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Compared with previous surveys, field sales lagged inside sales by a greater amount this year (6% in 2015 vs. an insignificant 2% difference in 2014). Median growth among field sales dominated companies slightly lagged inside sales dominated companies (by 6% points), but led internet sales by 8% points. Channel sales dominated companies grew significantly faster, though the data is sparse. Mixed also performed well.

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More SaaS + Software Stats

The best SAAS businesses have a LTV to CAC ratio that is higher than 3, sometimes as high as 7 or 8

Unlike many other industries, if a software company grows at only 20%, it has a 92% chance of ceasing to exist within a few years

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

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

Investment in marketing automation tools is expected to reach $25 billion by the year 2023

SAAS companies with >$250K median ACV book nearly 25% of their contracts at 3 years or longer

How Often Should The Pricing Committee Be Meeting And Making Changes?

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

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

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

More Growth Strategy Stats

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

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

The median annual unit churn for SAAS companies was 10% in 2016

Companies that spend more on sales and marketing (as a % of revenue) generally grew at a faster rate than those that spent less

After $10M in ARR, the median growth rate slows to just under 50%

The best SAAS businesses have a LTV to CAC ratio that is higher than 3, sometimes as high as 7 or 8

Improve Your Pricing Schedule And Turn More Profit

SAAS companies with >$250K median ACV book nearly 25% of their contracts at 3 years or longer

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

Three uses for the SaaS Guidelines