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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.

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More SaaS + Software Stats

To generate a single dollar of new customer revenue, Field Sales strategies have an average Customer Acquisition Cost (CAC) of $1.14

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%

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

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

For a SaaS business of almost any scale, the valuation impact of better retention is in the tens of millions over time

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

The median 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; which may have a dramatically negative effect on your company’s growth. Source: Mckinsey

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

Because of the losses in the early days, which get bigger the more successful the company is at acquiring customers, it is much harder for management and investors to figure out whether a SaaS business is financially viable.

More Growth Strategy Stats

Japanese company Hitachi accounted for three percent of the world’s market for diagnostic imaging in 2017.

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

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

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

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The very best SAAS companies keep monthly revenue churn at around 0.58%, that’s only about 7% revenue churn a year

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

The 2015 median revenue growth rate was 44%, while the median projected growth rate for 2016 is 48%

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

A 2017 SaaS Capital survey showed that young companies actually have higher retention rates than more mature SaaS businesses