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

The median result is notably higher than compared to previous surveys, where the $1.07 and $0.92 were reported in the 2014 and 2013, respectively. Respondents (excluding the smallest companies) spent a median of $1.18 to acquire each dollar of new ACV from a new customer. The result drops to $1.06 if we include companies with <$2.5MM in revenues.

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SaaS + Software Stats

• After $10M in ARR, the median growth rate slows to just under 50%
• 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.
• Revenue Churn Rate = (RCR) (MRR at beginning of month – MRR at end of month) – MRR in upgrades during month / MRR at beginning of month
• Publicly-traded SaaS companies have an average Revenue Per Employee of $200,000
• Between the SMB and Enterprise customer types, the top-quartile performers not only have net-revenue churn that is 14% to 23% percentage less than the average performers but also have net-revenue churn that is negative in an absolute sense
• 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
• Median annual gross dollar churn was 8%, 7%, 6% and 8% in 2016, 2015, 2014 and 2013
• SAAS companies with >$250K median ACV book nearly 25% of their contracts at 3 years or longer
• The average SaaS business generates 16% of its new Annual Contract Value (ACV) from upselling to existing customers

Market Research Stats

• 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%)
• In 2018, the U.S. imported aerospace products worth about 53.98 billion U.S. dollars.
• Revenue Churn Rate = (RCR) (MRR at beginning of month – MRR at end of month) – MRR in upgrades during month / MRR at beginning of month
• 54% treat upselling and add-on sales as high priority
• Cloud application services are expected to grow at an average annual rate of 18.5% through 2025
• The average SaaS business generates 16% of its new Annual Contract Value (ACV) from upselling to existing customers
• 86% of SaaS businesses treat “New Customer Acquisition” as their highest growth priority, both in terms of executive support and funding available
• 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%
• 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