SaaStr

AUGUST 16, 2021

We put out a call on Twitter the other day for folks’ best tips on what has really lowered churn for them this year. “1/ Divide your churn into manageable and unmanageable areas 2/ Strip out definable areas of churn reason (e.g. Are you segmenting churn? High usage can still mask churn.

Churn 327

Churn Sales Hiring Headcount Technical Review 327

SaaStr

MARCH 8, 2024

The burn and the churn. The burn was at a stunning $2m a month, and the churn had spiked. It’s sort of a death spiral: High churn, but no burn = struggle, but the engine self-perpetuates to an extent. What’s really hard to solve is The 3H’s: High Growth for a while — but High Churn. And High Burn.

Churn 294

Churn Startup SaaS Payments Venture Capital 294

SaaStr

FEBRUARY 20, 2024

So lately I’ve listened to a few calls from churned customers from portfolio companies. Get on the phone with all your churned customers, if you can. Image from here ) The post When a Struggling Customer Churns, You Learn How Important You Are appeared first on SaaStr. How much of a vitamin vs. a painkiller are you?

Churn 264

Churn Market Segmentation AI Cloud 264

SaaStr

JANUARY 4, 2023

Dear SaaStr: What Do You Do With Churned Customers? The post Dear SaaStr: What Do You Do With Churned Customers? You put them into a Get Them Back bucket and re-market to them with a dedicated program. And you have sales especially follow-up twice. Once in about 90 days, to see if they might want to come back — importantly.

Churn 276

Churn Marketing Data Sales 276

SaaStr

MAY 23, 2024

Should I just mark them as churned? Should I Count Them as Churned? Dear SaaStr: A big customer payed for a year but doesn’t use the product. Instead, what you should try to do is renew them, especially in the enterprise. Many of them never used the product at all in Year 1. appeared first on SaaStr.

Churn 294

Churn Enterprise Branding Business 294

SaaStr

JUNE 13, 2022

And I’m going to suggest two that will worry you a lot as you scale — Churn and Sales Cycle — you should track, but not obsess over, until you are well, well past initial traction, that first $1m-$2m ARR. >> Let’s Start with Churn. Absolutely, getting your churn trending downward is important.

Sales Hiring 275

Sales Hiring Scale Churn Metrics 275

SaaStr

AUGUST 6, 2023

As a VP of sales at early stage SaaS companies, what’s your best advice for reducing churn rate? A few things that always work to drive down churn in the early days — and later: Make sure you have a strong Head of Customer Success … whose #1 goal is reducing churn. Far fewer customers churn if you visit them in person.

Churn 234

Churn Sales Hiring Customer Success Onboarding 234

SaaStr

FEBRUARY 28, 2023

While Zoom Enterprise is growing at a healthy clip, churn is over 3% a month for its SMB customers As a result, it’s now predicting 1% growth next year 1% pic.twitter.com/i2k2W9QbVX — Jason Be Kind Lemkin  (@jasonlk) February 27, 2023 So Zoom has just been the craziest story of all time in SaaS. It probably couldn’t last.

SMB 274

SMB Churn Enterprise Engineering 274

SaaStr

JUNE 2, 2022

Two things though did get hit harder — SMB Churn and Upsell s. Customers kept buying more SaaS than ever, which masked all-time high churn in SMB accounts. So our gross SMB churn spiked to a crazy high of 5.5% You can also see highly elevated gross churn in 2009 here — the Mar-June on the left side of the X-axis.

SMB 356

SMB SaaS Churn Enterprise 356

SaaStr

NOVEMBER 27, 2024

Average Monthly Self-Serve (“Online”) Churn Hit New Low of 2.7% a Month Churn especially SMB churn remains Zoom’s biggest challenge at its mature state, but it’s been pushing customers to annual and longer contracts and more. It’s seen churn fall to 2.7% And it still trades at 5x ARR. #1.

SMB 276

SMB Churn Enterprise Acquisition 276

SaaStr

OCTOBER 12, 2020

SImple tips to Do Better in Q4 With What You Already Have: – Drive Down Churn – Drive Up NPS – Be More Grateful – Zoom with 10 Customers a Week – Promote Your Star(s) – Less Spam, more ABM – Weekly Webinar – Improve Lead Routing – Improve Lead Scoring – Talk to Every Prospect.

Sales Recruiting 351

Sales Recruiting Sales Hiring Churn Onboarding 351

SaaStr

NOVEMBER 12, 2024

SaaStr ) And once you have at least a little revenue ($1m-$2m ARR or so), net revenue retention / churn. NRR and churn aren’t necessarily statistical significant before Year 2-3 and before $1m-$2m in ARR). Churn is important, but in the early days, just drive it down. Probably, measured as NPS (more here: I Was Wrong.

Metrics 284

Metrics Venture Capital SaaS Churn 284

SaaStr

MAY 20, 2024

Not Jumping on High Churn Some types of churn certainly can be addressed over time. But if your churn and retention numbers aren’t at least mid-pack for your category, don’t let it lurk. Churn is a problem that lurks, especially in annual deals.

Trends 315

Trends Scale Sales Hiring Venture Capital 315

SaaStr

MAY 15, 2024

Churn is much higher on consumer subscriptions, but you have higher expansion revenue. If you’re in consumer, how can you go upmarket and get a small cohort of users paying more, churning less, and expanding revenue? While terrible churn in B2B SaaS is 5%, it’s much worse for mobile apps. average realized LTV. 25% isn’t unusual.

Subscription 303

Subscription Payment Features B2B Mobile 303

SaaStr

NOVEMBER 21, 2020

At least 100% net negative churn (i.e., upsell/account growth + renewals – churn) for very small businesses. 130%+ in the enterprise, and for top B2D products. Let’s look at some of the top public SaaS companies: Shopify — very SMB: 100%. Hubspot — mostly SMB: 100%. Surverymonkey — fairly SMB, but going more enterprise: 100%.

