25 ms·

The Business of SaaS

• statictype 9y ago
  What are some examples Of high touch SaaS (besides Salesforce)? And any that have successfully deployed both low touch and high touch?
  • charleyma 9y ago
    Dropbox and Box employ a bit of a hybrid model. For SMBs, there's a self service model that's low touch but for enterprises, the sales + customer service is very high touch and requires a lot more customization. BI tools such as Periscope, Looker, Mode, Tableau, etc are also a bit of a hybrid. Usually starts off with an individual playing around or looking for a tool (pretty self service), but a full company deployment is much more hands on and high touch. Following the framework that Patrick provides, odds are that any company that has "sales engineering" or "integration engineering" for a SaaS will likely be high touch (unless they're doing it wrong =D)
  • curuinor 9y ago
    High touch SaaS sees much... much.... much... less benefit from marketing. So many don't market themselves as often, or market in specialty places. Salesforce isn't even that much of a household name.
    • trjordan 9y ago
      The benefit enormously from marketing, but they don't benefit from high-visibility brand marketing. Trade shows, performance marketing, affiliates, content marketing, retargeting, account-based ads ... those all work well.
  • beberlei 9y ago
    I would consider NewRelic, AppDynamics and other more expensive APMs high touch.
  • icebraining 9y ago
    There are a lot of small companies offering that - a mix of SaaS and custom development. In a previous company, we built a SaaS platform (based on Odoo, a kind of semi-open-source web version of SAP) which allowed clients to purchase changes to any part of the application. Unlike in a typical SaaS, each client had its isolated copy of the app/database/etc (though all running on our cloud), so they could change anything. Some changed nothing, others have whole new components and business flows.
  • rconti 9y ago
    Qualys
• phlowbieuq 9y ago
  If anyone was curious about Inovalon's $70M customer, it appears to be Anthem. It isn't explicitly called out that way, but from page 23 of that report: Our largest client, Anthem (formerly known as WellPoint), represented approximately 17% of our revenues for the year ended December 31, 2016, while no other clients represented greater than 10% of our revenue.
• theunixbeard 9y ago
  This is by patio11, in case it wasn't apparent.
• m12k 9y ago
  I've been following patio11's blog posts since way back in the Bingo Card Creator days, and he's part of what inspired me to start my own SaaS. I hope his gig at Stripe is good for him, because I think he's supremely well suited to the role of 'teacher' and I think posts like these are great (even if they are part of a content marketing strategy for Stripe)
  • alex_hitchins 9y ago
    Can you give some info on your SaaS? Any tips/hints/tricks? I'm always looking to hear stories from people who have shipped a product. Keen to make this year the year I create something small.
    • jgable 9y ago
      I'm taking 30x500 from Amy Hoy and Alex Hillman. They are in patio11's orbit. It's an expensive class and would only be worth it if you are really willing to commit. They have some other less expensive products (Year of Hustle, Just F$&*% Ship) that you can use to dip your toe into their methodology. Look up their blog "Stacking the Bricks". Not affiliated in any way, just a fan and appreciative customer.
      • alex_hitchins 9y ago
        As someone who has looked at the course also, I'd be really interested in hearing your thoughts on the class. I'm quite sure it's all good stuff, but like all things only really hear about the success stories. A genuine appraisal of the coaching, course materials and time involvement would be really, really interesting.
        • jgable 9y ago
          I’m keeping a journal as I go thru the class that I plan to publish at some point. I’ve just gotten to some meaty parts and I can say I’m impressed, but you’re right, I’m not a success story (yet). We will see!
• erikrothoff 9y ago
  Great read! The "Churn rates" section was super interesting. Our SaaS has hovered around 4-5% churn rate. Glad to see that's doing pretty OK! Interestingly enough in December we increased our prices by quite a lot (percentage wise, $2/month to $6/month). That month we saw an 8% churn rate, and January 6%, and this month looking like a bit less. It's going to be really interesting to see what happens in the future. The jury is not in yet, but it feels that the voluntary churn is a lot less for the customers paying more, compared to the lower price point.
  • PerfectElement 9y ago
    > The jury is not in yet, but it feels that the voluntary churn is a lot less for the customers paying more, compared to the lower price point. I noticed the same. Our $29.90 plan churn is 3x higher than our more expensive plans.
    • janlukacs 9y ago
      Since they pay more, they value the service more, so they tend to stick around more :)
  • janlukacs 9y ago
    Are you talking about monthly churn or yearly?
