SaaS & Software Company ERP | Best ERP for Tech Companies 2026

The SaaS and Software Company ERP Buyer's Guide

Software and SaaS companies have fundamentally different ERP needs than traditional businesses. Your revenue model is built on subscriptions, not one-time transactions. Your biggest asset is intellectual property, not physical inventory. And the accounting standards governing your financial statements (ASC 606, ASC 350-40, ASC 340-40) are among the most complex in any industry.

Generic ERP systems were not designed for this. They were built for companies that buy materials, make products, and ship them to customers. When a SaaS company tries to shoehorn subscription billing, multi-element revenue arrangements, and deferred revenue schedules into a system designed for manufacturing or distribution, the result is a mess of spreadsheets alongside an expensive ERP that handles only half the job.

Whether you are a Series A startup outgrowing QuickBooks, a growth-stage company preparing for an audit, or a pre-IPO SaaS business building the financial infrastructure for public markets, the right ERP is critical. It determines whether your finance team spends their time on strategic analysis or on manual revenue recognition calculations in Excel.

This guide covers the ERP landscape specifically for software and SaaS companies. We explain the unique requirements, compare vendors at different stages, and give you honest assessments of what works and what does not.

Why Software and SaaS Companies Have Unique ERP Needs

The challenges below are not edge cases. They are the daily reality of SaaS finance, and they are exactly where generic ERP systems fall short.

ASC 606 Revenue Recognition for Multi-Element Arrangements

This is the single most complex accounting challenge in SaaS. When you sell a deal that includes a software subscription, implementation services, training, and premium support, ASC 606 requires you to identify separate performance obligations, determine standalone selling prices for each, allocate the total transaction price across them, and recognize revenue as each obligation is satisfied.

If you are doing this in spreadsheets, you know the pain. Every contract modification, every mid-term upgrade, every renewal with changed terms requires recalculation. The error rate in manual ASC 606 calculations is staggering, and audit firms are increasingly scrutinizing revenue recognition as a critical audit area.

Subscription Billing Complexity

Your billing engine needs to handle monthly and annual subscriptions, mid-term upgrades and downgrades (with prorated adjustments), seat-based pricing with variable quantities, usage-based billing components, free trials that convert to paid, co-termination of multiple subscriptions, automatic renewals with price escalations, and credits and refunds. Most ERP billing modules were designed for invoice-and-pay workflows, not the dynamic, recurring complexity of SaaS billing.

SaaS Metrics That Investors and Boards Demand

Your board deck requires ARR, MRR, net revenue retention, gross churn, logo churn, CAC payback period, LTV/CAC ratio, and expansion revenue breakdown. These metrics need to be calculated from your source financial data, not estimated in a separate spreadsheet. When your CFO presents numbers to the board, the ARR figure needs to tie to the revenue figure in the general ledger. If they come from different systems with different assumptions, you have a credibility problem.

R&D Cost Capitalization (ASC 350-40)

Software companies must determine which development costs to capitalize and which to expense. Under ASC 350-40, costs incurred during the application development stage for internal-use software are capitalized, while preliminary project costs and post-implementation costs are expensed. For SaaS companies, this means tracking developer time against specific projects and capitalizing the right portion. Most companies do this in spreadsheets, but at scale it requires system support that ties engineering time tracking to the general ledger.

Deferred Revenue Management

In SaaS, cash collection often precedes revenue recognition by months or even years. When a customer pays $120K upfront for an annual subscription, you recognize $10K per month and carry $110K in deferred revenue on day one. Managing deferred revenue schedules across thousands of customers, each with different contract terms, renewal dates, and billing frequencies, is a core ERP requirement that generic systems handle poorly.

Multi-Entity and Intercompany for Global Operations

SaaS companies scale globally faster than traditional businesses because there is no physical product to ship. By the time you hit $20M ARR, you likely have entities in multiple countries for tax optimization, local employment, and data residency compliance. Intercompany transactions (management fees, IP licensing, cost-sharing arrangements) must be automated and eliminated in consolidation. Transfer pricing documentation adds another layer of complexity.

