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

From For Entrepreneurs.com
Statistic in SaaS & Tech Growth Strategy

At 2% monthly churn, you are losing about 22% of your revenue every year. That is nearly a quarter of your revenue! It’s a clear indication that there is something wrong with the business. As the business gets bigger, this will become a major drag on growth.

We recommend that you work on fixing the problems that are causing this before you go on to worry about other parts of your business. Some of the possible causes of churn are:

The best way to find out why customers are churning is to get on the phone with them and ask them. If churn is a significant part of your business, we recommend that the founders themselves make these calls. They need to hear first hand what the problem is, as this is so important for the success of the business. And they are likely to be the best people to design a fix for the problem.

More SaaS + Software Stats

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

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

The median Customer Acquisition Cost (CAC) for upsells is just $0.28 per $1, less than a quarter of the $1.18 spent to acquire $1 of revenue from a new customer

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

Software and online services are in a period of dizzying growth

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

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

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

Customer Acquisition Cost (CAC) = sum of all sales & marketing expenses/ number of new customers added

More SaaS & Tech Growth Strategy Stats

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

SAAS companies invest between 80% and 120% of their revenue in sales and marketing in the first 5 years of their existence

At Twitter, 10 percent of tech roles are staffed by women

High-growth companies offer a return to shareholders 5 times greater than medium-growth companies

To generate a single dollar of new customer revenue, Field Sales strategies have an average Customer Acquisition Cost (CAC) of $1.14

The metrics that matter for each sales funnel, vary from one company to the next depending on the steps involved in the funnel

Because of the losses in the early days, which get bigger the more successful the company is at acquiring customers, it is much harder for management and investors to figure out whether a SaaS business is financially viable.

How To Make Pricing A Constant Process In Your Organization

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.

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