The average company booking professional services revenue on new deals is equivalent to 16% of the first year subscription value. Professional services margins are approximately 22%

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Professional services play a minor role for most companies, with the median company booking P.S. revenues on new deals equivalent to 16% of first year subscription contract value. Median P.S. margins are approximately 22%. These results are consistent with last year’s results.

More SaaS + Software Stats

55% of SaaS companies rate Customer Retention as the key metric to measure

Unlike many other industries, if a software company grows at only 20%, it has a 92% chance of ceasing to exist within a few years

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

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

The fastest growing SAAS companies averaged $250k in MRR and were only losing around 3.2% of that revenue each month to churn

SaaS, and other recurring revenue businesses are different because the revenue for the service comes over an extended period of time (the customer lifetime)

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

SaaS IPOs have more than doubled over the last 12 years

Is your SaaS business viable?

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

More Growth Strategy Stats

Best-in-class SaaS companies achieve 5-7% annual revenue churn – equivalent to a loss of $1 out of every $200 each month

The average company gets 16% of new ACV sales from up-sells and expansions, though companies with revenue between $10MM-$40MM are relying more heavily on up-sell and expansions

Improve Your Pricing Schedule And Turn More Profit

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

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

Three uses for the SaaS Guidelines

They may forget what you said, but they will never forget how you made them feel.

Internet Sales strategies have a significantly lower CAC of just $0.42

While field sales remains the most popular way to sell for companies >$2.5MM revenue, companies with <$2.5MM revenue tended to use inside sales as their primary mode of distribution

In contrast to these, the median annual churn rate for smaller, private SaaS companies with less than $10M in revenue is 20%