Commission Management (ASC 340-40)

ASC 340-40 requires you to capitalize and amortize sales commission costs over the expected customer relationship period, not expense them when paid. For a SaaS company with a large sales team, this creates a significant deferred commission asset that must be tracked at the individual contract level. The commission calculation itself is already complex (accelerators, SPIFs, multi-year deal bonuses, clawbacks), and the accounting treatment adds another layer.

IPO and Audit Readiness

If you are on the path to going public or being acquired, your financial systems need to withstand audit scrutiny. This means robust audit trails, segregation of duties, SOX-compliant controls, and the ability to produce financial statements that meet SEC reporting requirements. Building this infrastructure retroactively is far more expensive and disruptive than doing it right from the start.

Professional Services Revenue Alongside Subscription

Many SaaS companies have a meaningful professional services business (implementation, customization, training, managed services) alongside their subscription revenue. These two revenue streams have different recognition patterns, different margin profiles, and different operational workflows. Your ERP needs to handle both cleanly, with proper cost allocation and separate margin reporting.

Best ERP Systems for Growth-Stage SaaS ($5M-$100M ARR)

This is the sweet spot where ERP selection matters most. You have outgrown QuickBooks, you are likely facing your first serious audit, and you need systems that can support the next 3-5 years of growth. The wrong choice here costs you 12-18 months and hundreds of thousands of dollars in a failed implementation.

Sage Intacct

Best for: SaaS companies that prioritize financial management depth and ASC 606 compliance

Sage Intacct has become the dominant ERP for mid-market SaaS companies, and the dominance is earned. Its multi-dimensional general ledger lets you tag every transaction with dimensions (product line, customer segment, geography, sales rep) and report on any combination without restructuring your chart of accounts. For a SaaS CFO who needs to slice ARR by cohort, segment, and product, this is transformative.

The ASC 606 revenue recognition module is the most mature in this price range. It handles multi-element arrangements, standalone selling price allocation, variable consideration, and contract modifications natively. Revenue schedules are generated automatically and tie directly to the GL. The deferred revenue waterfall reports that auditors request are available out of the box.

Multi-entity consolidation is another strength. Intercompany transactions, currency translation, and minority interest eliminations are automated. For SaaS companies with 3-10 entities, Intacct handles this better than competitors twice its price.

The limitation is that Intacct is a financial management platform, not a billing system. For subscription billing, you will need a separate tool (Stripe, Chargebee, Zuora, or Maxio) integrated with Intacct. The Salesforce CRM integration is excellent (Intacct and Salesforce have a strategic partnership), but CRM is not native. If you need full-suite ERP with billing, CRM, and project management in one platform, Intacct is not that.

Typical all-in cost: $40,000-$150,000 first year (software + implementation). Ongoing $30,000-$100,000/year.

Oracle NetSuite

Best for: SaaS companies that want a single integrated platform for financials, CRM, billing, and e-commerce

NetSuite is the most complete single-platform option for SaaS companies. SuiteBilling handles recurring subscription billing natively (including usage-based models and mid-term changes). Advanced Revenue Management handles ASC 606 revenue recognition with fair value allocation and contract modification support. The CRM is built in. Multi-subsidiary management is strong.

For SaaS companies that want one system instead of a best-of-breed stack, NetSuite is compelling. Your sales team logs deals in the CRM, billing generates invoices automatically, revenue recognition happens according to your rules, and financial consolidation rolls up across entities, all without data leaving the platform.

The downside is depth versus breadth. NetSuite does many things in one platform, but each individual module is not as deep as the best-in-class alternative. SuiteBilling is good but not as flexible as Zuora or Chargebee for complex billing scenarios. Advanced Revenue Management handles standard ASC 606 cases well but can struggle with highly complex arrangements. And NetSuite's pricing is aggressive: expect significant negotiation, and understand that the list price is rarely the final price.

