Statistic Info

We wanted to find out, so as part of our 2016 Sales Benchmarking Report, we took a close look at the Quick Ratios of the high-growth SaaS companies in our study. We sliced the data in every conceivable way to see what we could uncover about the optimal Quick Ratio for growing SaaS companies, and how the SaaS Quick Ratio evolves as companies grow.

InsightSquared

More SaaS + Software Stats

The median TTM revenue growth rate + adj. EBITDA margin for publicly traded SaaS companies was ~37%, implying that just under one half met or exceed “The Rule of 40%”

The average Quick Ratio of fastest growing SaaS companies (those with a CAGR of over 50%) is 3.9: generating $3.9 in revenue for every $1 lost to revenue churn

After $10M in ARR, the median growth rate slows to just under 50%

The median startup spends 92% of first year revenue on customer acquisition, taking 11-months to payback their Customer Acquisition Cost

Customer Acquisition Cost (CAC) = sum of all sales & marketing expenses/ number of new customers added

In 2017, IBM generated 37.8 billion U.S. dollars in global IT services revenue, making it the largest IT services company in the world in terms of net sales

The median SaaS business loses about 10% of its revenue to churn each year and that works out to about 0.83% revenue churn a month

Internet Sales strategies have a significantly lower CAC of just $0.42

SaaS, and other recurring revenue businesses are different because the revenue for the service comes over an extended period of time (the customer lifetime)

Achieving a SaaS Quick Ratio of 4 is a good benchmark for young, high-growth companies but the equation changes as those companies reach scale

More Growth Strategy Stats

High-growth companies generate 60% fewer sales opportunities than low-growth companies

In 2018, the U.S. imported aerospace products worth about 53.98 billion U.S. dollars.

More than two thirds of SAAS companies experienced annual churn rates of 5% or higher

36% of SaaS businesses managed to reduce their revenue churn over the last 12-months

Revenue Churn Rate = (RCR) (MRR at beginning of month – MRR at end of month) – MRR in upgrades during month / MRR at beginning of month

The median annual contract value (ACV) was $25K, $21K, $21K, $20K in 2016, 2015, 2014 and 2013

The very best SAAS companies keep monthly revenue churn at around 0.58%, that’s only about 7% revenue churn a year

orecasts suggest that global blockchain technology revenues will experience massive growth in the coming years, with the market expected to climb to over 23.3 billion U.S. dollars in size by 2023.

Achieving a SaaS Quick Ratio of 4 is a good benchmark for young, high-growth companies but the equation changes as those companies reach scale

It’s 9x cheaper to retain existing customers than acquire new customers: costing $0.13 to acquire any additional dollar of revenue