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Dear SaaStr: Which Tactics Always Work to Drive Down Churn, and Drive Up Retention? We already discussed this a bit above, but make driving down churn and drive net retention up a Top 5 company goal. I see many SaaS start-ups with mediocre retention with … mediocre NPS (20-30). NPS is A Great Core Metric. Not for real.
Dear SaaStr: What Are the Most Important SaaS Metrics in the Early Days? In the early days, there are probably only 5 metrics that really matter : ARR ARR Growth Rate Burn Rate True Customer Happiness. NPS is A Great Core Metric. Don’t get lost in secondary metrics and miss the bigger early-stage goals.
Next, define what you need from a metrics and reporting standpoint. Startup Metrics with Dave McClure Dave McClure has a great presentation on Startup Metrics where he points to some additional metrics that are useful to consider: A : Acquisition - Where / what channels do users come from?
A good playbook for customer success is all about driving retention, expansion, and customer happiness while making it scalable: Hire Truly Product-Savvy Customer Success Managers at First Focus on hiring people who customer-focused product nerds to start. Use metrics like product usage, NPS, and engagement to identify risks early.
The team lacked visibility into key metrics like average revenue per customer. At Checkr, it’s not a license-based model, and yet the team had no visibility in the usage-based equivalent metric of average revenue per user, which is average revenue per report that the customer is running.
”” Benchmark Data The data shown below depicts how the ServiceTitan data compares to the operating metrics of current public SaaS businesses. ServiceTitan discloses that their net retention is “>110%” Gross Margin Adjusted CAC Payback (Previous Q S&M) / (Net New ARR x Gross Margin) x 12.
It’s to say many of us do not know how to use AI effectively enough yet to impact conversion metrics. #6: 8: 3x Net Dollar Retention Thanks to This Pricing Model Over time, the dominant pricing structure in B2C and B2B applications is like the cell phone plan. So how much business has it closed? Now, it’s about 120%.
Dan, a Stanford-trained engineer with experience guiding companies like Intuit, understands how to optimize your product metrics for growth by focusing on retention and building a product users truly value. Understanding the product metrics Let’s have two products – A and B. Customers leave as fast as new ones come in.
Moving from Churn to NRR as the Core RetentionMetric. NPS is now the #1 metric at HubSpot — for all employees. We’ve talked about this so many times over the years, that the real power of NPS is that it’s the one metric every employee in every functional area can impact. NPS is A Great Core Metric. #3.
SaaS metrics can be more confusing than one might think. My SaaS Metrics Primer: * ARR always = 12x MRR. Look, ARR and MRR aren’t really GAAP metrics. This sounds minor, but it isn’t. “Burn Rate” is another non-GAAP but critical SaaS metric, and it’s exactly how much cash goes out the door.
Driving revenue through acquisition, expansion, and retention. “Having highly tenured reps tends to drive the highest performance, and good managers are key to retention.” “Having highly tenured reps tends to drive the highest performance, and good managers are key to retention.” ” 3.
Building a commission plan for Account Managers (AMs) is a bit different than for AEs (Account Executives) because AMs are typically focused on retention, expansion, and upsells rather than net-new sales. The variable portion should be tied to measurable outcomes like net retention, upsell revenue, and customer satisfaction.
Net Dollar Retention. More compelling than simply the growth in count is the disparity in Net Dollar Retention of these large customers. If that’s not a suite… Founded ten years ago, the company has scaled rapidly selling their software management suite to small and large companies alike. Revenue, $M. Revenue Growth. -.
I mean, Canva’s metrics for example are just awesome. But with everyone discussing PLG, there just isn’t enough discussion in B2B of Product-Led Retention. But our B2C friends obsess about Product-Led Retention. But that’s not really Product-Led Retention. Or at least, they hoped so. But far from all.
The event is known for its focused content on SaaS growth strategies, metrics, and best practices, making it particularly valuable for B2B SaaS companies. It’s the largest non-vendor SaaS conference in the world, typically drawing over 12,000 SaaS founders, executives, and investors.