Typical all-in cost: $60,000-$200,000 first year. Ongoing $40,000-$120,000/year.

Acumatica

Best for: SaaS companies with high user counts that want unlimited-user pricing

Acumatica's resource-based pricing (no per-user fees) makes it attractive for SaaS companies where many departments need ERP access. The cloud platform is modern, the API is strong, and the financial management capabilities are solid. Project accounting is available for tracking professional services engagements.

For SaaS companies, Acumatica requires more integration work than Intacct or NetSuite. You will need third-party tools for subscription billing, and the ASC 606 revenue recognition capabilities are less mature than Intacct's or NetSuite's. However, for SaaS companies with relatively simple billing models (annual subscriptions, straightforward pricing) and a need for project accounting alongside financials, Acumatica offers strong value.

Typical all-in cost: $40,000-$120,000 first year. Ongoing $25,000-$80,000/year.

SAP Business ByDesign

Best for: Global SaaS companies with operations in multiple countries that need localized compliance out of the box

If your SaaS company has entities in five or more countries, ByDesign's built-in country localizations and multi-currency capabilities are a significant advantage. The platform handles intercompany transactions, transfer pricing, and local statutory reporting better than most mid-market alternatives. For European SaaS companies expanding globally, or US SaaS companies with significant international operations, ByDesign deserves serious evaluation.

The revenue recognition capabilities are functional but not as specialized for SaaS as Intacct's. You will likely need a billing integration for complex subscription scenarios. The user interface is utilitarian rather than modern. But for the specific use case of managing a global SaaS finance operation across many jurisdictions, ByDesign is underrated.

Typical all-in cost: $50,000-$150,000 first year. Ongoing $35,000-$100,000/year.

FinancialForce / Certinia

Best for: Services-heavy SaaS companies that run their business on Salesforce

Certinia (formerly FinancialForce) is built natively on the Salesforce platform. If your company lives in Salesforce for CRM, CPQ, and customer success, Certinia puts your financial data on the same platform. There is no integration between CRM and ERP because they share a database.

The professional services automation (PSA) module is genuinely best-in-class. For SaaS companies where professional services represent 20%+ of revenue, having PSA tightly integrated with financials and CRM eliminates the data silos that plague most SaaS companies. Resource management, project accounting, time and expense, and services revenue recognition are all handled in one place.

The limitation is that you are locked into the Salesforce ecosystem. If you ever leave Salesforce (unlikely for most SaaS companies, but possible), you lose both your CRM and your ERP. Certinia also inherits Salesforce's per-user pricing model, which gets expensive. And while the financial management capabilities are solid, they are not as deep as Sage Intacct for pure financial management use cases.

Typical all-in cost: $60,000-$200,000 first year (including Salesforce platform costs). Ongoing $50,000-$150,000/year.

Zuora + ERP

Best for: SaaS companies with highly complex billing models that need best-in-class subscription management

Zuora is not an ERP. It is a subscription billing and revenue management platform that pairs with your ERP of choice. We include it here because for SaaS companies with complex billing requirements (usage-based pricing, multi-tier plans, extensive self-service modifications, complex co-termination rules), Zuora is the gold standard.

Zuora Revenue handles ASC 606 compliance with sophisticated fair value allocation, contract modification waterfall, and disclosure reporting. Zuora Billing handles virtually any subscription billing scenario you can design. The combination of Zuora for billing and revenue management plus Sage Intacct or NetSuite for general ledger and financial reporting is a common and effective architecture for growth-stage SaaS.

The cost and complexity of this approach are the downsides. You are running and maintaining two mission-critical financial systems plus an integration between them. Zuora's implementation requires specialized expertise. And the combined cost of Zuora plus an ERP is higher than a single-platform approach.

Typical all-in cost for Zuora component: $40,000-$150,000/year depending on transaction volume, plus the cost of your ERP.

