SaaStr

APRIL 4, 2023

You’ll probably have a smaller lifetime customer value and customer budget for acquisition. Find The Balance Between CAC And LTV The achievable lifetime value defines your customer acquisition cost target. Every company is different and will have varying solutions, customer acquisition costs, and lifetime value.

Scale 231

Scale Scaling Strategy Outbound Sales Team 231

SaaStr

NOVEMBER 4, 2021

2 drivers stood out as notable: Customer Acquisition Cost (CAC) and Churn. In terms of Customer Acquisition Costs, “Rule of 40” Qualifiers spent 31% less to acquire a new customer. In terms of Churn, “Rule of 40″ Qualifiers” had 29% lower Gross Dollar Churn. After all, 31% + 29% = 60%.

SaaS 264

SaaS Technical Review Benchmarks Azure 264

SaaStr

JANUARY 24, 2024

How do you diagnose and solve churn? So, Dini came in, looked at the data around churn and usage, talked to customers, defined and narrowed Lattice’s core ICP, and made a few changes: They put a minimum in place not to sell to anyone under $4k. So, Calendly decided to invest in going Enterprise.

Scale 228

Scale Sales Hiring Scaling Revenue 228

ChurnZero

SEPTEMBER 16, 2022

When a financial slowdown approaches, the smartest businesses look for areas where their investment has the best leverage. In good times, a lot of investments that a company makes are really focused on new sales. Focus on your customers’ top three churn risks. Talent acquisition is way more interesting and way better.

Customer Success 98

Customer Success Investment Churn Retention 98

Totango

JANUARY 26, 2021

Being proactive about churn prevention provides an antidote to customer attrition. Read on to learn what churn is, how an attrition analysis can help you pinpoint why you’re losing customers, and what steps you can take to prevent customer churn. What Is Churn Rate and How Does It Relate to Customer Retention?

Churn 89

Churn Retention Underperforming Technical Team Technical Review 89

SaaSOptics

MAY 19, 2022

What Is Customer Acquisition? Customer Acquisition is the process of acquiring new customers in a business. For subscription-based SaaS businesses, your customer acquisition metrics indicate how effectively you acquire new users via sales, marketing, or a product-led approach like a free trial. More customers = more revenue.

Acquisition 59

Acquisition Scale Strategy Software Review 59

SaaStr

FEBRUARY 17, 2023

While the allure of customer acquisition can pull a founder’s attention, it’s equally important to dedicate resources to fighting churn and expanding revenue from existing customers. They discuss how Fox helped build a churn-fighting, upselling, and cross-selling machine that continues to generate revenue.

Retention 212

Retention Revenue Startup Sales Hiring 212

Sixteen Ventures

SEPTEMBER 10, 2020

It’s critical to understand why your customers churn, but if you’re relying solely on the reason the customer gives you for that churn, you’re definitely missing the actual reason. It’s easy, but it’s not going to get you the answer you need to keep future churn from happening. Churn: Syntax and Nomenclature.

Churn 131

Churn Customer Success Systems Review Outsourced Development 131

Tom Tunguz

NOVEMBER 6, 2021

All of the sales and marketing dollars invested to obtain persuade the buyer to put digital ink to pdf have been recouped immediately. And the company has two years of marginal profit to invest in the GTM. Especially if logo churn is low, account expansion is strong, and the sales cycles are brief.

Sales Hiring 309

Sales Hiring Scale Payments Payment Solutions 309

Totango

DECEMBER 1, 2020

A high churn rate can reflect poorly on your enterprise and require you to invest more in customer acquisition; retention efforts are far less costly and often provide more positive results. In order to properly prevent customer churn, it’s crucial to understand the common factors that lead to churn in the first place. .

Churn 65

Churn Systems Review Onboarding Trends 65

SaaStr

SEPTEMBER 17, 2023

The Next Best in About 5 Years. 5 Interesting Learnings from Samsara At Almost $1 Billion in ARR Top Podcasts This Week: 1.

Scale 217

Scale Management SMB AI 217

User Pilot

OCTOBER 5, 2023

TL;DR The CAC payback period measures the time it takes for a company to recover the money invested in new customer acquisition. This metric helps SaaS companies choose the most effective customer acquisition channels , diagnose inefficiencies in customer retention strategies , and inform pricing decisions.

SaaS Payments 105

SaaS Payments Customer Lifetime Value Payment Solutions Acquisition 105

Chart Mogul

JULY 8, 2020

Tired of the same ol’ “X proven ways to reduce customer churn”? SaaS companies dedicate a lot of time and money to the same goal — they want to give customers a reason to stay and reduce churn. But no matter what that personality is for your brand, it’s consistency that counts for reducing customer churn. Click To Tweet.

