B2B SaaS
TLDR
Software delivered as a subscription service sold to businesses rather than consumers.
Definition
Business-to-business Software as a Service is a delivery model in which software runs on the provider's infrastructure and is licensed per seat, per usage, or per feature tier. Customers pay recurring fees instead of buying a perpetual license. The provider handles hosting, upgrades, and security; the customer accesses the product through a browser or API.
Why it matters
B2B SaaS became the default model for enterprise software over the 2010s because it lowered the cost of adoption, reduced the friction of procurement, and gave vendors a direct relationship with users. Recurring revenue made valuations more predictable and enabled venture-scale growth. Most Belgian tech companies in the HR Tech and Fintech sectors follow this model, including TechWolf, Showpad, Deliverect, and Silverfin.
Mechanism
Revenue compounds because each new customer adds to an existing base that churns at a lower rate than it grows. Key metrics: ARR (annual recurring revenue), net revenue retention, CAC payback period, gross margin. Growth efficiency is measured as magic number or Rule of 40.
Related
- Parent: SaaS (software as a service)
- Child: Vertical SaaS - SaaS targeted at a single industry
- Sibling: Open Core - commercial SaaS built on open-source core
- Sibling: Product-Led Growth - acquisition strategy common to B2B SaaS