Best ERP Systems for Enterprise SaaS ($100M+ ARR)

At this stage, you are likely a public company or on the path to IPO. SOX compliance is mandatory or imminent. Your finance team has 20-50+ people. You need enterprise-grade systems with the controls, scalability, and reporting capabilities that public markets demand.

Workday Financial Management

Best for: Public SaaS companies that want a modern, cloud-native financial management platform

Workday is used by many of the largest public SaaS and technology companies (Salesforce, Netflix, HP, and others). Its cloud-native architecture, continuous monthly updates, and modern user interface set it apart from legacy enterprise ERP. The financial management suite covers core accounting, revenue management, grants management, and projects.

For SaaS companies, Workday's strength is combining financial management with world-class HCM (human capital management) on a single platform. In a business where people costs represent 70-80% of expenses, having workforce planning, compensation, and financial planning on the same platform is powerful. Workday Adaptive Planning adds FP&A capabilities that connect headcount plans to financial forecasts.

The limitation is cost and implementation timeline. Workday implementations typically run 9-18 months and cost $1M-$5M+ for enterprise deployments. The revenue recognition capabilities are solid but may require Zuora or a similar tool for complex subscription billing. And Workday's per-employee pricing model means costs scale with headcount, which in a SaaS company is your largest expense.

Typical all-in cost: $500,000-$3M+ first year. Ongoing $300,000-$1M+/year.

SAP S/4HANA Cloud

Best for: Large enterprise technology companies with complex global operations and deep ERP requirements

SAP S/4HANA is the enterprise ERP standard for large global companies. The cloud edition provides the depth of SAP's financial management, supply chain, and analytics capabilities with reduced infrastructure burden. For technology companies with $500M+ in revenue, complex manufacturing operations (hardware alongside software), or extensive global operations requiring deep regulatory compliance, S/4HANA is a serious contender.

The RAR (Revenue Accounting and Reporting) module handles ASC 606 at enterprise scale. Multi-entity operations across dozens of countries with local statutory reporting are a core strength. Integration with SAP Analytics Cloud provides advanced planning and reporting.

The downside is everything you have heard about SAP: long implementation timelines (18-36 months is common), high cost ($2M-$10M+), deep consulting dependence, and a user experience that, despite improvements, lags behind modern cloud-native alternatives. For a SaaS company that does not have complex manufacturing or supply chain needs, S/4HANA is typically overkill.

Typical all-in cost: $2M-$10M+ first year. Ongoing $500,000-$3M+/year.

Oracle ERP Cloud (Fusion)

Best for: Public technology companies that need comprehensive enterprise financial management with strong reporting

Oracle ERP Cloud competes directly with Workday and SAP at the enterprise level. Its strengths include deep financial management capabilities, strong enterprise reporting (Oracle OBIEE / Oracle Analytics Cloud), and the broadest functional coverage of any cloud ERP (financials, procurement, project management, risk management, and more).

Revenue Management Cloud handles ASC 606 with fair value allocation, contract modification tracking, and disclosure reporting. The intercompany module handles complex transfer pricing and elimination scenarios. For public SaaS companies with complex procurement needs (cloud infrastructure costs, contractor management), Oracle's procure-to-pay capabilities are strong.

The challenge is Oracle's sales model and implementation complexity. Licensing negotiations are notoriously complex. Implementation timelines are long (12-24 months). And Oracle's cloud platform, while functional, is not as modern in user experience as Workday.

Typical all-in cost: $1M-$5M+ first year. Ongoing $500,000-$2M+/year.

Microsoft Dynamics 365 Finance

Best for: Enterprise technology companies in the Microsoft ecosystem that want Azure-native ERP

Dynamics 365 Finance is Microsoft's enterprise financial management offering, and for companies deeply invested in Azure, Power BI, and the Microsoft 365 ecosystem, it provides natural integration. Revenue recognition capabilities handle ASC 606 scenarios. Multi-entity operations are supported. The Power Platform extends functionality through custom apps and automations.

