Quote Info

Year-old companies are turning down billion-dollar buyouts in the hopes of multibillions in a few months. But we have seen similar industry phases before, and they have often ended with growth and valuations fizzling out. The industry’s booms and busts make growth, an essential ingredient in value creation, difficult to understand. To date, little empirical work has been done on the importance of revenue growth for software and Internet-services companies or how to find new sources of growth when old ones run out.

Mckinsey

More SaaS + Software Stats

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

The median annual unit churn for SAAS companies was 10% in 2016

Improve Your Pricing Schedule And Turn More Profit

If the numerator of your quick ratio is growing that means your revenue is growing. It’s important to keep increasing revenue to counter any MRR (Monthly Recurring Revenue) that is lost to churn

If your Net Revenue Churn is high (above 2% per month) it is an indicator that there is something wrong in your business

Since churn is so important, wouldn’t it be useful if we could predict in advance which customers were most likely to churn?

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

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

The average SaaS business generates 16% of its new Annual Contract Value (ACV) from upselling to existing customers

SAAS companies that are focused mainly on enterprise sales have higher levels of professional services

More Growth Strategy Stats

80% of venture capital investments take place in the enterprise

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

In 2017, IBM generated 37.8 billion U.S. dollars in global IT services revenue, making it the largest IT services company in the world in terms of net sales

47% of millennials want to work at diverse companies, according to a recent study.

Google only has a 30 percent female workforce

The median TTM revenue growth rate + adj. EBITDA margin for publicly traded SaaS companies was ~37%, implying that just under one half met or exceed “The Rule of 40%”

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

Is your SaaS business viable?

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

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