How much (what %) of Revenue (ARR) Comes From Renewals in a SaaS Company?

After the early days — most.

Of course, it varies.  But one thing that is almost always true, is you get more renewals, more upsells, and more net revenue retention from your largest customers.

  • Hubspot is almost all small businesses. As a best-of-breed player, it’s net revenue retention is about 95%.
  • Shopify sells mainly to SMBs and is at about 100%.
  • Zendesk has a mix of customers at 120% at IPO, down a smidge to 116% after IPO and 112% after Covid:

  • Box has small, medium and large customers. It’s net revenue retention at IPO was about 130%.
  • Twilio was 170% at IPO.

More here: Public SaaS Company Disclosure Metrics for Retention and Renewal Rates

So …

If you are selling mainly to small businesses, roughly, 80% net revenue retention is good, 90% is strong, 95% is Best of Breed.

If you are selling to enterprises, 130–140% net revenue retention is very strong.

For a blended model (S, M and L), 120% is strong a la Zendesk.

Whatever it is, measure it. Segment it. Resource it.

And drive it up.

If Nothing Else – Segment Churn

Published on November 11, 2016

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