Scaleups Saving on Software: Some Cut Spend by 11% in December

Data from Cledara reveals companies are adapting to the economic downturn by saving on software spend.

January 25, 2023


As tech company layoffs continue, new data from Cledara reveals that scaleup companies are finding creative ways to adapt to the economic downturn by saving on software spend. Growth in software spend slowed during the spring of 2022 and while there were upticks in the summer and November, December brought with it a reduction in spend of 2.9% as companies began reducing software costs.

We dug into our data to learn how companies have adapted their software budget to the economic downturn. Here are the results:

Scaleups spend on software, Month-over-month. Source: Cledara

Software Savings in December

Overall software spend was reduced by 2.9% in December 2022 as companies cut costs.

  • Spending on software by scaleups started 2022 strongly, with acceleration through the month of August, but a definite slowdown began in the fall.
  • November saw an uptick in the pace of aggregate spend. November's software spend accelerated, on a rolling 4-month basis – a return to strong growth that boded well for SaaS vendors.
  • But December brought the first overall net decline in spend of 2.9% as companies began to cut costs.

Richard Gargan, analyst for Cledara, said:

While laying off staff can be a quick way to control costs, this could be regrettable when the economy improves and the job market tightens. Software spend is often businesses second-biggest expense after headcount, so cost-cutting measures like removing software subscriptions with duplicate features, removing licenses that aren’t being used, can lead to big savings.

Software Savings by Size of Spend

We then split companies into quartiles to see how different sized software budgets had reacted to the economic downturn. All quartiles have taken a hit, but the bottom quartile of spenders dropped the most in December by 11.1%.

  • The top quartile (+$140,000 software spend in 2022) was the slowest growing throughout most of the year.
  • The second quartile ($64k-139k software spend in 2022), continued growth longer into the year, especially into August, and quickly returning to growth in spend in November, but then reduced software spend in December by 4%.
  • The third quartile’s ($29-63k software spend in 2022) spend growth, peaked in August, but saw a slower pace of growth in all the following months with December also seeing a shrinkage in software spend of 1.8%.
  • The bottom quartile (<$28k software spend in 2022) saw typical growth in software spend throughout most of the year, and then net declining spend from October, with a 11.1% decline in December.

Software Vendor Ranking

While companies are saving on software, some software vendors are seeing big increases in popularity. These 10 vendors saw +90% growth in average monthly spend in Q4 vs Q3.

Fastest growing software vendors, Q4 2022 vs Q3 2022. Source: Cledara

Vendors winners analysis

In Q4, our 50 most popular software vendors saw an uptick in spend vs. the rate of spend in Q3, despite the economic context.

  • Dext, the expense management automation and bookkeeping platform, saw incredible growth in spend during December of 455%
  • The 50 most popular SaaS vendors saw a 45% increase in spend over Q4 compared with the Q3 monthly average – with 43 of 50 seeing an increase and 7 seeing a decrease.
  • This shows that software staples like team collaboration software, office software, and communications software are being retained, while spend on smaller software vendors are being cut to save costs.

Up Next

Stay tuned for Cledara’s report on software spend for January, coming out in February. Subscribe to our newsletter below to be notified when we release this report.

Click to learn more about Cledara’s SaaS management platform, the one platform to manage all your software subscriptions that helps companies reduce software costs by 15% and save +20h a month on software admin.


For software spend analysis, Cledara looked at a sample of 154 companies it serves who have a 12-month history of spending on software vendors in 2022. 

For vendor winners analysis, we selected software vendors with over $20,000 in annual spend using Cledara in 2022 and who had at least 5 Cledara customers in each month over the year.

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