Branding 133

Branding Churn Underperforming Technical Team Retention 133

User Pilot

MARCH 25, 2024

Revenue-based valuations are more suitable for SaaS startups because it doesn’t take into account upfront investment which affects SDE or EBITDA negatively. As this investment is expensed in SDE/EBITDA, the metrics often equal zero. EBITDA is used by larger companies with more complex management structures.

SaaS 105

SaaS Customer Lifetime Value Acquisition Metrics 105

SaaStr

NOVEMBER 2, 2021

Yes, this customer churned after 11 years. But it was a reluctant churn. While this particular deal was nominally due to a feature gap (a material one in this case), the reality is it happened after an acquisition. In that gap, customers with champion change churn. So start investing longer. If we hadn’t?

Scale 290

Scale Churn Retention Acquisition 290

Clouded Judgement

MARCH 22, 2024

At contract expiration these customers either renew (sign another contract with same annual value), expand (sign another contract with higher annual value), contract (sign another contract with lower annual value), or churn (stop being a customer and spend goes to zero). Altimeter is an investment adviser registered with the U.S.

AI 183

AI Revenue Cloud Technical Advisors 183

Chart Mogul

AUGUST 20, 2020

4x entrepreneur Andrew Gazdecki shares how you can better prepare yourself for your startup's acquisition, and make the journey a rewarding one. The better prepared you are for an acquisition, the smoother it’ll go, leaving you financially, operationally, and psychologically stronger during negotiations. Know your numbers.

Acquisition 52

Acquisition Startup Technical Review Scale 52

SaaStr

APRIL 1, 2022

Mistake #1: Being Risk-Averse to Investments Outside of Your Area of Expertise. Schuck felt that he could more easily see the results in immediate dollars when he invested in sales. However, when you withhold investment from specific teams, it might reveal a more serious problem with your trust in teams or your product.

Sales Hiring 230

Sales Hiring Acquisition Investment Leadership 230

CustomerSuccessBox

JUNE 8, 2022

The capacity to forecast that a specific customer is at a high risk of churning while there is still time to do something about it is a major new possible revenue generator for any company. We, at CustomerSuccessBox , spoke to some of the Top Customer Success Influencers to know how they manage churn! Q: Please introduce yourself.

Churn 52

Churn Management Systems Review Onboarding 52

Clouded Judgement

APRIL 11, 2024

The first few months of this year felt like a lot of churning in the market. It is calculated by taking the annual recurring revenue of a cohort of customers from 1 year ago, and comparing it to the current annual recurring revenue of that same set of customers (even if you experienced churn). net retention and CAC payback).

Cloud 169

Cloud Software Azure AWS 169

SaaStr

DECEMBER 29, 2019

Some take-aways: If You Truly Have Net Negative Churn and High NPS — Then Almost Any Reasonable CAC Makes Sense. But you have to have insane NPS/CSAT + truly high net negative churn (120%-140%) for this math to really work. Customers invest in not just products, but relationships. Invest like that. Measure NPS.

Scale 347

Scale Churn Construction SMB 347

User Pilot

FEBRUARY 28, 2024

There are various metrics to track the customer path, such as: Awareness stage metrics Acquisition stage metrics Activation stage metrics Adoption stage metrics Retention stage metrics Revenue stage metrics Referral stage metrics To create a successful customer path, follow the steps below: Conduct user path analysis to identify the happy path.

Customer Lifetime Value 105

Customer Lifetime Value SaaS Software Review Acquisition 105

Totango

JANUARY 22, 2024

In fact, 63% of CAB members said their top 2024 prediction was that businesses would put more strategic and bottom-line emphasis on expansion versus acquisition to drive revenue growth. Retention is the new acquisition. Most expect to see CS emerging as a growth engine. Additionally, our CAB members are buzzing about AI.

Customer Success 94

Customer Success Generative AI AI Scale 94

Intercom, Inc.

AUGUST 23, 2022

Shifting focus to customer retention can actually be twice as powerful as customer acquisition. While a 1% increase in acquisition might boost your bottom line by about 3% , a 1% decrease in churn can boost it by 7% ! That’s why companies should look to support – and retain – the customers they have.

Customer Support 211

Customer Support Retention Headcount Customer Lifetime Value 211

Tom Tunguz

OCTOBER 30, 2013

Every SaaS business suffers from churn. If churn isn’t managed properly, the lost revenue from churned customers offsets new revenue and the business flat-lines or suffers negative revenue growth. Each strategy requires different levels of investment but achieves similar results. Revenue Churn as %.