    • erikrothoff 9y ago
      Monthly churn. We're using Chartmogul for the stats.
      • janlukacs 9y ago
        What does the app offer? What type of customers do you have?
        • erikrothoff 9y ago
• aresant 9y ago
  Outstanding summary Patrick, was prepared for a piece of dry content marketing but many gold nuggets as usual! I would add a couple of supplementals unique to 2018 for those of us raising capital in a SAAS or looking to liquidate: 1) The "SAAS Napkin" for 2018, a survey of ~50 Series A / Series B funded companies that have shared with regard to growth / churn / etc. Links here https://www.producthunt.com/posts/saas-funding-napkin-3 https://www.producthunt.com/posts/saas-funding-napkin-3 and explanation here https://medium.com/point-nine-news/what-does-it-take-to-raise-capital-in-saas-in-2018-204d0a46cb23 https://medium.com/point-nine-news/what-does-it-take-to-rais... 2) The fascinating rise of Private Equity companies as a liquidity / funding option outside of larger co Acquisition / VC money as observed by the founder of Pardot (~$100m exit to SalesForce) - https://davidcummings.org/2017/10/03/private-equity-as-the-saas-savior/ https://davidcummings.org/2017/10/03/private-equity-as-the-s...
• ryanianian 9y ago
  Coming from somebody who doesn't really know anything about business or how to make SaaS work (despite working as an IC for a SaaS company) this article is very enlightening. In particular I never really grokked how to think about "churn rates" until reading this. It's actually pretty simple when it's explained well! It's also written very clearly and candidly (although admittedly it's a bit of a self-congratulatory pitch for Stripe).
• mooreds 9y ago
  So, this quote is my key takeaway: "There are, broadly speaking, two ways to sell SaaS. The selling model dictates almost everything else about the SaaS company and the product, to a degree which is shocking to first-time entrepreneurs. One of the classic mistakes in SaaS, which can take years to correct, is a mismatch between a product or market and the selected model to sell it on." From helping build a SaaS company for the last couple of years, I can tell you that knowing which kind of "touch" your product is very very important. Really important. There are a lot of SaaS markets where the customer needs high touch but can only pay low touch prices. That's not a fun place to live, though it can be a good place to start and then move upmarket. I remember seeing that grid of high/low touch and high/low ACV outlined somewhere, but I don't remember where.
  • ams6110 9y ago
    > There are a lot of SaaS markets where the customer needs high touch but can only pay low touch prices. That's not a fun place to live, though it can be a good place to start and then move upmarket. This just seems like a really bad place to start. Do you have an example where it worked?
    • sirspacey 9y ago
      One example is OpenDns: https://www.saastr.com/david-ulevitch-opendns-learning-to-love-enterprise-sales/ https://www.saastr.com/david-ulevitch-opendns-learning-to-lo...
    • mooreds 9y ago
      Hmmm. Maybe mind body? QuickBooks? Any saas product that is a crucial part of a business will necessarily be high touch. The reason why it might be a good place to start is because you can find enthusiastic customers that are ill served.
      • mooreds 9y ago
        Actually, my examples are probably bad, I was thinking about them in the early days, but those are low touch businesses now.
• danschumann 9y ago
  Do software products like adobe photoshop for $20/month count as SaaS, or merely a subscription based software product?
  • samstave 9y ago
    Technically, if its an app which runs in your browser, and in the cloud only, it would be SaaS, regardless of function. But it also qualifies as a software subscription. So, yes.
    • danschumann 9y ago
      Well.. photoshop runs on your computer.. but it requires you to be logged in. It used to be a 1-time purchase, but now it is monthly subscription.
      • samstave 9y ago
        Ah, then nope, just a subscription... and lame one at that. Have you seen this? https://www.figma.com/ https://www.figma.com/
    • ams6110 9y ago
      The lines are blurry. For example there are apps that can run in something like Citrix Connector, VNC, even ssh etc. that are not running in a browser but also are running "in the cloud" (whether private or public).
  • hackme1234 9y ago
    It's a subscription based software. For something to be SaaS, the software has to be in the cloud.
