Statistic Info

By definition, non-renewal rates are higher than gross dollar churn rates. However, it is interesting to see that the non-renewal rates are also higher for shorter duration contracts.

For Entrepreneurs.com

More SaaS + Software Stats

If your Net Revenue Churn is high (above 2% per month) it is an indicator that there is something wrong in your business; which may have a dramatically negative effect on your company’s growth. Source: Mckinsey

Because of the losses in the early days, which get bigger the more successful the company is at acquiring customers, it is much harder for management and investors to figure out whether a SaaS business is financially viable.

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

26% of SAAS companies with at least $15MM in 2015 GAAP revenue had a revenue growth rate + EBITDA margin of 40% or higher

SAAS companies with >$250K median ACV book nearly 25% of their contracts at 3 years or longer

When venture capitalists participate in seed rounds, the average round size is 3x larger

54% treat upselling and add-on sales as high priority

As companies scale their growth engines, a slightly-above-average churn rate becomes harder and harder to offset with net new revenue growth, especially when the goal is to outpace it by 4x

The average company booking professional services revenue on new deals is equivalent to 16% of the first year subscription value. Professional services margins are approximately 22%

Growing faster has twice as much impact on share price as improving margins

More Growth Strategy Stats

86% of SaaS businesses treat “New Customer Acquisition” as their highest growth priority, both in terms of executive support and funding available

The median SaaS business generates 16% of its new Annual Contract Value (ACV) from upselling to existing customers

Japanese company Hitachi accounted for three percent of the world’s market for diagnostic imaging in 2017.

It’s 4x cheaper to upsell existing customers than acquire new customers: costing just $0.28 to acquire an additional dollar of revenue

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 SaaS business generates 16% of its new Annual Contract Value (ACV) from upselling to existing customers

Companies that spend more on sales and marketing (as a % of revenue) generally grew at a faster rate than those that spent less

Software and online services are in a period of dizzying growth

The fastest growing SAAS companies averaged $250k in MRR and were only losing around 3.2% of that revenue each month to churn

The very best SAAS business has a negative churn rate and will have a Dollar Retention Rate of greater than 100%