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

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.

More Growth Strategy Stats

Since churn is so important, wouldn’t it be useful if we could predict in advance which customers were most likely to churn?

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

The average company gets 16% of new ACV sales from up-sells and expansions, though companies with revenue between $10MM-$40MM are relying more heavily on up-sell and expansions

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

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

In 2020, China is expected to generate 55 billion U.S. dollars in the global medical technology market.

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

A University of Texas study showed that women ask for $7,000 less than their male counterparts in job interviews

SAAS companies that are focused mainly on enterprise sales have higher levels of professional services