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It stands out that it's using customer count and not revenue churn. In a well running business you might see shrinking customer count but net-negative churn bec
by encoderer 6y ago
It stands out that it's using customer count and not revenue churn. In a well running business you might see shrinking customer count but net-negative churn because you're growing revenue on the accounts that stay with you. This is really very common in any SaaS that gets big.
Calculating the customer churn is valuable for LTV computation but it doesn't seem as useful as a KPI for a growing saas business as net revenue churn rate.
- davidivadavid 6y agoExactly. It's kind of well-known at this point that negative net dollar churn is what people should aim for. The minutiae of risk modelling for something as inherently volatile seem beside the point. Maybe if you're a stock analyst?
- mathattack 6y agoFor small sample sizes (enterprise customers) it’s tricky to get too crazy on stats. Simple models are better.
- jrott 6y agopractically if you are dealing with large enterprise customers it's better to use qualitative data from your account managers to figure out how much risk there is with each customer.
- mathattack 6y agoMy experience is “they love us” isn’t as strong a retention predictor as cold hard usage metrics.
- jrott 6y agoThey love us seems to never be that useful. I actually meant more in terms of there worried about foo or finding out about the dumb workaround there using. That stuff seems to be an early warning sign that something isn’t going well.