    • janlukacs 9y ago
      I think that we're at a point where customers no longer care, it's just a technicality
  • 9y ago
• deleted 9y ago
  [deleted]
• gfodor 9y ago
  patio11 refers to subscription based software as a "financialization" of it, but I'd argue it runs deeper: it turns software from a single, large "opt-in" transaction, to a small "opt-in" transaction followed by a series of "opt-out" decision points for customers, putting more of the burden on the customer to disengage vs the business to sell the customer on the latest version every couple of months. This runs into some tricky ground. Consider the fact that many customers who do not churn may also have not used the product, at all, in a given month. Given the difference between "existential risk" and "profitable enterprise" is a 5% change in churn rate, these customers may make all the difference! How does a company balance reducing churn with ensuring that customers who (perhaps temporarily) have dis-engaged can easily turn off the software? For example, how long of a period of inactivity should a company wait before asking a customer if they would like to unsubscribe? Do any companies actually do this? Should we expect them to do this given that doing so may kill their entire business?
  • atg__ 9y ago
    The people that don't show up to the gym are what make the business profitable.
    • biztos 9y ago
      I've heard this before and intuitively it seems right, but only for certain gym cultures. In the US almost everything is membership-based, so a paying member who doesn't show up is free money until they cancel. But there are other places where it's more flexible, for example my gym has monthly passes, dailies, and 10x or 20x passes. The 20x is the best deal if you miss a few days a month due to travel. None of this has any recurring billing. I'm sure even that gym has a bump in monthlies in January and May/June but with their setup it seems much more in their interest to have everyone actually coming to work out, else they might just not bother to buy that next monthly.
      • kbenson 9y ago
        There are different types of gyms. 24 hour fitness, for example, will happily keep charging you if you don't come in, and if you try to cancel over the phone often tries to force you to come in and do that in person (I'm not sure how much of this part is corporate strategy or poorly incentivized branch behavior).
• graeme 9y ago
  The free trial section gave me an idea. I have a product (a course) which can be used in 2-4 weeks. This isn't exactly SAAS, but there's some overlap. Has anyone ever seen (or tried) a full free trial which lasts 2-3 days? I currently just have some demo videos, but it occurs to me I might increase conversion if I just let people into the full thing, let them have a taste, and then ask them to pay if they want to keep access. I could limit it by time or percent watched.
  • samsolomon 9y ago
    It may be worth trying. Design+Code is a pretty well-known course for designers that want to build iOS apps. The previous version of this course was a one-time payment of $50. For the newest version he's moved to a subscription with a 7-day free trial. However, you do have to add a credit card for the trial. https://designcode.io/ https://designcode.io/
    • graeme 9y ago
      Thanks! That's one's probably a bit long for my courses, which are 5-24 hours in length. I could try maybe a week with a credit card option on the longer one. Or test a "percent complete" lock on the shorter one.
  • beberlei 9y ago
    Yes this exists, for example Travis-CI Pro has a free trial that includes 100 builds and is not time based.
  • icebraining 9y ago
    Full-featured time/use-limited trials are pretty common. Netflix, Spotify, Audible, all offer the first month, for example. Specific to your area, Coursera and Lynda both have them.
    • graeme 9y ago
      Mmm. Those are traditional, longer trials though, as they tend to be longer services. Do you think it would work on a shorter timescale for short courses?
• k__ 9y ago
  How do these numbers relate to bootstrapped SaaS?
• fairpx 9y ago
  Fantastic article patio11. I work with a lot of SaaS companies on a daily basis (designing their product with our team [1]) and get to see the thought process of the founders. The part about product market fit is super crucial. I can clearly see that the founders that keep an ongoing feedback loop between customers and product always end up building a more successful business. Will def. share this insightful post. Tnx for the writeup. [1] http://fairpixels.pro http://fairpixels.pro
• dayjah 9y ago
  While running Heysan (YC W-07) we were having a hard time hiring; startups were a hard sell back then, and given we were building a product aimed at feature phones it was harder still to convince folks to join. We faced a meaningful decision: whether to buy a subscription to a product or build it ourselves. The notion of SaaS clearly existed back then, but it had not yet developed into what it is now; it was more akin to buying software licenses per CPU than the sort of products and pricing that we have now. Also, pertinently, I was a young and inexperienced CTO who had no real framework for how to approach this problem, so I took it to the board, the answer was resounding: pay for it. In 2011, while deeply ingrained in converting justin.tv -> twitch.tv, the same sort of decision came up: should we build our analytics or should we buy it (mixpanel in this case). This time