# Rule of 40 for SaaS: What It Is and How to Calculate It

DevFeed: [Rule of 40 for SaaS: What It Is and How to Calculate It](<https://devfeed.tech/articles/rule-of-40-for-saas-what-it-is-and-how-to-calculate-it-10321.md>)

Original publisher: [Read original article](<https://dodopayments.com/blogs/rule-of-40-saas/>)

Author: Ayush Agarwal

Published: 2026-04-12T00:00:00Z

Content type: tutorial

Language: en

Sources: [Dodo Payments Blog](<https://devfeed.tech/sources/dodo-payments-blog.md>)

Topics: [Software as a service](<https://devfeed.tech/topics/saas.md>), [Benchmark](<https://devfeed.tech/topics/benchmark.md>), [Finance](<https://devfeed.tech/topics/finance.md>)

Tags: [benchmark](<https://devfeed.tech/tags/benchmark.md>), [growth](<https://devfeed.tech/tags/growth.md>), [margin](<https://devfeed.tech/tags/margin.md>), [metrics](<https://devfeed.tech/tags/metrics.md>), [saas](<https://devfeed.tech/tags/saas.md>), [saas-finance](<https://devfeed.tech/tags/saas-finance.md>), [saas-metrics](<https://devfeed.tech/tags/saas-metrics.md>)

## AI overview

This article explains the Rule of 40 for SaaS, a benchmark calculated by adding revenue growth and profit margin. It describes how founders and investors use the metric to assess the balance between growth and profitability, while noting that it should not replace deeper analysis.

## Source excerpt

Learn what the Rule of 40 for SaaS means, how to calculate it, and how founders can improve the balance between growth and profitability.