Retention 349

Retention SMB SaaS Enterprise 349

SaaStr

MAY 1, 2024

SMB Churn coming down, but still at SMB-Like Levels Zoom for years defied what we knew about SMB churn. But in the end, today, at scale, their small customers churn is at the same high rates as other “grab and go” SMB products. Still, they’ve brought churn down from 3.6% What a crazy story.

SMB 297

SMB Scale Banking Enterprise 297

SaaStr

NOVEMBER 2, 2021

Yes, this customer churned after 11 years. But it was a reluctant churn. In that gap, customers with champion change churn. Go long if you have happy customers and Net Negative Churn — Go Very Long. But if you have happy customers and net negative churn (i.e., Drive churn down every quarter.

Scale 315

Scale Churn Retention Acquisition 315

SaaStr

FEBRUARY 20, 2023

Second, few SaaS companies past $20m in ARR with negative churn seem to fail. Some do fail, but they are generally ones with low NPS / high churn and other customer issues. And an application with high churn by nature is one that is relatively easy … to move on from. They just want to bound it. The revenue recurs, after all.

Innovation 341

Innovation Churn Cloud Branding 341

SaaStr

JANUARY 11, 2024

and so deeply embedded in the fabric of our customers’ businesses that they’d never churn. Churn is so high in most B2C and B2B2C they have no choice but to obsess on improving their value proposition constantly. Well, we do all track NRR, churn and hopefully GRR too. To be so valuable, so cost-effective.

Retention 318

Retention B2C B2B Churn 318

SaaStr

JANUARY 17, 2021

In practice, high churn is the only thing. Put NPS and CSAT and churn in every weekly and monthly email. Because churn will be higher than average. Worst case, you’ll never really truly benefit from net negative churn. In theory, many things can kill a SaaS startup after $4m-$5m ARR. It’s not that hard.

SaaS 363

SaaS Venture Capital Churn Branding 363

SaaStr

DECEMBER 27, 2023

Digital Ocean is only growing 16% now at $700m ARR, and churn is up and NRR down. Still Pushing ARPU Up, Churn Stable — But NRR Way, Way Down This Year Digital Ocean has small customers and tiny ARPUs, but pushing the ARPU up a bit has a huge impact on a percentage basis. Churn Stable. It’s gotten crazy good.

Scale 290

Scale AWS Azure Cloud 290

SaaStr

SEPTEMBER 5, 2024

Each and every month, until the customer churns. The second is to pay annualized commissions, with an allowance for churn. If you are worried you are paying for churned deals, just clawback a pro-rated amount of the $4,800. This does manage cash flow better in the early days. So if you do this — don’t do it forever.

Scale 296

Scale Sales Payments Compensation 296

SaaStr

NOVEMBER 1, 2024

Annual contracts combined with prepaid cash are a huge benefit, when done right: You get all the cash up-front (this is how I went cash-flow positive in fact) — IF you can collect it a timely fashion; and Your churn almost by definition goes down, at least nominal churn.

Payment Features 262

Payment Features SaaS Churn Pricing 262

SaaStr

SEPTEMBER 7, 2023

A few things that always work to drive down churn in the early days — and later: Make sure you have a strong Head of Customer Success … whose #1 goal is reducing churn. That may seem to help short-term revenue, but it will lead to a de-focusing on driving down churn. Far fewer customers churn if you visit them in person.

Sales Hiring 295

Sales Hiring SaaS SMB Churn 295

SaaStr

MAY 7, 2024

Before then, think instead about marking up the prices of non-annual contracts to account for churn. You’ll likely want non-annual contracts to be priced 20%-30% higher to account for the effect of churn, but the exact % can vary. 40% off Year 3 for paying all 3 years up front) in the end will “harm” your ARR unless your churn is high.

Pricing 284

Pricing Churn Enterprise Branding 284

SaaStr

APRIL 17, 2021

But perhaps not that uncommon for higher-churn SMB categories. Most higher-churn SaaS companies seem to obscure, or at least, not highlight any NRR below 100%. Wix doesn’t disclose its churn, but it’s likely similar. #4. 70% annual, 30% monthly subscriptions.

Payment Methods 338

Payment Methods Merchant Services Payments Payment Services 338

SaaStr

DECEMBER 20, 2021

Moving from Churn to NRR as the Core Retention Metric. This may sound obvious to more enterprise folks, but many Very Small Business and SMB focused SaaS companies still focus more on churn than NRR. They’re changes you might want to make as well if you focused on SMBs and mid-market especially: #1. And yours as well.

Metrics 62

Metrics SMB Scale B2C 62

SaaStr

FEBRUARY 14, 2023

Churn, upsells, renewals, and all that, and compensating against it. And about measuring and identifying Almost Churn. Second, they’ll never churn as long as they are reasonably happy and you go visit. If you don’t let them down, and they get to know you personally — they will never churn.

Customer Success 327

Customer Success Compensation Churn Enterprise 327

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. Do whatever you can to drive up NRR / net negative churn. That’s up from 70% 5 quarters ago — a big change. Low NRR is the difference — and the drag on growth.

Scale 341

Scale Outsourced Development SMB Cloud 341

SaaStr

APRIL 10, 2024

Seat Contraction and Churn Remains Elevated DropBox is still seeing elevated levels of customers reducing seat count and elevated churn. #4. These high-usage, low ARPU customers do appear to be churning based on cutting back on unlimited storage, leading to the decrease customer count above, for now. #5.

Scale 290

Scale Churn Scaling Pricing 290