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

Statistic Info

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.

More SaaS + Software Stats

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

In 2017, IBM generated 37.8 billion U.S. dollars in global IT services revenue, making it the largest IT services company in the world in terms of net sales

High-growth companies are 8X more likely to reach $1 billion in revenues than those growing less than 20%.

Software and online services are in a period of dizzying growth

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

SaaS businesses face significant losses in the early years (and often an associated cash flow problem)

Since churn is so important, wouldn’t it be useful if we could predict in advance which customers were most likely to churn?

The median annual unit churn for SAAS companies was 10% in 2016

When determining Sales Capacity, “it’s worth noting that some percentage of new sales hires won’t meet expectations, so that should be taken into consideration when setting hiring goals. Typically we have seen failure rates around 25-30% for field sales reps, but this varies by company. The failure rate is lower for inside sales reps. can be counted as half of a productive rep”

Best-in-class SaaS companies achieve 5-7% annual revenue churn – equivalent to a loss of $1 out of every $200 each month

More Growth Strategy Stats

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

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

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

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

As with unit churn, companies with longer contracts (2+ years) tend to report lower annual dollar churn

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

Best-in-class SaaS companies achieve 5-7% annual revenue churn – equivalent to a loss of $1 out of every $200 each month

Non-renewal rates are higher than gross dollar churn rates and higher for shorter duration contracts. Source: ForEntrepreneurs

In 2020, China is expected to generate 55 billion U.S. dollars in the global medical technology market.

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