It’s Getting (Slightly) Easier to Sell Software

After a rough couple of years, software companies are finding it easier to sell their products to businesses. New data show that privately held software companies selling subscription services spent less time and money in the fourth quarter of 2023 to secure new customers, compared with earlier in the year.

Preliminary data from January suggest the trend has continued, said Miguel Fernández, co-founder and CEO of startup lender Capchase, which tracks the financial statements of 1,500 private software companies. (The businesses provide the data to Capchase to qualify for loans.) Businesses that tightened their wallets in 2022 and much of 2023 have been more willing to buy software as inflation has cooled and interest rates have leveled off. At the same time, sales costs have declined, in part because software companies have laid off salespeople. Still, we’re not back in the heady days of 2021: Buyers are taking longer to pay their bills.