Statistic Info

An acceptable churn rate is in the 5 – 7% range ANNUALLY, depending upon whether you measure customers or revenue.

And BVP’s assertion is backed up by Pacific Crest in their Private SaaS Company Survey Results that show roughly 70% of SaaS companies in their survey had annual churn in the < 10% range, with 75% of those at 5% or under.

The way I read the results of Pacific Crest’s survey is that 30% of SaaS providers surveyed have an unacceptable level of churn.

Now what about the SaaS providers that aren’t included in surveys like that one or who don’t appear in the logo list of the top investor portfolios and who are just trying to grow? Are they doing better or worse?

In my experience, it’s quite often worse� and sometimes much worse (as you’ll see in a second).

Honestly, for those companies, it isn’t a lack of customers in the front door that is stopping their growth; it’s the constant flow of customers out the back door that is killing their business!

sixteenventures.com

More SaaS + Software Stats

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

Gross dollar churn among companies with an internet go-to-market strategy saw a meaningful increase, up from 8% in 2015

If a software company grows at 20% annually, it has a 92% chance of ceasing to exist within a few years

The fastest growing SaaS companies scale their organizations rapidly, growing their teams by an average of 56% each year

Internet Sales strategies have a significantly lower CAC of just $0.42

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

55% of SaaS companies rate Customer Retention as the key metric to measure

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

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%

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

More Growth Strategy Stats

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

Google only has a 30 percent female workforce

80% of venture capital investments take place in the enterprise

In 2018, the revenue of General Dynamics amounted to nearly 36.2 billion U.S. dollars.

Software and online services are in a period of dizzying growth

How Often Should The Pricing Committee Be Meeting And Making Changes?

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

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

A University of Texas study showed that women ask for $7,000 less than their male counterparts in job interviews

54% treat upselling and add-on sales as high priority