Statistic Info

There’s a lot to pay attention to when measuring the growth trajectory of your SaaS business. Are you increasing LTV while keeping CAC down? Is your customer acquisition rate greater than your customer churn rate? Do you distinguish between monthly recurring revenue and committed monthly recurring revenue?

Answering these questions is no easy task-SaaS metrics are extremely nuanced, and it can be hard to figure out exactly how to get the most complete and realistic understanding of your company’s growth, even if you have a few Harvard MBA’s on hand to model everything out.

InsightSquared

More SaaS + Software Stats

54% treat upselling and add-on sales as high priority

The fastest growing SaaS companies raise an average of $9.5M in Series A funding

Non-renewal rates are higher than gross dollar churn rates and higher for shorter duration contracts. Source: ForEntrepreneurs

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

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

How to Reduce Churn

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

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

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

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

More Growth Strategy Stats

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

General Dynamics is a market leader in the aerospace and defense industry. In 2018, a total of 105,600 people were working at General Dynamics.

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

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

In 2019, spending on IT services is expected to amount to 1,016 billion U.S. dollars worldwide

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

In contrast to these, the median annual churn rate for smaller, private SaaS companies with less than $10M in revenue is 20%

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

Revenue Churn Rate = (RCR) (MRR at beginning of month – MRR at end of month) – MRR in upgrades during month / MRR at beginning of month

Getting paid in advance is really smart idea if you can do it without impacting bookings, as it can provide the cash flow that you need to cover your cash problem