For technology companies that are also Microsoft partners, Azure customers, or otherwise committed to the Microsoft stack, Dynamics 365 Finance reduces integration complexity and leverages existing platform investments. The manufacturing and supply chain modules (Dynamics 365 Supply Chain Management) are available for tech companies that produce hardware.

The limitation is that Dynamics 365 Finance is less commonly deployed in the SaaS industry than Workday, NetSuite, or Intacct. You may find fewer pre-built SaaS-specific configurations and fewer implementation partners with deep SaaS industry experience. The subscription billing capabilities are less mature than dedicated billing platforms.

Typical all-in cost: $500,000-$3M+ first year. Ongoing $200,000-$1M+/year.

Essential ERP Capabilities for SaaS Companies

When evaluating ERP systems, here are the capabilities that matter specifically for software and SaaS businesses, ranked by criticality:

Non-Negotiable

• ASC 606 revenue recognition engine: Must handle multi-element arrangements, standalone selling price allocation (residual, adjusted market assessment, expected cost plus margin approaches), variable consideration, and contract modifications. Manual workarounds for revenue recognition are audit risks and time bombs.
• Deferred revenue management: Automated scheduling, waterfall reporting, and the ability to handle thousands of deferred revenue schedules without spreadsheets. Must tie to the GL without manual journal entries.
• Multi-element arrangement handling: The ability to split a single contract into multiple performance obligations with different recognition patterns (point-in-time versus over-time) is fundamental to SaaS accounting.
• Audit trail and SOX compliance: Immutable audit logs, segregation of duties enforcement, and the ability to produce SOX evidence packages. If you are heading toward an IPO or acquisition, this is non-negotiable even before you are required to comply.

Critical for Operations

• Subscription billing and management: Either native or through a tightly integrated billing platform. Must handle upgrades, downgrades, mid-term changes, prorations, co-terminations, and automatic renewals.
• SaaS metrics and KPI dashboards: ARR, MRR, net revenue retention, gross churn, expansion revenue, CAC payback, and LTV calculations derived from source financial data. Board-ready dashboards that update automatically.
• Multi-entity and intercompany elimination: Automated intercompany transactions, currency translation (CTA calculations), and minority interest handling. Must support consolidation across 3-50+ entities.
• Commission management (ASC 340-40): Capitalize and amortize commission costs per ASC 340-40. Track at the individual contract level. Handle accelerators, clawbacks, and multi-year deal structures.

Important for Scale

• R&D capitalization tracking (ASC 350-40): Tie engineering time tracking to the GL for proper capitalization of internal-use software development costs. Automate the distinction between preliminary, application development, and post-implementation phases.
• Professional services project accounting: For SaaS companies with services revenue, track project profitability, resource utilization, time and expense, and services revenue recognition.
• Equity management integration: Cap table integration (Carta, Shareworks) for stock-based compensation expense (ASC 718) calculation and recording.
• FP&A and budgeting integration: Connect your financial plan to actual results. Headcount planning, expense forecasting, and revenue modeling that ties to ERP actuals.

How ERP Supports IPO Readiness

If going public is on your roadmap (even a distant one), your ERP infrastructure either accelerates or delays the process. Here is how ERP plays a role in the IPO journey:

Two to Three Years Before IPO

This is when you should have your ERP in place and running smoothly. Auditors will need two to three years of audited financial statements, and those statements need to come from a system with proper controls. Implementing ERP during the IPO process is like changing the engine while driving. Companies that wait too long frequently face 6-12 month IPO delays.

SOX Compliance Foundation

Sarbanes-Oxley Section 404 requires public companies to maintain internal controls over financial reporting. Your ERP is the system of record for those controls. Segregation of duties, approval workflows, access controls, and audit trails must be designed into your ERP from the start. Retrofitting SOX controls into a poorly configured ERP is expensive and disruptive.

