SAAS companies with >$250K median ACV book nearly 25% of their contracts at 3 years or longer

Statistic Info

The median annual contract size (subscription component only) for the group was $25K per year. These results are somewhat above the previous survey medians of $21K, $21K, $20K in 2015, 2014 and 2013, respectively.

The median average contract length is 1.3 years. The median billing term is seven months in advance. These results are very comparable to 2015, with average contract length shortening from 1.5 to 1.3 years and average billing period increasing one month over 2015 to seven months.

More SaaS + Software Stats

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

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

When determining Sales Capacity, “it’s worth noting that some percentage of new sales hires won’t meet expectations, so that should be taken into consideration when setting hiring goals. Typically we have seen failure rates around 25-30% for field sales reps, but this varies by company. The failure rate is lower for inside sales reps. can be counted as half of a productive rep”

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

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

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

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

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

Achieving a SaaS Quick Ratio of 4 is a good benchmark for young, high-growth companies but the equation changes as those companies reach scale

More Growth Strategy Stats

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

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

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

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.

26% of SAAS companies with at least $15MM in GAAP revenue had a revenue growth rate + EBITDA margin of 40% or higher.

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

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

In 2018, the U.S. imported aerospace products worth about 53.98 billion U.S. dollars.

The very best SAAS business has a negative churn rate and will have a Dollar Retention Rate of greater than 100%

At Twitter, 10 percent of tech roles are staffed by women