Statistic Info

Consistently retaining customers is an important characteristic of any successful SaaS business, and an entire industry, Customer Success, has sprouted up to help SaaS executives do just that. However, knowing what is a “good” retention rate for your individual SaaS company remains difficult to pin down. This research helps answer that question based on our survey of over 700 private SaaS companies.

SaaS customer retention is broken down by:

  • average contract value
  • company size
  • company age

This brief also explores the relationship between growth and retention, the “false positive” retention rates of young SaaS businesses, and the impact of Customer Success programs on overall retention.

Saas Capital

More SaaS + Software Stats

Internet sales-driven companies have a much greater reliance on marketing, with 65% of the median company’s CAC budget devoted to marketing

For a SaaS business of almost any scale, the valuation impact of better retention is in the tens of millions over time

Software and online services are in a period of dizzying growth

Moving from $1.5 million with an eye towards $10 million in ARR is a tough a task and will take an excellent VP of sales to get you there

If your Net Revenue Churn is high (above 2% per month) it is an indicator that there is something wrong in your business; this will become a major drag on 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 median SaaS business generates 16% of its new Annual Contract Value (ACV) from upselling to existing customers

SaaS solutions have the highest security features with 95% security failures due to human error

Account Churn Rate (ACR) = customers at beginning of month – customers at the end of month / customers at beginning of month

51% of large (revenue >$2.5million) SaaS companies use field sales as their primary method of distribution

More Growth Strategy Stats

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

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.

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

In 2018, the market size of information technology outsourcing amounted to 62 billion U.S. dollars.

In 2018, the revenue of General Dynamics amounted to nearly 36.2 billion U.S. dollars.

For SaaS companies valued at over $1billion, the median amount of financing raised is $206million

General Dynamics is a market leader in the aerospace and defense industry. In 2018, a total of 105,600 people were working at General Dynamics.

Internet sales-driven companies have a much greater reliance on marketing, with 65% of the median company’s CAC budget devoted to marketing

In 2017, Foxconn Technology Group achieved a net income of 135.37 billion New Taiwanese dollars, the equivalent to approximately 4.55 billion U.S. dollars.

The median annual unit churn for SAAS companies was 10% in 2016