Metrics are the key to evaluating success and setting goals, but not every SaaS business should orient itself around the same one-size-fits-all numbers. This flexible mindset creates just the right conditions for embracing evolving business models and new metrics. The Metric Monolith: The Rise and Fall. Gross Retention = 90% +.
Massimo Arrigoni, CEO of Beefree, and Enrica Lipari, the People and Culture Director of Beefree’s parent company, Growens, share 5 secrets to a high employee retention rate. You also coach them on figuring out whether the new thing is working or not and what metrics you should measure. Why do they stay?
Let’s break down the real metrics from companies doing this right. But the data showed that behavioral triggers (like “2 hours after last app session”) consistently outperformed time zone optimization by 40-50% on engagement metrics. Quick Reality Check: 84% of customers now expect personalized experiences.
” The company grew from $15M in ARR to more than $1B with this model, consistently achieving better than 130% net dollar retention. With this model, Twilio maintained contracted revenue at less than 50% of ARR while achieving industry-leading retentionmetrics. Sales teams lose leverage.
Net Dollar Retention. Amplitude offers three key products: analytics for measuring user behavior, experiment for testing new user flows, and recommendation which optimizes content for different user segments. Revenue, $M. Revenue Growth. -. Gross Margin. Sales Efficiency. -. Net Income Margin. Cash Flow from Operations Margin. Customer Count.
Time-to-value is your most critical early metric. Time-to-value plummeted Expansion revenue became almost automatic Sales cycles got more honest and efficient The 5 Things We Learned About Customer Success at $100M+ ARR Sales actually exaggerates. Shocking, I know. But a great CS team keeps promises realistic and achievable.
So don’t get me wrong — NRR is a Top 3 Metric for any SaaS company. And it doesn’t put retention as goal #1. Your gross revenue retention — what % of the revenue base a CSM has at the start of the year that you retain, before upgrades and growth. Low NRR is a flag, a canary in the coalmine. Don’t.
For a VP of Customer Success (VPCS), their “quota” or ownership should revolve around two key metrics: Net Revenue Retention (NRR) and Gross Retention Rate (GRR). NRR is the North Star metric for customer successit measures how much revenue youre retaining and expanding from your existing customer base.
Just look at the numbers: Enterprise customers bring 95%+ best-in-class retention vs. 85% in mid-market. But the rewards – higher retention, bigger deals, and ultimately a much larger TAM – make it worth the investment. That compounds dramatically over time.
Monday Has Incredible Free Cash Flow Margins Monday.com has managed the impressive feat of maintaining strong growth while significantly improving profitability metrics. Monday.com is clearly exceeding this metric with 30% YoY growth + 14% operating margin = 44%. This is what 12x ARR selling to SMBs++ looks like.
Meeting intensity KPI challenge : Sometimes AI efficiencies can reduce a company’s core metrics (like Calendly’s “meeting intensity”), requiring leadership to make conscientious decisions about value tradeoffs. Building separate AI interfaces can create unnecessary tech debt and learning curves.
What data and metrics do you need to convince SaaS investors you’re in good shape and aligned with what they care about? These metrics are more targeted to those preparing for a Series A or B round and could make the difference between an excited-to-invest-in-you investor and a pass. There are a few cool ways to visualize this data.
In this week’s Workshop Wednesday , Salesforce Ventures Investor, Jessica Bartos, shares the 5 metrics every SaaS company should care about in any market environment, especially the one we’re currently in. Growth Is Still Number One Growth is still the number one metric, but it’s not the only one. You do that by showing momentum.
Learn about the most important SaaS metrics for founders in 2023 with the CEOs of the most metric-oriented company, monday.com, and the founder of SaaStr. For a quick recap on SaaS metrics: What is ARR in SaaS? So now we must be smarter about the most important SaaS metrics because they matter again. The takeaway?
