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As with unit churn, companies with longer contracts (2+ years) tend to report lower annual dollar churn. Companies with shorter contracts (under 2 years) saw increased dollar churn compared to last year; contracts 2 years or longer were relatively consistent with prior survey results.

By definition, non-renewal rates are higher than gross dollar churn rates. However, it is interesting to see that the non-renewal rates are also higher for shorter duration contracts.

For Entrepreneurs.com

More SaaS + Software Stats

At a 35% CAGR, it takes 10 years for a SaaS company to grow from $5M to $100M in ARR

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

The very best SaaS businesses have a negative revenue churn rate and will have a Revenue Retention Rate of greater than 100%

High-growth companies are 8X more likely to reach $1 billion in revenues than those growing less than 20%.

Internet sales-driven companies have a much greater reliance on marketing, with 65% of the median company’s CAC budget devoted to marketing

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

When venture capitalists participate in seed rounds, the average round size is 3x larger

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

If your Net Revenue Churn is high (above 2% per month) it is an indicator that there is something wrong in your business; which may have a dramatically negative effect on your company’s growth. Source: Mckinsey

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

More Growth Strategy Stats

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

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

It’s common for startups to grow rapidly, doubling or tripling in size year over year, until they hit $5M in ARR

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

The median annual contract value (ACV) was $25K, $21K, $21K, $20K in 2016, 2015, 2014 and 2013

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

When venture capitalists participate in seed rounds, the average round size is 3x larger

Three uses for the SaaS Guidelines

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

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