it was obvious: buy it. In the time from that first decision and the later decision at Twitch I was able to fully appreciate why you buy, and Patrick nails it in the first few sentences: > Unfortunately, many entrepreneurs discover this body of practice the hard way, by making mistakes that have been made before, rather than by spending their mistake budget on newer, better mistakes. also: > Customers love SaaS because it “just works.” There is typically nothing to install to access it. Hardware failures and operational errors, which are extraordinarily common among machines which are not maintained by professionals, do not result in meaningful data loss. I've often retaught these points to folks: "Our job is to deliver a product to our users, they don't care about the ancillary product we use to deliver them our primary product. Buying Saas is like hiring pro's to do a job at the fraction of the cost of hiring pro's to do that job". Or as Matt Brezina (Xobni & Sincerely) likes to say: Hire via API ( http://www.mattbrezina.com/blog/2011/08/hiring-via-api/ http://www.mattbrezina.com/blog/2011/08/hiring-via-api/ )
• lettergram 9y ago
  Well.. after reading those conversion rates - I feel pretty happy with my conversions :D I've been using Stripe and Stripe Atlas since 2016, and it's helped me grow my business well. Slowly iterating. My particular tactic is to give users a full refund - every month - they give me feedback via a survey: https://projectpiglet.com/ https://projectpiglet.com/ It's actually been super nice because people are super willing to pay after I build out the system the way they want. They then tell their friends and so on. Then there are websites I built like: https://easy-a.net/ https://easy-a.net/ Which only has a 3% conversion rate form registered users to paid users. Apparently, that's pretty good as well... People love it and I haven't touched the website in 18 months -_- It's clear why SaaS is superior in that aspect, because it's 100% automated, makes money, and I don't even touch it. Updates are nearly completely automated on Easy A, and https://projectpiglet.com https://projectpiglet.com (being completely in development) requires a bit more, but also completely automated.
  • Sir_Cmpwn 9y ago
    >My particular tactic is to give users a full refund - every month - they give me feedback via a survey Nice, I'm gonna steal this idea!
    • lettergram 9y ago
      By all means! It's also nice because often people forget so one month I'll get feedback, the next I'll get $X, then the following I'll get feedback again. Customers tend to blame themselves for forgetting the feedback and eventually some users are like, "Hell, this is exactly what I wanted" and they'll pay full rate.
• pilingual 9y ago
  Product/market fit wasn’t coined by Marc. It was Andy Rachleff: https://a16z.com/2017/02/18/12-things-about-product-market-fit/ https://a16z.com/2017/02/18/12-things-about-product-market-f...
• jwr 9y ago
  Fantastic article. I wish I had access to that sort of knowledge before I started my own SaaS [1]. I'd like to underline two points, in case anyone reading this is thinking about starting their own bootstrapped SaaS (I guess many HN readers are): * The long slow SaaS ramp of death is true. SaaS businesses, especially bootstrapped (and cash-starved) ones do not grow quickly. It takes years, as in more than one, and possibly several years. * Apart from product-market fit, the biggest problem is marketing. Contrary to what one might expect, it is extremely difficult to get one's product in front of customers. So, set your expectations accordingly. [1] https://partsbox.io/ https://partsbox.io/
  • ultrasounder 9y ago
    Technical details, for those so inclined: the software is written in ClojureScript (compiled to highly optimized JavaScript) on the client side, using React.js for user interface updates, and Clojure on the server side, running in a JVM (Java Virtual Machine). It uses the RethinkDB distributed database for data storage. Interesting choice of Tech stack. Care to explain why you went with Clojure backend and ClojureScript for react on the Front end instead of much more traditional choices?
    • jwr 9y ago
      Those are very pragmatic choices. I don't think I could a) tackle the complexity and b) achieve the performance I wanted without Clojure and ClojureScript. RethinkDB is used for two reasons: 1. It's the only database that provides changefeeds that I need to implement real-time updates for users. Complete changefeeds, as in: get an initial state and then updates. 2. I wanted to easily solve replication, fault-tolerance and scalability, RethinkDB gets all of them right, at least for the levels of scalability that I require.
      • ultrasounder 9y ago
        Great answers!. Thanks to You I learnt a new tech-stack today and cant wait to try it out. I also am an EE Btw, and I wish my Purchasing person had tools like these available to them to do better production planning back in the days which was like 5 years ago !
• amelius 9y ago
  Nice article, but the most interesting question remains unanswered: how/where to find SaaS business ideas?
  • bfred_it 9y ago
    Hang out with people and hear their problems. Usually these are not as clear as "I wish I had a way to access my home PC files from work" but more like "damn, I left by USB card at home!" (hinting at Dropbox)
    • mooreds 9y ago
      "Hang out with [regular] people, [preferably those controlling budget at a business]" is how I'd put it :).
