Statistic Info

They are, in other words, exactly the type of SaaS startup that you should look for when deciding where to invest.

And, as their high Quick Ratio implies, they have a great chance to continue growing quickly and healthfully, and eventually become one of those fabled SaaS companies with a run rate of more than $10 million.

InsightSquared

More SaaS + Software Stats

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

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

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

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

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

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

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

Our experiences with SaaS startups indicate that they usually start with a couple of lead generation programs such as Pay Per Click Google Ad-words, radio ads, etc

Increases in revenue growth rates drive twice as much market-capitalisation gain as margin improvements for companies with less than $4 billion in revenues

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%

More Growth Strategy Stats

In 2017, Foxconn Technology Group achieved revenue of 158.15 billion U.S. dollars.

For SaaS companies valued at over $1billion, the median amount of financing raised is $206million

Customer Acquisition Cost (CAC) = sum of all sales & marketing expenses/ number of new customers added

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

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

It’s 9x cheaper to retain existing customers than acquire new customers: costing $0.13 to acquire any additional dollar of revenue

Growth rate accelerates in the expansion stage ($2.5M – $10M ARR)

The median average contract length is 1.3 years and the average billing term is seven months in advance in 2016. Comparable to 2015, with average contract length shortening from 1.5 to 1.3 years and average billing period increasing by one month from 2015 to 7 months

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

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