Statistic Info

To study churn, we need to look at a particular group of customers that signed up in a particular time period. We refer to these groups as cohorts. So you might have a Jan 2014 cohort which is comprised of all the customers that signed up in Jan 2014. We will then want to track how many customers we retain, and how the revenue for each cohort evolves over time. Here is a graph that shows what happens to the number of customers in a particular cohort over several years with three different monthly Customer Churn Rates.

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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

High-growth companies offer a return to shareholders 5 times greater than medium-growth companies

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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

SAAS companies that are focused mainly on enterprise sales have higher levels of professional services

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

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

To generate a single dollar of new customer revenue, Field Sales strategies have an average Customer Acquisition Cost (CAC) of $1.14

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

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

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

How To Make Pricing A Constant Process In Your Organization

When venture capitalists participate in seed rounds, the average round size is 3x larger

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

26% of SAAS companies with at least $15MM in 2015 GAAP revenue had a revenue growth rate + EBITDA margin of 40% or higher

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

Software and online services are in a period of dizzying growth

SAAS companies invest between 80% and 120% of their revenue in sales and marketing in the first 5 years of their existence