Software-as-a-service (SaaS) has emerged as one of the most profitable and prominent investment categories in venture capital (VC). In 2023, deal value for enterprise SaaS totaled $72.9 billion—a 33% year-over-year decline but a significant increase compared to the pre-2021 peak of $58.3 billion in 2020.
SaaS has also consistently captured a growing share of venture investment over the last six years, with 47% of venture investment going to SaaS startups in 2023, up from 30% in 2017.
In this article, we'll explore the top seven firms investing in SaaS based on Dealroom’s SaaS investor ranking, which ranks VC firms by the number of B2B SaaS deals they have invested in over the last five years. We’ll also take a look at what differentiates leading VC firms.
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1. Tiger Global Management
Tiger Global Management is a New York-based investment firm that invests in public and private companies in the internet, software, consumer, and fintech sectors. With a reputation for backing some of the world's most innovative companies, Tiger Global Management has an impressive track record of 90+ portfolio company IPOs and 140 exits—including SaaS names such as Palantir and Procore.
When it comes to their investment ethos, Tiger Global Management says,
“With a strong track record investing across sectors and stages, Tiger Global aims to be a thought partner to companies and their management teams across their lifecycle in public and private markets. The Firm’s mission is to generate world-class returns for its investors and to do so in a way that makes its employees, partners and portfolio companies proud.”
2. Insight Partners
Insight Partners has focused on software since the firm’s inception in 1995. The firm has over $80 billion in AUM, investing in high-growth tech, software, and internet startups across every venture stage. Insight Partners has a track record of 55+ portfolio company IPOs, and the firm has exited prominent SaaS names like DocuSign and Shopify.
When it comes to their experience in software, they say,
“In 1995, we bet on our hunch that software would change the game. We’ve since partnered with hundreds of executives who’ve transformed and shaped industries, changing the way people live and do business. Insight’s approach is straightforward and results-driven. We deploy our three core pillars – scale, focus, and experience – to help companies capture value and generate long-term business success.”
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3. Sequoia Capital
Sequoia Capital has a portfolio of almost 2,000 companies and has invested in top-notch SaaS companies such as Dropbox, Loom, Notion, Zoom, and Drift. Headquartered in Menlo Park, California, the firm is renowned for investing in innovative startups in various sectors, including finance, energy, healthcare, and the internet.
What types of founders is Sequoia on the lookout for? They say,
“The creative spirits. The underdogs. The resolute. The determined. The indefatigable. The outsiders. The defiant. The independent thinkers. The fighters and the true believers. These are the founders with whom we partner. They’re extremely rare. And we’re ecstatic when we find them.”
4. Accel
Accel Partners has a track record of stellar SaaS investments, backing companies such as DocuSign, Dropbox, and Slack. Known for their commitment to supporting teams at very early stages in their journeys, Accel has been the initiating or lead investor in more than 70% of its portfolio companies over the past decade. Accel says:
“Our primary objective is to be the very first investor in our companies, take active, constructive roles with founders, and work patiently side-by-side to build incredible businesses. No short cuts. No company is too early and no check is too small.”
5. Andreessen Horowitz (a16z)
Founded by Marc Andreessen and Ben Horowitz in 2009, Andreessen Horowitz provides startups with access to expertise in innovation, executive and technical talent acquisition, market intelligence, policy and regulatory affairs, business development, and marketing and brand-building. Andreessen Horowitz invests across a wide range of sectors including AI, bio + healthcare, consumer crypto, enterprise, and fintech.
With $42 billion in AUM, the firm is stage-agnostic and has invested in SaaS companies like Asana, Coinbase, and GitHub. For SaaS enthusiasts, Andreessen Horowitz’s blog is worth bookmarking—their deal partners frequently discuss the latest SaaS trends, as well as predictions for the future.
A core belief at Andreessen Horowitz revolves around respect for founders. They say,
“Respect for the entrepreneur and the company-building process defines a16z. We know what it’s like to be in the founder’s shoes. General partners lead the firm, many of whom are former founders/operators, CEOs, or CTOs of successful technology companies, and have domain expertise ranging from data to artificial intelligence, biology to crypto, distributed systems to security, and marketplaces to financial services.”
6. Lightspeed Venture Partners
Founded in 2000, Lightspeed Venture Partners is a global VC firm with over 1,350 investments and 28 funds. The firm invests in companies across stages and in sectors including consumer, enterprise, and technology.
According to Alex Taussig, a Partner at Lightspeed Venture Partners, the most successful venture capitalists are experts at embracing constructive conflict and building deep, meaningful relationships. He says, "Conflict, when healthy, is a feature, not a bug."
7. Antler
Antler is a Singapore-based VC firm that invests primarily in early-stage startups around the world. They are one of the most active early-stage investors, having invested in over 1,000 startups since their founding in 2018—with a goal to back more than 6,000 startups by 2030.
In 2023, Antler launched a $285 million fund for later-stage investing. Magnus Grimeland, Antler’s founder and CEO, explains how the fund fits into the firm’s strategy,
“What we realized is, to be a great partner to the best founders it’s important to be with them for the long term, right? If we can say to incredible founders when they’re coming in, that we will not only be there to back you in the first round, but we’re also there to back you in the second round, in the third round and the fourth round… that means a lot, knowing that your first investor is still on board.”
What differentiates top venture capital firms
What helps top firms stay ahead? Our 2024 investment benchmark report researched the activities of top venture capital firms that use Affinity and revealed three key characteristics of top VCs:
- Regular communication: Leading VCs consistently generated more engagement, sending and receiving 30% more emails than other firms in Q4 2023.
- Network depth: Top firms prioritized their existing network in 2023, adding fewer new contacts to their networks, while other firms consistently grew their network throughout the year.
- Data-driven decisions: Compared to their peers, leading VCs are much more likely to analyze more data sources; with 58% of surveyed firms using seven or more data sources to evaluate deals.
To understand the dealmaking strategies of leading VC firms, view our 2024 investment benchmark report. It includes exclusive data on how top VCs outperformed the market last year and how you can use relationship intelligence to gain a competitive edge.
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