The public software market is in a recession. At the same time, PLG is also at the top of the Gartner Hype Cycle.  

What is interesting is to look at companies that are in the Variance Public PLG Index (43) versus their public market peers that are not PLG (64). As a reminder, what makes a company PLG: 

  • Must allow for a frictionless signup experience (eg. a user can sign up on the website without talking to sales)
  • Must offer transparent pricing (eg. at least one of their pricing stages gives a price, even if the enterprise edition might say something like, contact sales)


Median PLG company market cap: $6.7B. 

Median Non-PLG company market cap: $4.2B. 

Revenue Multiple

Median PLG company Enterprise Value (EV) / Next Twelve Months (NTM) Revenue: 6.1x. 

Median Non-PLG company Enterprise Value (EV) / Next Twelve Months (NTM) Revenue: 6.1x. 

Revenue Growth

Median PLG company Revenue Growth: 35%. 

Median Non-PLG company Revenue Growth: 24%. 

The data speaks to an interesting market dynamic. 

  • PLG companies have a 37% higher market cap than their Non-PLG peers. 
  • PLG companies have the exact same revenue multiple at 6.1x their next twelve months of forecasted revenue as their Non-PLG peers. 
  • PLG companies are growing revenue 32% faster than their Non-PLG peers. 

In other words, PLG companies are bigger and growing faster, but their revenue multiple is the same as their Non-PLG peers. Why is the market discounting PLG companies? Is that how you would value PLG companies versus Non-PLG companies at a time like this? 

Curious on your thoughts. 

Try the Variance customer growth platform

Join some of the world's top software companies that use Variance to power data-driven sales.
Get Started 🎉

Subscribe to Variance News

An inside look at building a company delivered in (roughly) bi-monthly installments

Thanks for signing up.
Look out for our newsletter!
Oops! Something went wrong while submitting the form.

Get to know Variance

We believe the best way to learn about a product is to read the documentation. Have a look around.

Explore our Docs