Really cool post! Love the Regrettable and Non-Regrettable churn idea!
I also saw with many SaaS companies that they put a lot more effort in getting MQLs than in delighting existing customers. A lot of them need to understand that the essence of their business model is not to rotate customers, but to keep them paying for longer. If you can acquire new ones, great! More growth to you. But the essence is that recurring subscription that needs to happen.
This is a great post for auditors auditing SaaS companies to understand what is going on now and to test the forecast our clients show to us. Without keeping this mechanics explained here on mind, many of us will be easily misled by simple average churn rates.
Im not a business guy, but am fascinated by your topic, so forgive my ignorance. Are we watching an unprecedented churn play out in company virtue signaling right now? Some companies are going out of their way to insult their base.
Fantastic post as always! QQ, of a customer churns because they were acquired and have to adopt the acquiring companies SAAS product, is that considered unavoidable or avoidable churn?
I am a CSM and I have come across this situation a countless times..
Yeah, M&A is the most common instance where the company might not have much control, but people default to the answer of unavoidable too fast. Frequently in M&A the customer can keep your tool or even the acquirer May adopt it…so having a mindset that it isn’t always unavoidable is better imo
As a CS guy, this is really helpful context and analysis. Learned more here than I did in undergrad!
Glad you enjoyed it Brian!
Really impressed with your content. We clearly share many, many opinions!
Thanks, David! Yes, that’s why I enjoy reading your content too!
Thanks for the education. I work on M&A deals and find myself working on two SaaS deals now, which is not the norm. This is super helpful!
Nice reframing of churn. Articles like this give you a new vantage point.
Really cool post! Love the Regrettable and Non-Regrettable churn idea!
I also saw with many SaaS companies that they put a lot more effort in getting MQLs than in delighting existing customers. A lot of them need to understand that the essence of their business model is not to rotate customers, but to keep them paying for longer. If you can acquire new ones, great! More growth to you. But the essence is that recurring subscription that needs to happen.
This is a great post for auditors auditing SaaS companies to understand what is going on now and to test the forecast our clients show to us. Without keeping this mechanics explained here on mind, many of us will be easily misled by simple average churn rates.
Another excellent analysis of SaaS metrics and of how they can be easily misinterpreted and ultimately better understood.
Superb breakdown and beat down!
😁thanks!
What do you recommend doing to better calculate LTV then? How do you do personally do it?
Im not a business guy, but am fascinated by your topic, so forgive my ignorance. Are we watching an unprecedented churn play out in company virtue signaling right now? Some companies are going out of their way to insult their base.
Fantastic post as always! QQ, of a customer churns because they were acquired and have to adopt the acquiring companies SAAS product, is that considered unavoidable or avoidable churn?
I am a CSM and I have come across this situation a countless times..
Thanks for the insights, sir!
Yeah, M&A is the most common instance where the company might not have much control, but people default to the answer of unavoidable too fast. Frequently in M&A the customer can keep your tool or even the acquirer May adopt it…so having a mindset that it isn’t always unavoidable is better imo