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

From Chaotic Flow
Statistic in SaaS & Tech Growth Strategy

SaaS companies vary a lot in their willingness to invest in customer acquisition. For example, the OPEXEngine SaaS benchmark report gives an average payback period for CAC alone of about 18 months (CAC per new customer divided by average recurring revenue per customer). However, SasS companies with expected growth rates in the 20-50% range had a payback period of only 6.5 months, while those with expected growth rates over 50% had an average payback period of….drum roll….35 months! Ouch. While it makes sense to invest heavily in customer acquisition during high growth, SaaS Metrics Rule of Thumb #6 | Growth Creates Pressure to Reduce Total Cost of Service, highlights the importance of keeping average CAC per customer in check as you grow. Even if you’re angling toward an IPO with a churn rate under 10%, I think it’s near impossible to justify a 3 year payback period just to cover CAC. Talk about negative cash flow!!

More SaaS + Software Stats

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

Cloud-hosted applications have a 99% uptime

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

The 2015 median revenue growth rate was 44%, while the median projected growth rate for 2016 is 48%

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

Negative Churn and Expansion Revenue

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

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.

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

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

More SaaS & Tech Growth Strategy Stats

The largest SaaS companies (>$75million yearly revenue) attribute 2.5x as much new revenue to upselling than the smallest SaaS companies (<$1.25million): 28% versus 11%

How To Make Pricing A Constant Process In Your Organization

Improve Your Pricing Schedule And Turn More Profit

Gross dollar churn among companies with an internet go-to-market strategy saw a meaningful increase, up from 8% in 2015

The median cost for a SaaS company to acquire a dollar of new customer revenue is $1.18

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

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

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

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

The best SaaS companies achieve 5-7% annual revenue churn – equivalent to a loss of $1 out of every $200 each month