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Account Churn is very important because it gives a very clear percentage of the customers that are leaving you. It takes away the bias from larger accounts so that you aren’t left with one large customer paying for all of your revenue – which is a dangerous situation to be in

InsightSquared

More SaaS + Software Stats

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%

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

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

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

Analyzed by contract value, field sales are primarily evident for companies with median deals over $25K. Inside sales strategies are most popular for companies with $1K-$25K median deal sizes

How Often Should The Pricing Committee Be Meeting And Making Changes?

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

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

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

SAAS companies need to track the number of visitors, trials and closed deals; And also track the conversion rates, with the goal of improving those over time

More Growth Strategy Stats

Gross dollar churn among companies with an internet go-to-market strategy saw a meaningful increase, up from 8% in 2015

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

It’s common for startups to grow rapidly, doubling or tripling in size year over year, until they hit $5M in ARR

Smaller SAAS companies reported more frequent use of third-party providers as their primary application delivery method, while the largest companies were more likely to use self-managed servers

More than 1/2 of SAAS companies increased their spending on customer retention last year

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

SaaS businesses face significant losses in the early years (and often an associated cash flow problem)

The best SAAS businesses have a LTV to CAC ratio that is higher than 3, sometimes as high as 7 or 8

If your Net Revenue Churn is high (above 2% per month) it is an indicator that there is something wrong in your business

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