Cloud-hosted applications have a 99% uptime

Quote in SaaS & Tech Growth Strategy

If a service provider is offering 99 percent uptime, that’s 2 nines of uptime. It’s really telling its customers that, on average, they’ll experience just over 7 hours of downtime in any given month. Is that enough? It depends; it might be good enough for workloads that aren’t critical to enterprise survival, but it’s woefully lacking for critical workloads.

But what exactly does Microsoft’s “99.9-plus” percent uptime statement mean — 99.9001 or 99.999? There’s a huge difference. Let’s do some quick math:





For many businesses, I guess 99.9% uptime is quite good.

More SaaS + Software Stats

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

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

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

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

55% of SaaS companies rate Customer Retention as the key metric to measure

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

56% treat “Existing Customer Renewals” as high priority

SaaS IPOs have more than doubled over the last 12 years

SaaS companies in the $7.5MM-$15MM range are among the fastest growers

Even if a software company is growing at 60% annually, its chances of becoming a multibillion-dollar giant are no better than 50/50

More SaaS & Tech Growth Strategy Stats

Net-revenue churn improves with larger Average Contract Value (ACV), likely due to more structural churn among SMB customers and higher switching costs associated with larger contracts

In 2017, IBM generated 37.8 billion U.S. dollars in global IT services revenue, making it the largest IT services company in the world in terms of net sales

If you are charging $500 per month, you can afford to spend up to 12x that amount (i.e. $6,000) on acquiring a new customer

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

Japanese company Hitachi accounted for three percent of the world’s market for diagnostic imaging in 2017.

73% of organizations indicated nearly all their apps will be SaaS by 2021

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

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

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

In 2018, the U.S. imported aerospace products worth about 53.98 billion U.S. dollars.