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

Statistic Info

Respondents (excluding the smallest companies) spent a median $1.13 to acquire each dollar of new ACV from a new customer. The result drops to $1.00 if we include companies with <$2.5MM in revenues. The median spend to acquire each dollar of new ACV from a new customer this year is similar to last year’s result of $1.18.

Note to regular ForEntrepreneurs readers: The way CAC is measured here is different than how I normally measure CAC (see SaaS Metrics 2.0 –  A Guide to Measuring and Improving What Matters). In those posts CAC is the average amount that it costs to acquire a single customer. In this survey, CAC is measured as the cost to acquire a dollar of ACV (annualized contract value).

More SaaS + Software Stats

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

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

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

The top 50% of the fastest growing SaaS businesses generate much higher upsells than their competitors. The larger the business, the greater the impact of upselling

Negative Churn and Expansion Revenue

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%

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

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

To establish a revenue or lead-commitment based on your funnel metrics and revenue-growth goals, work backward from the gross revenue amount that marketing is responsible for generating (generally around 40%)

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

More Growth Strategy Stats

Women in western countries use the internet 17 percent more than their male counterparts

Gross dollar churn among companies with an internet go-to-market strategy saw a meaningful increase, up from 8% in 2015

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

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

As of December 2018, there were total 105,000 employees in Lockheed Martin, as compared to 126,000 employees in 2015.

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

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

How Often Should The Pricing Committee Be Meeting And Making Changes?

It’s essential to have a point of view that puts a stake in the ground and breaks through the clutter.

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