Most companies treat forecasting like a one-time effort. You build it once, check a box, and move on. But SaaS revenue forecasting helps you do more than project growth. It builds a system that helps you see what is coming so you can react while there is still time.
It is how to avoid hiring too early or fundraising too late. You steer the business with your eyes open.
In this guide, we’ll build a SaaS revenue forecast from scratch. You’ll see how to structure drivers, layer in costs and seasonality, map sales quotas, and keep it all live. Every number will flow into the next… the way it actually should.
Why revenue forecasting matters
Good forecasts show you the future before it even happens. They tell you when churn might spike, when you will need to hire, when cash flow could get tight, and if your targets are even realistic.
But it’s not just about foresight. It’s about coordination.
When the revenue forecast is solid, sales knows what to aim for. Finance knows what it will cost. Leadership has a real sense of whether growth is sustainable or just wishful thinking. This improves decision making across the entire organization.
Without forecasting, you do not get that. You get guesses. You get chaos. You get teams rowing in different directions.
And it shows up later when you are already behind.
What to gather before you start
Great SaaS revenue forecasting starts with good inputs. You need reliable historical data to build a meaningful model. Here is what you will need:
- Customer and revenue data: At least 12 months of monthly recurring revenue, churn, expansion, and pricing.
- Sales assumptions: Pipeline velocity, win rates, and conversion rates.
- Cost structure: Salaries, variable costs, commissions, and customer acquisition costs.
- Seasonality: Month-by-month shifts in signups or close rates.
- Sales team plan: Quotas, start dates, roles, and ramp capabilities.
You’ll feed all of this into Runway. Once it’s in, everything connects, from bookings to costs to runway.
Building a live SaaS revenue forecast in Runway
Let’s say you’re building a forecast for a company called DataFlow.
You sell three pricing tiers:
- Starter: $99/mo
- Professional: $499/mo
- Enterprise: $2,499/mo
Your existing customers look like this:
- 150 customers on Starter
- 40 customers on Professional
- 8 customers on Enterprise
You plug that into Runway’s customer database. Then you set churn and upgrade assumptions:
- Starter churn: 5% monthly
- Pro churn: 3%
- Enterprise churn: 2%
- Upgrades: 10% move from Starter to Pro yearly, 5% from Pro to Enterprise
Next, you model acquisition:
- Self-serve: +25 Starter per month
- Sales-led: +8 Pro and +2 Enterprise per month
Just build your formulas. Runway will turn all that into annual recurring revenue by tier instantly. Change churn or bookings and your entire revenue forecasting model updates automatically. This is essential for fast-moving SaaS businesses that need to adapt quickly.
Mapping cost drivers and expenses
Costs in SaaS aren’t flat. Some grow with customers while others scale with revenue or headcount. Distinguishing between these drivers helps you understand your true gross margins and cash flow timing.
Here’s what DataFlow models:
Fixed monthly costs
These represent your operating expenses (OpEx). You include them to establish your baseline burn rate and understand what it costs just to keep the business running.
- Salaries: $85,000
- Office/tools: $8,000
Variable costs
These contribute to your Cost of Goods Sold (COGS). You track these to monitor gross margin health and ensure that adding new customers stays profitable as you scale.
- Hosting: $8 per customer
- Payments: 2.9% of revenue
- Success: $200 per Enterprise customer
Growth investments
These form your Customer Acquisition Cost (CAC). You map these expenses to calculate unit economics and ensure your sales and marketing spend yields a healthy payback period.
- Marketing: $15,000
- Commissions: 10% of new bookings
Headcount plans go in too. Since talent is often the largest expense, you need accurate timing to prevent cash surprises.
- Hire 2 AEs in Q2 at $70K/year
- Ramp: 2 months training, then full quota in 6
- Runway ties their salaries and commissions to hiring dates
The result is a dynamic forecast. As reps ramp up or hiring dates shift, your expenses and revenue projections adjust automatically.
Applying seasonality to your forecast
Seasonality can skew your numbers if you don't factor it in.
DataFlow sees:
- Enterprise deals spike in Q4
- Pro slows in summer
- Starter dips in December
Runway models this using monthly multipliers:
- Enterprise: 150% in Q4
- Pro: 70% in July/Aug
- Starter: 60% in Dec
Add these to your acquisition and upgrade drivers. Use date formulas so they repeat yearly. Want to segment by industry? Add overrides. The patterns stay realistic and follow best practices for accurate modeling.
Modeling sales quotas and ramp
Revenue does not just appear. It comes from rep capacity. Accurate SaaS sales forecasting relies on getting this capacity right.
In Runway, you add a sales team database:
- Name, role, start date, quota
- Ramp schedule
- Attainment
You define the ramp logic clearly. It might look like 0% for the first two months, 50% for months three and four, 75% for months five and six, and full productivity after month seven.
Then you calculate bookings capacity:
- Monthly quota x attainment x ramp schedule
- Split capacity by tier
Add those Q2 hires. Their quotas get rolled into bookings, revenue, and ultimately cash. No manual updates required.
Avoid common modeling traps
Getting the math right is step one. You also need to reflect reality options to ensure your model holds up.
Ramp speed varies
Don't assume everyone is a rockstar immediately. Adjust ramp schedules based on role seniority or deal complexity. An enterprise AE takes longer to build a pipeline than a high-volume transactional rep.
Turnover happens
If you assume every seat stays filled forever, your revenue numbers will look inflated. Build in a buffer for unexpected departures. This keeps your hiring plan honest and your targets achievable.
Support is essential
Quota carriers don't work in isolation. For every group of reps, model the necessary sales engineers and managers. Omitting these costs creates an artificially low CAC and ignores the infrastructure reps need to close deals.
Attainment isn't guaranteed
100% attainment is a target, not a baseline. Stick to that 85% average or lower for unproven territories. It creates a forecast you can stand behind when talking to the board or your team.
For more, see how to plan revenue with a strong sales capacity model.
What a connected revenue forecast unlocks
Once built, this forecast gives you a live view of your business. You gain visibility into long-term metrics like customer lifetime value alongside immediate operational data:
- MRR/ARR by tier, with churn and upgrades applied
- Bookings from quotas, converted into new customers
- Gross margin, layered with cost drivers
- OpEx from headcount, including ramp and commissions
- Runway, updated with every change
You can tweak any variable (churn, hiring, pricing), and see everything ripple across the model. This is real-time revenue forecasting. Not static. Never stale.
Forecasting that stays current
The problem with spreadsheets is that they don’t update themselves. But Runway does.
Every time you sync actuals, the forecast updates. Missed quota? It shows. Extra hires? They show too.
And because it’s structured, you can test scenarios fast:
- What if churn ticks up 1%?
- What if Q2 hires shift to Q3?
- What if quota jumps?
Use Runway’s scenario planning to test, compare, and adjust without rebuilding anything.
Why revenue forecasting is easier in Runway
Forecasting in spreadsheets means wrestling with linked tabs and broken formulas.
In Runway, it helps you execute best practices naturally because it is built in.
- Drivers are structured and visible
- Date math is automatic
- Seasonality and ramp work out of the box
- Actuals stay in sync
You can build a revenue forecasting model in days (not weeks). And when the business changes, your plan doesn’t break.
Ready to get started?
Revenue forecasting shouldn’t be a burden. It should be the thing that gives you clarity, aligns your teams, and help you grow without flying blind.
Try Runway and see how fast you can go from scattered data to shared understanding.