Quote Info

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.

For Entrepreneurs.com

More SaaS + Software Stats

Is your SaaS business viable?

All types of investment have grown, year-on-year, with the biggest growth during the seed stage of financing

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

26% of SAAS companies with at least $15MM in 2015 GAAP revenue had a revenue growth rate + EBITDA margin of 40% or higher

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

Smaller SAAS companies reported more frequent use of third-party providers as their primary application delivery method, while the largest companies were more likely to use self-managed servers

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

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

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

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

More Growth Strategy Stats

Companies with longer contracts (2+ years) reported the lowest annual unit churn

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

High-growth companies generate 60% fewer sales opportunities than low-growth companies

More than 1/2 of SAAS companies increased their spending on customer retention last year

The fastest growing SaaS companies scale their organizations rapidly, growing their teams by an average of 56% each year

After $10M in ARR, the median growth rate slows to just under 50%

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

If your Net Revenue Churn is high (above 2% per month) it is an indicator that there is something wrong in your business; this will become a major drag on growth

In 2018, the revenue of General Dynamics amounted to nearly 36.2 billion U.S. dollars.

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