Revenue Recognition Under Scrutiny

Revenue recognition is the most common area of financial restatement for SaaS companies. The SEC and audit firms pay close attention to ASC 606 compliance, particularly for companies with complex multi-element arrangements. An ERP with robust, automated revenue recognition is not just operationally efficient. It is a requirement for credible public company financial statements.

Multi-Entity Financial Consolidation

Public companies must produce consolidated financial statements that comply with US GAAP (or IFRS). Automated consolidation with intercompany elimination, currency translation, and minority interest is expected. Manual consolidation spreadsheets are a red flag for auditors and investors.

Accelerated Close Process

Public companies must file quarterly results within 40-45 days and annual results within 60-75 days. Your month-end close process needs to be fast and reliable. Companies targeting IPO should aim for a 5-10 business day close cycle, which requires automation that only a well-implemented ERP can provide.

What Will This Cost? Honest Pricing for SaaS Companies

Growth Stage ($5M-$100M ARR)

ERP software: $30,000-$150,000 per year depending on vendor, modules, and user count.

Implementation: $50,000-$300,000 for a standard deployment including data migration, configuration, integrations, and training. Complex implementations with multiple integrations (billing platform, CRM, HRIS, expense management) can reach $500,000.

Billing platform (if separate): $15,000-$100,000 per year depending on transaction volume.

Ongoing costs: $50,000-$200,000 per year including software subscriptions, support, and periodic enhancements.

Total first-year investment: $80,000-$500,000 depending on complexity.

Enterprise Stage ($100M+ ARR)

ERP software: $200,000-$2M+ per year.

Implementation: $500,000-$5M+ for enterprise deployments with deep customization, complex integrations, global rollout, and organizational change management.

Ongoing costs: $300,000-$3M+ per year including software, support, managed services, and continuous improvement.

Total first-year investment: $1M-$7M+ depending on scope and vendor.

Hidden Cost Drivers Specific to SaaS

• Revenue recognition configuration: ASC 606 setup is the most time-consuming part of any SaaS ERP implementation. Budget 20-30% of implementation hours for this alone.
• Billing system integration: If you use a separate billing platform, the integration is complex. Order-to-cash data flow, revenue schedule synchronization, and deferred revenue reconciliation require careful design.
• Historical data migration for auditors: If you are implementing ERP in preparation for an audit or IPO, you may need to restate or migrate historical revenue recognition data. This adds significant cost.
• Commission calculation complexity: Building ASC 340-40 compliant commission tracking, especially with retroactive deal changes and multi-year amortization, is a common source of scope creep.

Frequently Asked Questions

When should a SaaS company move from QuickBooks to a real ERP?

Most SaaS companies outgrow QuickBooks between $3M and $10M ARR. The trigger is usually one of three things: you have a meaningful audit coming (Series B+ investors or acquisition interest), you need multi-entity consolidation for international operations, or your ASC 606 revenue recognition has become too complex to manage in spreadsheets. If your finance team is spending more than 20 hours per month on revenue recognition spreadsheets, the ROI of ERP is clear.

Do I need a separate billing platform, or can my ERP handle subscription billing?

It depends on your billing complexity. If you have straightforward annual or monthly subscriptions with infrequent changes, NetSuite SuiteBilling or a similar native ERP billing module may suffice. If you have usage-based pricing, complex self-service upgrade/downgrade paths, high-volume billing (thousands of invoices per month), or need a customer-facing billing portal, a dedicated billing platform (Stripe Billing, Chargebee, Zuora, Maxio) paired with your ERP is the better architecture. Most SaaS companies above $20M ARR use a separate billing platform.

How important is ASC 606 automation in ERP for SaaS companies?

Critically important, and more so as you scale. At 100 deals per year with simple terms, you can manage ASC 606 in spreadsheets (carefully). At 500+ deals with multi-element arrangements, contract modifications, and variable consideration, spreadsheet-based revenue recognition becomes an audit risk and a massive time drain. ASC 606 automation in ERP ensures consistency, reduces errors, provides an audit trail, and frees your accounting team for analysis instead of data entry. If you are heading toward an IPO or acquisition, automated ASC 606 is effectively mandatory.