Rep Performance : Dive into individual and team performance metrics. Metrics like time spent in each stage and reasons for lost deals can provide clarity. Churn and Expansion : For existing customers, analyze churn rates, upsell/cross-sell performance, and NRR (Net Revenue Retention). Are you losing deals at a specific stage?
If you can maintain this pace and improve your metrics (like NRR and sales efficiency), you could still build a significant, valuable B2B business over time. At 35% growth, youre not on the IPO trajectory, but you can still build a profitable, sustainable business if you focus on efficiency and customer retention.
Net Dollar Retention Hit 124% – Signs of Long Team Durable Growth Palantir’s net dollar retention rate of 124% in Q1 2025 indicates that existing customers are significantly expanding their usage year-over-year. [link] — Akshay Krishnaswamy (@hyperindexed) May 5, 2025 5 Interesting Learnings: 1.
Given most software companies are not profitable, or not generating meaningful FCF, it’s the only metric to compare the entire industry against. I created this subset to show companies where FCF is a relevant valuation metric. Revenue multiples are a shorthand valuation framework. Even a DCF is riddled with long term assumptions.
“Retention is the new acquisition,” says Co-Founder and CEO of Insider, Hande Cilingir. Harvard Business School Research says that “increasing customer retention rates by only 5% increase a company’s profits by 25-95%.” Customer retention means building relationships with people. That’s huge! a feat Insider has achieved.
Implementation of Product-Led Growth The transition to product-led growth (PLG) required understanding and implementing a fundamentally different business model.
Some fun facts: 10+ years of SaaStr conference attendance Partner at Point Nine Capital, a leading early-stage VC firm Geographic reach: Actively investing across Europe, US, and Australia Notable portfolio: Zendesk, Algolia, Contentful, Loom (and many more) Known for his “five ways to build a $100M business” framework The 5 Key Things (..)
For example, HubSpot famously split commissionshalf on deal closure and the other half when the customer hit a specific usage metric (e.g., Collaborate with Onboarding and Customer Success : Encourage collaboration between sales and customer success teams by offering team-based bonuses tied to activation and usage metrics.
Revenue Model Clarity is Critical The best-performing B2B software companies appear to have clear, predictable revenue streams and strong customer retentionmetrics, which translate to investor confidence post-IPO.
Focus on the right metrics : Be transparent about your key metrics rather than relying on vanity numbers. Run an intentional process : Be strategic about your fundraising approach rather than scattershot or overly compressed. Allow time to build relationships with potential investors.
If youve come up in your career through sales, you’re used to living in a world defined by revenue metrics. Its easy to think of CS as a retention function. 1: Net revenue retention (NRR): your valuation growth engine. 2: Gross revenue retention (GRR): can you hold what youve won? It shows your pure retention rate.
Metrics, Metrics, Metrics The first thing Secureframe thinks about is metrics. If you don’t know your key company or North Star metrics, talk to your investors or other experts to figure out what they should be. So they can take action on the metrics in real time if they’re going in a direction they don’t like.
We wanted to kick it off with some of the key insights with Box CEO Aaron Levie and IBM VP AI Raj Datta: The Numbers Don’t Lie – ChatGPT Hit 500M Users in Just ~2 Years Let’s start with the cold, hard metrics that SaaS leaders seem to underestimate: AI adoption is happening at an unprecedented velocity.
Through these interactions, I’ve built up mental benchmarks for metrics on which I place extra emphasis. My hope is that this analysis can provide startup entrepreneurs with a framework for how to manage their businesses around SaaS metrics (e.g., net retention and CAC payback). Subscribe now What Happened in Q1?
Performance bonuses : Tie bonuses to clear, measurable goalsARR growth, profitability, or other key metrics. For example, you could offer a bonus structure where the CEO earns an additional $50k-$100k for hitting specific milestones, like doubling ARR or achieving a certain NRR (Net Revenue Retention) target.
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