B without a bottoms-up financial model. We built it. The $28M round closed at a $94M valuation.
01The Situation
The founders had built a genuinely differentiated cybersecurity product for mid-market companies. Product was excellent. NRR was 108%. But every Series B meeting ended the same way: investors liked the product, liked the numbers, and then asked how the company would get from $3.2M to $20M ARR. The founders answered in PowerPoint. Investors wanted a model.
The CFO search was taking longer than expected. They needed the financial model before they ran out of time in the raise window.
02What We Did
We built the model from customer data up: cohort analysis showing retention by segment, sales capacity modeling showing AEs needed to hit each ARR milestone, and a marketing-to-pipeline conversion model showing exactly what inputs drove new ARR. Every assumption was visible and investor-testable.
The base case output: $12.8M ARR by year 3, assuming 8 AEs at full productivity, 80% pipeline conversion, and current NRR trend holding. The Series B lead said it was one of the most clearly constructed growth models they had reviewed at this stage.
03Client Impact
The founders had the right product and the right numbers. What was missing was the story those numbers told when organized correctly. The process of building the model clarified their own thinking about how to deploy the Series B capital.
Breakdown
| Metric | FY 2024 (Actual) | FY 2025 (Base) | FY 2026 (Base) | FY 2027 (Base) |
|---|---|---|---|---|
| ARR | $3.2M | $5.4M | $8.6M | $12.8M |
| Net New ARR | $1.1M | $2.2M | $3.2M | $4.2M |
| Gross Margin | 74% | 76% | 78% | 80% |
| Net Rev. Retention | 108% | 112% | 114% | 116% |
| Implied Valuation (4x) | $12.8M | $21.6M | $34.4M | $51.2M |
What changed
Bottoms-Up ARR Model Built
Customer cohort analysis, sales capacity model, marketing conversion model. Every assumption documented.
Series B Closed, $28M at $94M Valuation
Lead investor cited financial model clarity as differentiating factor in a competitive round.
3-Year Roadmap to $12.8M ARR
Base case: 8 AEs, 80% conversion, current NRR trend. All inputs investor-testable.
Fractional CFO Retained Post-Close
Founders retained us to manage board reporting and investor relations.
The founders had the right product and the right numbers. What was missing was the story those numbers told when organized correctly. The process of building the model clarified their own thinking about how to deploy the Series B capital.
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