In a challenging COVID-19 environment, the performance of Polen’s Software-as-a-Service (SaaS) holdings has led the firm to question whether these companies may offer the benefits of typical recession-resistant businesses but with potentially more sustainable growth.
- The traditional software business model has significantly evolved toward a SaaS model, which, for some companies, has resulted in stronger business economics and resiliency.
- A transition to the SaaS model can potentially unlock significant value for a business by addressing the shortcomings of the traditional software model, reducing costs, establishing a recurring revenue stream, and providing more pricing power.
- Pursuing a SaaS model is a complex process and demands significant upfront investment, but if successful, can result in higher margins and more consistent revenues.
- In an accelerated digital-first environment, we believe software companies have become even more mission critical to their customers both professionally and personally.
Montgomery offers investors access to a concentrated portfolio of outstanding global businesses through the Polen Capital Global Growth Fund. You can read more about the fund here: Polen Global Growth