Bookings are a very important SaaS metric used for measuring the total value of customer contracts or agreements within a given period. It accounts for the total dollar value that a company expects to receive from the customer over the lifetime of their subscription or contract.
There are different methods to calculate this metric, with the most common being the subscription every month. For example, if a customer agrees to a 12-month $6,000 subscription starting in April, booking would be $5,005 of revenue recorded monthly from April to the month of March the following year
ƒ Sum(Total Value of Signed Contracts)
Booking is an important factor in judging the growth of a company. A 200% YoY growth in the booking is seen as a benchmark for a company in the pre-seed and seed stage, while a 100% growth in the latter stages is considered healthy.
Annual Contract Value
Monthly Recurring Value
Bookings help in tracking revenue growth and predicting future cash flows. It lets SaaS companies make informed decisions about investments, sales targets, and staffing.
Bookings represent the total value of customer contracts or agreements that a SaaS company expects to receive from a customer. In contrast, revenue represents the actual amount of money received from customers.