  • Trundle 9y ago
    Do contracting at rates affordable to small businesses. They'll come to you with problems they're willing to pay to fix and can't find a decent premade solution for.
    • Trundle 9y ago
      Didn't flesh this out in time for edit. - Don't position yourself how you normally would if you were going for a new job and trying to maximise your income. No "senior developer with experience in python, node, etc" - Do position yourself as just a general "software developer". I said contractor before but I wouldn't (didn't) even make it look like that. More like a small agency. If they're completely outside of the tech industry (what you want) then they're going to be wanting someone to just give money to in exchange for solving their problem, not someone they're going to have to manage. Instead of hiring Dave by the hour, they're hiring "[town name] Premier Development" on a fixed project basis. - Be selective with who you take on. Again, you should be positioning yourself pretty cheap to the point where if this wasn't basically an exploratory exercise for you then their project wouldn't be worth your time, so you don't want to get stuck doing work that isn't a potential SAAS for you down the line. - You want them coming to you trying to get something done for $15k that would normally cost $100k+ to build. Then you say "hey, if you're willing to be my test dummy/case study/first customer, I'll build it and give you a licence for $10k"
• a13n 9y ago
  Yikes, that was the best article on SaaS that I've read all year. So much great information. A few things jumped out to me as off: > Conversion rates of low-touch SaaS trials with credit card not required: > 2%+: extremely good Really? 2% seems awful. If a company signs up for your trial, they must have a problem they're trying to solve. If you don't solve 98% of peoples' problems, it seems like you have a problem getting people engaged with your product. Our (bootstrapped low-touch B2B SaaS's) trial -> paid conversion is closer to 8%. This doesn't feel "extremely good". I think we can do much better. > Virtually no low-touch SaaS business achieves net negative churn; their churn rates are too high to outrun. What about Intercom and Front? Are they just outliers? I would guess that this is actually true, but only because most low-touch SaaS business don't have scaling pricing - they have fixed plans. If you have pricing that scales with usage/value, you'll make much more each month from expansion revenue. Overall I loved the article, and wish I could have read it a year ago before we launched our SaaS company. Thanks patio11 and Stripe.
  • abalone 9y ago
    > If you don't solve 98% of peoples' problems, it seems like you have a problem Nah, great products are about focus. You definitely don't want to scope your focus as "98% of peoples' problems."
    • a13n 9y ago
      Not 98% of people... 98% of people who had a problem that they felt signing up for your trial would solve. It's not like trial signups are coming from random people across the globe.
  • amitmathew 9y ago
    I think the 2% metric refers to all users from top of the funnel to paying customer. I've always found the metrics in this deck helpful: https://www.slideshare.net/totango/2012-saa-s-conversions-benchmark https://www.slideshare.net/totango/2012-saa-s-conversions-be....
    • a13n 9y ago
• itwy 9y ago
  The author is an overrated word-seller. Why would I take startup advice from a full-time employee? Downvote away.
  • mooreds 9y ago
    His history and relationships with many startups?
    • itwy 9y ago
      Nothing stellar about his history apart from fooling the HN community with his authoritative tone.
• old-gregg 9y ago
  > Businesses and investors love SaaS because the economics > of SaaS are impossibly attractive relative to selling > software licenses. I would be careful and not over-generalize. The statement above is opposite of what many late stage investors think of SaaS companies. Their gross margins tend to be horrible. Some are basically in the business of being an intermediary mailbox for transferring money from their customers to AWS. Sure, if you can charge, say $1 for processing one Kb of data, you'll love being in the business of selling SaaS subscriptions. But it's not always the case: for many SaaS companies selling more and more subscriptions means constantly re-writing (AKA "scaling") their codebase, maintaining a large and expensive ops team and dealing with ever-growing AWS bill. Some SaaS companies only have ~10% of their R&D allocated to evolving the product, the rest are struggling keeping it running and it's not cheap. Compare that to selling a recurring subscription to a downloadable license file. Stripe is a great fit for SaaS, but TWLO will have to face a much tougher reality than MSFT had. SaaS can be awesome, or can be hell, take it from a co-founder of Mailgun.com Stock market seems to agree: the 1st wave of software explosion produced lots of highly valued tech giants: MSFT, ORCL, etc. The current crop of public SaaS companies pale in comparison, the new giants don't sell SaaS, they sell ads. P.S. The billing model is very loosely related to how a software is delivered. Look at Adobe who're happily selling monthly billing plans for good old photoshop.
