Median annual gross dollar churn was 8%, 7%, 6% and 8% in 2016, 2015, 2014 and 2013

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.

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SaaS + Software Stats

• Customer Segmentation analysis will help point out which are your most profitable segments
• High-growth companies generate 60% fewer sales opportunities than low-growth companies
• The median SaaS business loses about 10% of its revenue to churn each year and that works out to about 0.83% revenue churn a month
• High-growth companies offer a return to shareholders 5 times greater than medium-growth companies
• SaaS organizations are now operating in over 100 countries
• Analysed by contract value, field sales are primarily evident for companies with median deals over $25K. Inside sales strategies are most popular for companies with $1K-$25K median deal sizes
• Getting paid in advance is really smart idea if you can do it without impacting bookings, as it can provide the cash flow that you need to cover your cash problem
• Best-in-class SaaS companies achieve 5-7% annual revenue churn – equivalent to a loss of $1 out of every $200 each month
• 26% of SAAS companies with at least $15MM in 2015 GAAP revenue had a revenue growth rate + EBITDA margin of 40% or higher.

SaaS & Tech Growth Strategy Stats

• The very best SAAS business has a negative churn rate and will have a Dollar Retention Rate of greater than 100%
• 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.
• At a 35% CAGR, it takes 10 years for a SaaS company to grow from $5M to $100M in ARR
• The very best SaaS businesses have a negative revenue churn rate and will have a Revenue Retention Rate of greater than 100%
• Internet Sales strategies have a significantly lower CAC of just $0.42
• The median average contract length is 1.3 years and the average billing term is seven months in advance in 2016. Comparable to 2015, with average contract length shortening from 1.5 to 1.3 years and average billing period increasing by one month from 2015 to 7 months
• Even if a software company is growing at 60% annually, its chances of becoming a multibillion-dollar giant are no better than 50/50
• The median SaaS business generates 16% of its new Annual Contract Value (ACV) from upselling to existing customers
• For SaaS companies valued at over $1billion, the median amount of financing raised is $206million