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

Statistic Info

The most significant changes this year include: 1) Upsells: this year just 45% paid full commission rates on upsells, vs. 58% in last year’s group; 2) This year just 32% paid no additional commission on longer term contracts vs. 42% in last year’s group. Not surprisingly, commissions on renewals are typically deeply discounted, with a median rate of 2%. Upsells command a median rate of 8%, and nearly half of the companies pay full commissions on upsells.

More SaaS + Software Stats

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

Growing faster has twice as much impact on share price as improving margins

Account Churn Rate (ACR) = customers at beginning of month – customers at the end of month / customers at beginning of month

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

Moving from $1.5 million with an eye towards $10 million in ARR is a tough a task and will take an excellent VP of sales to get you there

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

The fastest growing SAAS companies averaged $250k in MRR and were only losing around 3.2% of that revenue each month to churn

Customer’s lifetime value (LTV)= average revenue per user (ARPU) / monthly churn rate

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

56% treat “Existing Customer Renewals” as high priority

More Growth Strategy Stats

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

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

In 2017, Foxconn Technology Group achieved revenue of 158.15 billion U.S. dollars.

How To Make Pricing A Constant Process In Your Organization

Three uses for the SaaS Guidelines

86% of SaaS businesses treat “New Customer Acquisition” as their highest growth priority, both in terms of executive support and funding available

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

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.

Revenue Renewal Rate= (MRR up for the renewal at beginning of month- MRR not renewed at the end of month)/ MRR up for renewal at beginning of month)

56% treat “Existing Customer Renewals” as high priority