Statistic Info

Monthly vs. Annual Churn Rates

Now, just so we’re on the same page, 5% – 7% Annual churn – the good churn rate – translates to 0.42 – 0.58% monthly churn.

This means companies with acceptable churn only lose about 1 out of every 200 customers (or dollars) per month.

Now that’s a solid platform you can really build a high-growth company on.

On the flip side, a high churn rate is the reason you ended 2012 with a whole bunch of new customers… but had about the same amount of revenue.

Churn is the reason that – though you acquired a lot of new logos in 2012 – you had no significant year over year growth from 2011.

sixteenventures.com

More SaaS + Software Stats

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

Achieving a SaaS Quick Ratio of 4 is a good benchmark for young, high-growth companies but the equation changes as those companies reach scale

SaaS IPOs have more than doubled over the last 12 years

56% treat “Existing Customer Renewals” as high priority

Three uses for the SaaS Guidelines

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

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

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

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

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

More Growth Strategy Stats

Only 8% of large companies use internet sales strategies. The proportion of companies relying on internet sales increases as company size decreases

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

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

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

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

Analysed 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

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

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

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

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

September 19, 2019 Seminar

Driving Traffic To Generate Leads: Content Marketing, Paid Ads & SEO

If your business if starving for new leads but struggling with all of the noise, rising costs, and a rapidly changing landscape of the digital marketing world, this seminar will equip you with what you need to gain momentum and leave with an actionable gameplan.


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