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

Quote Info

The phenomenon of longer contract terms for larger contracts is pretty clear. Companies in the “elephant hunter” group are less aggressively booking super long-term contracts. Respondents with >$250K median ACV book nearly 25% of their contracts at 3 years or longer (down from 35% in the 2015 group).

More SaaS + Software Stats

Negative Churn and Expansion Revenue

Moving from $1.5 million with an eye towards $10 million in ARR is a tough a task and will take an excellent VP of sales to get you there

The median SaaS business loses about 10% of its revenue to churn each year and that works out to about 0.83% revenue churn a month

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

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

How to Reduce Churn

The best SAAS businesses have a LTV to CAC ratio that is higher than 3, sometimes as high as 7 or 8

Analysed by contract value, field sales are primarily evident for companies with median deals over $25K. Inside sales strategies are most popular for companies with $1K-$25K median deal sizes

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

SaaS IPOs have more than doubled over the last 12 years

More Growth Strategy Stats

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%

Median annual gross dollar churn was 8%, 7%, 6% and 8% in 2016, 2015, 2014 and 2013

The very best SaaS businesses have a negative revenue churn rate and will have a Revenue Retention Rate of greater than 100%

Moving from $1.5 million with an eye towards $10 million in ARR is a tough a task and will take an excellent VP of sales to get you there

36% of SaaS businesses managed to reduce their revenue churn over the last 12-months

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

51% of large (revenue >$2.5million) SaaS companies use field sales as their primary method of distribution

in 2016, women-led companies received $1.46 billion in investments from venture capitalists. Male-led companies, on the other hand, received $58.2 billion

SAAS companies need to track the number of visitors, trials and closed deals; And also track the conversion rates, with the goal of improving those over time

The median monthly revenue churn for large SaaS companies is 0.75%, translating into an annual revenue churn rate of 10%