  • k__ 9y ago
    Isn't this more a problem of billing than of SaaS in general? But yes, I recently read that games make more money in general than even movies, books and music and most of them don't have subscriptions but one time payments.
    • lists 9y ago
      All AAA games have either micro-transactions, additional purchasable content, or both
      • runevault 9y ago
        I seem to recall seeing a report recently that Activision-Blizzard made more money from micro transactions than non-MTX revenue last year.
• deleted 9y ago
  [deleted]
• konschubert 9y ago
  Slack kind of found the holy Grail of SaaS sales where they get a foot in the door like a low-touch SaaS product where employees just start using it. But then they convert this into a high-touch business with low churn after the employees convince their boss to start paying. They basically have outsourced enterprise sales to their customers.
  • andkon 9y ago
    They didn't have an enterprise division until about a year and a bit ago, so I think it's more accurate to say that they found a channel that normally only works for low-touch SaaS, but for a product and business model that can charge SMB rates. As someone else stated in another thread here, $100k+ deals don't happen because some employees use your product. It requires an enormous amount of sales and marketing infrastructure — and just plain old time — to rally someone else's organization around the change that adoption of your product entails.
  • goatherders 9y ago
    Yammer did a great job with this kind of sales long ago as well.
• yazr 9y ago
  The article is excellent, but .. > [SAAS..] spend less than 5~10% of their marginal revenue per customer on delivering This is really, really not realistic. Just billing through Stripe will cost you 2-3% commission. I was involved with a financial SaaS and I couldn't believe how many sub-services they needed just to keep the product alive
• intrasight 9y ago
  I've been plugging away at my SaaS app for many years. Have bounced around on the "low-touch" vs "high-touch" spectrum as well as on pricing. I am in agreement with most of the article. If I could do it over again, I'd focus on finding a good niche of "low-touch,high-price". Sure you say "that's obvious", but if so, why are there so many people trying SaaS companies that are not? If you are considering Stripe, you are already off the mark. You should be having Quickbooks send quarterly or annual invoices for at least $10K. Companies will happily pay if you are solving some problem that is costing them $50K per year. There are still so many opportunities to reduce IT costs through SaaS. I've been in software a LONG time, and I think this is a golden age, with things like AWS and Azure and third-party horizontal services for pretty much everything. Just find your niche of companies that have issues that nobody is addressing. Help them automate tedious and time-consuming things like reporting and dataflow. Help them with regulatory compliance. Think of it as consulting where they also pay for platform services. I also take issue with "investors love SaaS". The margins just aren't high enough to make it worth the risk. You might find an investor willing to do a deal for cash flow. But I think this is like Stripe - if your thinking VC capital, you're already off the mark. Your customers need a solution and they will be your investors.
  • laverick 9y ago
    I'd expect $10+k/quarter to require high touch sales & account management in most cases.
    • intrasight 9y ago
      Hasn't been my experience. Sales cycle can be long, but doesn't demand a lot of cycles.
• nateburke 9y ago
  Great article. Bill Janeway offers a well-written deconstruction of the "impossibly" part of the author's "impossibly attractive" characterization of SaaS here: https://wtfeconomy.com/enterprise-software-death-and-transfiguration-99eb1d3fc4c0 https://wtfeconomy.com/enterprise-software-death-and-transfi... (from 2016)
• taherchhabra 9y ago
  Wonderful content marketing strategy :)
• seizethecheese 9y ago
  How do people "flatten" churn to a single number? In my experience churn is very high in the first month, then falls as time goes on. My current (consumer) startup has a churn of around 25% the first month, then dropping to almost nothing after a few months. Using a single churn number doesn't even come close to approximating real behavior.
  • janlukacs 9y ago
    This is a sign that there might be something wrong with your positioning/marketing/messaging. The initial high churn means your customers think they will get X but they get Y - so they abandon the product. The ones that "get it" stick around. For now i would just remove the 1st month from the stats and look at it independently and then try to tweak the perception. Talking to the people who drop out will give you a better picture (it's hard but very much worth pursuing). ps: we sell project management at https://www.paymoapp.com https://www.paymoapp.com - every time someone cancels or deletes an account we show them a form where we collect data.
• wiradikusuma 9y ago
  Even though SaaS model has matured, and many SaaS are created by software developers (who are familiar with open source), I have not found a "Bootstrap for SaaS projections/financial modeling", probably in the form of shared Google Spreadsheet.
• cdevs 9y ago
  Every word on high touch was true about where I work and I hate it.