Rick Perreault of my portfolio company Unbounce recently called my attention to an interesting comparison between two SaaS models: Hubspot & Moz – A Tale of Two (Very Different) SaaS Business Models.

At first glance, Hubspot and Moz are very similar companies: both are popular marketing platforms, use web-based subscription models, and primarily target the SMB market (although larger brands use both). However, as Scott Krager points out in his post, the companies have vastly different approaches for generating revenue. You can read Krager’s article for all the figures (many of which are from Hubspot’s S1 SEC filing and from Moz directly), but here are some of the key differences:

• Hubspot spends $11,233 to acquire a new customer. Moz spends $131 to acquire a new customer
• Hubspot’s average revenue per customer: $8,670 per year. Moz’ average revenue per customer: $1,295 per year
• Hubspot made $161.8 million from 2009-2013. Moz made $72.5 million from 2009-2013

Hubspot has grown revenue much faster than Moz, but has also spent much more to do so. Its customer acquisition costs are roughly 85 times that of Moz (if Krager’s figures are accurately comparing apples to apples).

So, is one company right? The answer is no. Since investors (whether private or public) like to see growth, Hubspot’s story is more impressive from that standpoint. Likely, Hubspot’s founders and investors pushed for market growth and dominance regardless of cost. After the IPO, they can recover those losses.

However, Hubspot’s high-flying approach is much higher risk and harder to execute on. Things are great as long as you can maintain growth. As soon as your business stops growing, your valuation multiples come crashing down and you can be in serious trouble.

The right strategy all depends on the comfort level of the founder team and where they want to play on the risk/reward scale.