# Cloudsmith Financial Model Cloud-native software supply chain management platform - secure, managed package distribution for engineering teams. - Canonical: https://finamodel.com/startups/cloudsmith - Excel download: https://finamodel.com/startup-models/cloudsmith.xlsx - Category: Logistics/Mobility - Model type: SaaS ARR / Valuation - Funding round: Series A - Funding: $15M - Founded: 2024 - Geography: HQ Belfast (Northern Ireland); targeting North America, Europe, Australia [DECK slide 16]. - Customer: B2B ## About the company Cloudsmith is cloud-native software supply-chain management for secure package distribution. Engineering teams use it to manage dependencies and software artifacts across their delivery workflows. The core revenue build should start with customer organisations, developer seats, and usage. Subscription ARR should distinguish new customers from expansion within existing engineering teams. Forecast churn alongside cloud-storage and support cost, since both can rise with adoption and software-artifact volume. The resulting model connects secure distribution demand to recurring revenue and gross margin. It should make clear how managing dependencies differs from managing the software artifacts distributed through delivery workflows and across engineering teams worldwide. ## What's included - 5-year monthly revenue build with stage-appropriate growth assumptions - Full P&L, headcount plan, and operating-expense schedule - Cash-flow statement, runway, and burn-rate tracking - Valuation via exit multiple with a DCF cross-check - Returns analysis with MOIC and IRR - Unit economics including CAC, LTV, payback, and cohort retention ## Product & value proposition - Managed Package Distribution Network (PDN): a "smart CDN" for software artifacts - ingests packages from developers and upstream sources, enforces controls and security scanning, distributes to internal teams and external consumers. - Supports 23+ package formats (Docker, Maven, Ruby Gems, npm, Python, etc.). - Three core pillars: Observability, Control, Performance. - Ecosystem integrations: CI/CD (CircleCI, Buildkite, GitHub), security scanning (Clair, Trivy, Snyk, Anchore), observability (Datadog, SumoLogic, New Relic), deployment (Terraform, Harness, Puppet). - Future vision ("The Mesh"): deep learning layer mapping the global software bill of materials - software intelligence across all interconnected supply chains. - 99.99%+ uptime SLA (past 3 months at time of deck). ## Market - TAM: $500 billion - "All Software Companies". Note: this appears to be a broad total software market figure; treat as aspirational context, not serviceable market. - SOM (labelled as "Service Obtainable Market"): $100 billion - companies with R&D >50 devs, portfolio of products, distributing at scale. - ICP (labelled as "Ideal Customer Profile" market): $50 billion. Footnote references JFrog with 1% capture of a (partially overlapping) $22bn addressable market, of which only 23% is cloud-based. - Growth context: "By 2023, 40% of orgs will ship code daily vs. 3% in 2019". Market is shifting to Cloud-Native / DevOps - structural tailwind for cloud-based package management. - Competitive reference: JFrog cited as having 0.5% capture of $50bn addressable market, with only 23% cloud-based - implies huge whitespace in cloud-native segment. ## Revenue model Three-tier subscription model with usage-based overlay: | Tier | Channel | ASP Multiplier | | -- | -- | -- | | Team (self-serve) | Inbound / PLG | 1x (base) | | Velocity (self-serve) | Inbound / PLG | 3x | | Ultra (mid-market ICP) | ABM + sales | 20x | | Enterprise | Strategic sales | 39x | - Usage component (storage + bandwidth) sits on top of every tier; capped at Team and Velocity tiers to drive upgrade pressure. - Usage can be pre-purchased at a discount (pre-purchased usage) or consumed on-demand. - Revenue streams: Subscription ARR + On-Demand Usage ARR + Pre-Purchased Usage. - Target mid-market ACV sweet spot: $100–150k. - GTM: Self-serve (content/inbound) for Team/Velocity; high-touch ABM + pre-sales/CS for Ultra/Enterprise. - Distribution costs scale at 5–10x revenue margin (i.e., COGS are a fraction of revenue at scale). ## Traction & metrics - ARR: $REDACTED (end of May 2021); footnote mentions "$REDACTED ARR in April, and ~$REDACTED+ in June". All dollar figures redacted in deck. - ARR growth: 3x YoY in 2020; 10% MoM (at time of deck, mid-2021). - Customers: REDACTED (number redacted across all slides). - NPS: REDACTED. - Average rating: REDACTED. - Net Revenue Retention (NRR): REDACTED%. Cohort table (slide 35) shows all NRR values as "XXX%" but the scatter plot shows NRR at 12 months rising to ~165–170% for early cohorts - strong net expansion trajectory visible in chart shape. - Service requests: 0.5 billion in past 3 months. - Uptime: 99.99%+ (past 3 months). - Total sessions: REDACTED (past 1 month). - ARR mix by tier (end Apr 2021): Ultra = 59% of ARR, Velocity self-serve = 23%, Team self-serve = 18%. - Shopify case study: initial deal size and expected Y1 growth both redacted. - CAC (Ultra net new): $REDACTED. - LTV: $REDACTED. - Payback period: "X months" (redacted). - Ultra ACV: $REDACTED. ## Unit economics - CAC (Ultra net new customers): REDACTED. - LTV: REDACTED. - Payback period: REDACTED. - Gross margin (current): ~XX% (redacted in slide 36 image). Deck states target of 80%+ gross margin achievable short-term with ARR scale; long-term target 