1. World-class churn
2. Revenue expansion from each cohort
3. Accelerating acquisition at the right time
3 Fundamental Growth Levers for SaaS
• 2-3% or less = on target
• 3-5% = not there yet, double down on product and onboarding
• 5-10% = Major P/M fit gap
• 10% and above = business is on fire
Monthly Churn Benchmarks
• Remove self-service cancellation
• Fix product onboarding
• Push annual plans
• Force annual plans
• Reaching out to inactive accounts
• Downsell campaigns
• Prioritize support for large accounts
• Onboarding programs with 30/60/90 goals
Popular churn reduction ideas
Bad Marginal Major Wins
Remove self-service cancellation Push annual plans Fix product onboarding
Contact inactive accounts
Support ticket prioritization
Improve product value
Downsell campaigns 30/60/90 onboarding programs
• Very disappointed
• Somewhat disappointed
• Not disappointed (it isn’t really that useful)
The P/M fit question from Sean Ellis:
How would you feel if you could no longer use [product]?
When seat pricing does NOT work
• Attendees = makes sense, easy upgrades
• Organizers = limits are annoying, resist upgrading
What is negative churn?
Revenue from each cohort expands faster than the revenue lost from that
cohort.
Let’s recap:
• We’ve focused heavily on P/M fit to get super low churn.
• We’ve found the pricing metric that easily convinces customers to pay more.
• Low churn + expansion revenue means we’re stable or growing without any acquisition.
• Now our acquisition is 100% upside.
Lots of lead gen paths:
• Inbound and content funnel
• Cold calling and outbound
• Events
• Partnerships
• Paid marketing
• PR
• Affiliates
• Viral loops
• Social
Funnel also suffers: the alligator sales funnel
Leads growing at 10% MOM, new customers constant at 100 per month
0
1,250
2,500
3,750
5,000
Jan Mar May Jul Sept Nov Jan Mar May July Sept Nov
Qualified leads New logos
1. Make sure you have P/M fit and low churn
2. Get cohort expansion in place with a great pricing metric
3. Build your lead gen machine at the right time
Your growth levers, step-by-step