Churn 100

Churn Startup Strategy SaaS 100

Tom Tunguz

JANUARY 28, 2014

An entrepreneur asked me the question, what is the maximum viable churn for a startup? How should a founder think about trading off efforts to grow revenue and mitigate churn? What is the impact of account growth on net churn? Startups must walk a tight-rope to balance growth, churn and cash. Monthly Churn 2% 3% 4% 5%.

Churn 100

Churn Startup Acquisition Investment 100

SaaStr

FEBRUARY 9, 2024

So when’s the right time to invest more in sales and marketing when we’re all trying to become radically efficient ? So when you think about acquisition, retention, and expansion, they all revolve around the product capabilities in a PLG motion. The product becomes your sales team.

Scale 260

Scale Sales Hiring Sales Marketing 260

Totango

APRIL 30, 2021

Comparing the cost of customer retention versus customer acquisition underscores why retaining clients is so important. Calculating the Cost of Customer Acquisition. To calculate your average CAC, total up all the marketing and sales costs that go into your acquisition efforts for a given period. The result is your average CAC.

Acquisition 63

Acquisition Retention Social Media Advertising 63

SaaStr

JANUARY 22, 2021

A product-led growth strategy relies on the product itself as the primary vehicle for customer acquisition, conversion, retention, and expansion. The return on marketing investment is much faster. The churn rate becomes more predictable based on usage sentiment. Product-Led Growth: The Disruptive GTM Strategy.

Scale 265

Scale New CTO CTO User Experience 265

User Pilot

DECEMBER 23, 2023

It also explores: The difference between retention and churn The importance of tracking retention Various stages of user retention How to measure it effectively What retention metrics to track, and Tried and tested strategies to increase user retention. Churn is the opposite of retention. It’s how many users abandon the product.

Retention 104

Retention Customer Lifetime Value Social Media Churn 104

SaaStr

JANUARY 24, 2021

Well, it does make sense, when you understand the scenario, a combination of two things: First, this SaaS company has a mix of freemium customers and sales-driven customers (with higher ACV, lower churn). The freemium ones really have no acquisition costs at this point (the main lead source is mini-brand). Do that if you can.

Scale 336

Scale Sales Hiring Scaling Construction 336

ProfitWell

OCTOBER 16, 2019

It’s the question on every SaaS founder’s lips: Is my churn rate too high? A “good” churn rate for one company might be terrible for another. Worse, comparing average churn rates across different markets and industries will leave you mired in confusing statistics and contradicting studies. What is the average churn rate?

Churn 55

Churn SaaS Payments Payments Payment Methods 55

SaaStr

DECEMBER 27, 2020

New Relic’s net negative churn / net dollar retention has dropped to 98% in the last quarter, despite a record 77% of revenue being from the enterprise. If New Relic had even 120% NRR, it’s growth rate with the exact same rate of new customer acquisition would be 137% instead. It’s the secret to scaling effectively.

Scale 301

Scale Outsourced Development SMB Cloud 301

SaaStr

NOVEMBER 14, 2023

That way, they know what growth to expect and what incremental uplift they’re getting from having sales involved so they can continue to make better investments. Driving Market Acquisition When designing a compensation plan, you have to decide what behaviors you want to drive. The first might be market acquisition.

Compensation 161

Compensation Sales Azure AWS 161

SaaStr

JANUARY 17, 2023

Two benefits you can expect from focusing on both PLG and SLG are: Optimizing customer acquisition costs. Invest In PLG and SLG Simultaneously. You have to invest in both of these strategies simultaneously. . How does each persona discover the solution, and what are you doing to find them? . Increase revenue. You need both. .

Startup 225

Startup Sales Sales Funnel Education 225

SaaStr

APRIL 2, 2023

Later on, when we thought a new acquisition of raw technology was ready to scale (it wasn’t – it is now) In 2022 (like many companies), when we misread the “COVID bump” of 2021 for a secular change in software In each case, the mistake wasn’t being aggressive. Invest in back-office systems early. Your new logos grow rapidly.

Sales Hiring 263

Sales Hiring Scale Scaling Customer Success 263

Tom Tunguz

OCTOBER 15, 2013

Churn, masked by growth, becomes a limiting factor of growth. How much should the business invest in managing churn? Our SaaS benchmarks from earlier this week tell us the average public SaaS company has a 3% monthly revenue churn or a 2 year lifetime and a sales efficiency of 0.8,

Churn 100

Churn Startup Management Scale 100