Which ERP do most SaaS companies use?

In the growth-stage mid-market ($5M-$100M ARR), Sage Intacct and Oracle NetSuite dominate. Intacct has a stronger position among companies that prioritize financial management depth and often pair it with Salesforce CRM and a billing platform. NetSuite appeals to companies that want a single integrated platform. At the enterprise level ($100M+ ARR and public companies), Workday, Oracle ERP Cloud, and SAP S/4HANA are the most common choices, with Workday being the most popular among SaaS-native companies.

How long does a SaaS ERP implementation take?

Growth-stage implementations typically take 12-20 weeks for core financials plus revenue recognition. Add 4-8 weeks for each major integration (billing platform, CRM, HRIS). Enterprise implementations take 9-18 months. The most common cause of delays is underestimating the complexity of ASC 606 configuration and billing system integration. Start the project with a detailed revenue recognition workshop, not a generic requirements gathering phase.

Should I wait until closer to IPO to implement ERP?

No. This is one of the most expensive mistakes SaaS companies make. Auditors need 2-3 years of financial history from a controlled system environment. Implementing ERP 6-12 months before a planned IPO means you may need to restate historical financials, which is expensive and time-consuming. Implement ERP when you cross $10M-$20M ARR and your accounting complexity demands it. The IPO readiness will follow naturally.

How do I handle the transition from cash-basis to accrual-basis accounting in the new ERP?

Many early-stage SaaS companies use cash-basis accounting in QuickBooks and must move to accrual-basis when implementing ERP (especially with ASC 606). This transition requires restating opening balances to accrual basis, setting up deferred revenue schedules for existing subscriptions, establishing prepaid expense and deferred cost schedules, and configuring accrual-basis revenue recognition going forward. Your implementation partner should have specific experience with this transition. It is not just a technical exercise. It changes how your financials look and requires communication with your board.

Can I use my ERP to calculate SaaS metrics, or do I need a separate tool?

Some ERPs (notably Sage Intacct with the SaaS Intelligence module) can calculate core SaaS metrics from source data. NetSuite can be configured for basic ARR/MRR reporting through saved searches. However, most SaaS companies use dedicated analytics tools (ChartMogul, Baremetrics, or custom dashboards in Looker/Tableau) for board-level SaaS metrics, with the ERP serving as the financial system of record. The critical requirement is that your SaaS metrics tie to your GAAP financials. If your ARR calculation and your revenue number come from different sources with different assumptions, you have a credibility problem with investors.

What about stock-based compensation (ASC 718)?

Stock-based compensation expense is a significant line item for SaaS companies. Most companies use a dedicated equity management platform (Carta, Shareworks, Pulley) to calculate the expense per ASC 718 and then integrate the journal entries into their ERP. Native ERP handling of stock-based compensation is rare and usually insufficient for the complexity of option grants, RSUs, ESPP plans, and ASC 718 modifications. Budget for this integration in your ERP project plan.

How do I evaluate whether an ERP can handle our revenue recognition requirements?

Prepare 5-8 real contract scenarios that represent your most common and most complex deals. Include a standard annual subscription, a multi-year deal with annual price escalation, a deal with subscription plus services plus training, a mid-term upgrade with co-termination, and a deal with usage-based components. Present these scenarios to the vendor during the demo and ask them to configure revenue recognition for each. If the vendor cannot demonstrate this in a live demo, they cannot do it in production.

Start With a Clear Requirements List

SaaS ERP selection is not about finding the "best" system. It is about finding the system that fits your specific stage, complexity, and growth trajectory. The first step is defining your requirements clearly so you can compare vendors on what matters to your business.

Our free ERP requirements tool helps you define and prioritize the capabilities that matter for your SaaS company, from ASC 606 revenue recognition to subscription billing to multi-entity consolidation.

Build Your ERP Requirements List