Negative Churn
In a board meeting yesterday, we had a brief discussion around “negative churn”. Negative churn is a catchy phrase and apparently a hot-topic in some SaaS circles. I like some of the concepts and disciplines that an understanding of negative churn implies, but I also think it is an unnecessary concept that actually makes it […]
Basics of Unit Economics Analysis
When an investment passes our first-screen at Meritage Funds, the first deep-dive we typically do is on the unit economics of the business. Unit economics are the fundamental financial building blocks of a business. If you can pin down the unit economics, you can determine contribution margins, break-even points and perform ROI calculations all of which […]
Negative Churn | It’s Not that I Don’t Dislike It, I Do
Most of us were taught at an early age that double negatives are a bad thing, because they are unnecessarily complicated and increase the chances of miscommunication. It is with this principle in mind, that I propose that we permanently ban the ridiculous term “negative churn” from the SaaS metrics vocabulary. Churn is negative growth. […]
Measure Your Churn. But What’s Even More Important is to Measure Your Almost Churn. 5 Tricks to Help You Here.
Churn is a paramount topic in SaaS, as we all know. If every dollar of ARR is worth $6+ in the long term, including upsells and second order revenue … then of course, by the same token, for every dollar of ARR that churns … you’re losing $6 of notional ARR. Lose a $100k customer? […]
What is MRR Churn? | SaaS Metrics FAQs Part 2
Why measure SaaS MRR churn? Show me the money! SaaS MRR churn is an important SaaS metric that measures the financial impact of churn. While customer churn is an important operational metric, CFOs always prefer MRR churn. In this second SaaS Metrics FAQs article, I explore ways to analyze SaaS MRR churn.
Two SaaS Metrics That Actually Don’t Matter That Much: Churn and Sales Cycles
Ok, I know the title sounds a bit controversial, but bear with me, it’s not. Metrics are critical in SaaS, and you need to track them fastidiously. But it’s also important to focus on the right metrics, at the right stage, and not obsess about the less important ones at the wrong times. And I’m […]
SaaS Metrics FAQs | What is Churn?
A little over two years ago, I published a series of well received articles on SaaS metrics that culminated in the SaaS Metrics Guide to SaaS Financial Performance. Since then, I’ve received numerous inquiries regarding the many practical quirks encountered in day-to-day SaaS metrics implementation. In response, I’ve decided to revisit the SaaS metrics topic […]
Managing Churn
On Sunday, February 13th, Enomaly Founder, CTO & Cloud Dude, Reuven Cohen, posted a link via his twitter account to a Telecomasia.net article in which the author (Camille Mendler) instructed the intended audience to “Stop aping Amazon, start boasting” – a reference to the fact that, if you are one of the big Telcos, you should really be trying to find a differentiator other […]