85%+. - COGS structure: Payroll COGS + Non-Payroll COGS (infrastructure). Infrastructure costs described as "relatively flat - doesn't need to scale with customers." Distribution costs scale at 5–10x revenue margin. - Ongoing AWS discounts and infrastructure optimisation (spot instances, reserved capacity, serverless migration) expected to compress non-payroll COGS over time. ## Competition / moat Competitors: - On-premises / traditional: JFrog Artifactory, Sonatype Nexus, Inedo ProGet - Cloud commodity storage: GitHub, GitLab, DockerHub - Cloud platform providers: AWS CodeArtifact, Azure DevOps, Google Cloud Platform - Specialist cloud: PackageCloud, MyGet, GemFury Cloudsmith positioning: Best-in-breed + Cloud-Native (upper-right quadrant - only occupant) vs. all competitors who are either on-premises or platform/generalist. Moat claims: - Fully managed global infrastructure (competitors require self-hosted/self-managed) - 23+ format support vs. single-format or limited tools - Deep security and compliance stack (license compliance, scanning) - Upstream caching and isolation - First-mover in Cloud-Native SSC - "The Mesh" as durable future differentiator - NPS / customer love cited as differentiated vs. JFrog ## Team & funding ask / use of funds Co-founders: - Alan Carson, CEO - 20+ years enterprise software; led NYSE international team deploying 100+ products. - Lee Skillen, CTO - 20 years high-performance computing and security; built Newzbin (120k subscribers, 200M hits/month, £1.2M ARR). Core team (~12 people at time of deck): Engineering (3), Developer Relations (2), Marketing (4 inc. Director), Chief of Staff. Board: Steve Collins (ex-CTO King, Swrve, Havok). Advisors: Sarah Friar (CEO Nextdoor, ex-Square), Michael Black (CFO Clavis, Ammeon). Existing investors: Frontline, MMC, Techstart. Raising: Series A (amount not disclosed in deck). Use of funds - proportional spend: - Sales & Marketing: 54% - R&D: 32% - Customer Success: 9% - Admin: remainder Key senior hires planned: CRO/VP Growth, VP Engineering, VP Product, VP Security, Head of Customer Success, Head of Talent. --- ## Recommended financial model - **Archetype + why:** SaaS ARR model with usage-based overlay ("SaaS + consumption" hybrid). Revenue has two distinct components - recurring subscription by tier and variable usage (storage + bandwidth). The tier structure (Team/Velocity/Ultra/Enterprise) with explicit ASP multipliers maps cleanly to a cohort-based ARR build. NRR well above 100% (cohort chart implies ~130–170% at 12 months for mature cohorts) means net expansion is the primary growth lever alongside new logo adds. This is a classic product-led + sales-assisted SaaS motion with a usage flywheel. - **Forecast horizon & granularity:** Monthly for Years 1–2 (2021–2022), quarterly for Years 3–4 (2023–2024). Four-year horizon aligns with deck's own forecast slide. Monthly granularity needed to model 10% MoM growth trajectory and usage seasonality. - **Key drivers & assumptions:** *New logo acquisition* - Starting customer count: REDACTED - New logos per month by tier: - PLG conversion rate (free/trial → paid Team): - Sales cycle length: *ACV by tier* - Team ACV: - Velocity ACV: - Ultra ACV:] - Enterprise ACV: *Usage revenue* - Usage as % of subscription ARR by tier: - Usage growth per cohort: *Net Revenue Retention* - NRR: REDACTED. Cohort chart implies >130% at 12 months for mature cohorts - - Gross churn:; model at 3–5%] *Gross margin* - Current gross margin: ~XX% (redacted). Deck states short-term target 80%+, long-term 85%+ - - Non-payroll COGS: - Payroll COGS: *Headcount & Opex* - Use of funds split: 54% S&M, 32% R&D, 9% CS, ~5% Admin - - Sales rep productivity: *ARR growth rate* - Base case: 3x YoY 2021→2022 (consistent with 2020 performance) then decelerating: ~2.5x 2022→2023, ~2x 2023→2024 - 10% MoM in 2021 = ~214% annual growth - use as anchor for near-term - **Scenarios (Base / Bull / Bear - which variables flex):** - Bear: NRR drops to 105–110% (usage expansion stalls), new logo adds 30% below plan, GM stays at ~65% (infrastructure not optimised). Implies ~2x YoY. - Base: NRR 120–130%, new logos per plan, GM expansion to 80% by 2022. Implies 2.5–3x YoY for 2021–2022. - Bull: NRR 140%+ (Mesh/intelligence upsell kicks in), enterprise logo wins accelerate (ACV >$150k), GM hits 85% by 2023. Implies 3x+ sustained into 2023. - **Required sheets / outputs:** 1. **Assumptions** - all drivers, toggle for Base/Bull/Bear 2. **ARR Build** - new ARR, expansion ARR, churned ARR by tier and month; opening/closing ARR waterfall 3. **Usage Revenue** - on-demand usage and pre-purchased usage layers by tier 4. **Cohort Model** - customer cohorts by quarter, track NRR expansion over 12 months (mirrors slide 35 structure) 5. **Headcount Plan** - by department, with hire dates and fully-loaded cost 6. **P&L** - monthly IS: Revenue (subscription + usage), COGS (payroll + infra), Gross Profit, S&M, R&D, G&A, EBITDA 7. **Gross Margin Bridge** - current state → short-term target → long-term (infra optimisation waterfall) 8. **Unit Economics** - CAC by tier, LTV, payback period; LTV/CAC ratio 9. **Summary Dashboard** - ARR, Customers, NRR, GM%, Burn, Runway KPIs ## Frequently asked questions ### Is the Cloudsmith financial model free? Yes. The Cloudsmith model is a free Excel download with live formulas. ### Can I change the assumptions? Yes. The workbook is editable and its live formulas recalculate when assumptions change.