Statistic Info

The future of growth is product led. This isn’t merely the latest fad or buzzword. Data shows that companies leveraging a PLG strategy perform better on average -faster growth, higher margins, lower burn and stronger valuation multiples. As with many new operational strategies, OpenView believes product led growth will soon become the norm, making it table stakes for SaaS companies that want to win in their markets. What is your company doing to adapt to the product led growth revolution

HubSpot

More SaaS + Software Stats

The very best SaaS businesses have a negative revenue churn rate and will have a Revenue Retention Rate of greater than 100%

Revenue per employee has been steadily increasing in SAAS companies. It serves as a great longitudinal measuring stick to understand the increasing or decreasing efficiency of the business

Growth rate accelerates in the expansion stage ($2.5M – $10M ARR)

A 2017 SaaS Capital survey showed that young companies actually have higher retention rates than more mature SaaS businesses

SaaS organizations are now operating in over 100 countries

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

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

The largest SaaS companies (>$75million yearly revenue) attribute 2.5x as much new revenue to upselling than the smallest SaaS companies (<$1.25million): 28% versus 11%

Increases in revenue growth rates drive twice as much market-capitalisation gain as margin improvements for companies with less than $4 billion in revenues

More Growth Strategy Stats

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

At a 35% CAGR, it takes 10 years for a SaaS company to grow from $5M to $100M in ARR

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

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

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

The median average contract length is 1.3 years and the average billing term is seven months in advance in 2016. Comparable to 2015, with average contract length shortening from 1.5 to 1.3 years and average billing period increasing by one month from 2015 to 7 months

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

Invention is 10% inspiration and 90% perspiration.

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

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