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This is because they have to invest heavily upfront to acquire the customer, but recover the profits from that investment over a long period of time. The faster the business decides to grow, the worse the losses become. Many investors/board members have a problem understanding this, and want to hit the brakes at precisely the moment when they should be hitting the accelerator.

In many SaaS businesses, this also translates into a cash flow problem, as they may only be able to get the customer to pay them month by month.

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More SaaS + Software Stats

The statistic shows the worldwide IT spending on enterprise software from 2009 to 2020.

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

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

Between the SMB and Enterprise customer types, the top-quartile performers not only have net-revenue churn that is 14% to 23% percentage less than the average performers but also have net-revenue churn that is negative in an absolute sense

In all SaaS businesses there will likely come a moment where they realize that not all customers are created equal

SAAS companies invest between 80% and 120% of their revenue in sales and marketing in the first 5 years of their existence

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%

More than two thirds of SAAS companies experienced annual churn rates of 5% or higher

High-growth companies offer a return to shareholders 5 times greater than medium-growth companies

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

More Growth Strategy Stats

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

orecasts suggest that global blockchain technology revenues will experience massive growth in the coming years, with the market expected to climb to over 23.3 billion U.S. dollars in size by 2023.

Less than 20% of new revenue came from existing customers in the form of up-sell and expansion sales

In 2018, the global tech spending is forecast to amount to 3,212 billion U.S. dollars.

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

Customer Segmentation analysis will help point out which are your most profitable segments

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

In 2017, Foxconn Technology Group achieved a net income of 135.37 billion New Taiwanese dollars, the equivalent to approximately 4.55 billion U.S. dollars.

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

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