Research shows that the most successful companies use benchmarking as a key management process and information tool. As your company develops its annual strategic plans and budget, it helps to understand where you stand relative to your peers and competitors. Deviating from benchmarks isn’t good or bad: But it is important to know why and by how much you deviate in order to test and justify your decisions.
OPEXEngine Founder and CEO Lauren Kelley delivered this “Data-Driven Decision Making” presentation to an audience of over 100 CFOs at an invitation-only event hosted by General Catalyst Partners, a Boston-based venture firm on 19-Oct-2011.
At Totango, we’ve developed a framework – the Customer Retention Cost (CRC) and the CRC Ratio – to assess and benchmark customer retention efforts in the industry. This is a critical missing component in the portfolio of metrics that SaaS executives, Boards, and investors should track and measure.
Insights Success has shortlisted "20 Most Admired Companies of the Year 2019 with an intent to acknowledge & admire the novel approaches of these businesses
Mine the Gold You Already Have! 5 Steps to Better Strategic Account Management.Revegy, Inc.
Why waste precious time managing endless spreadsheets and presentation decks when you could be utilizing strategic technology to drive strategic results. This Revinar addresses how your team can collaborate efficiently to drive significant increases in revenue from your customer base.
The Revenue Operations to Revenue Acceleration Framework Every Modern Busines...RocketSource
There is no silver bullet that can get brands to revenue acceleration. Instead, companies have to build a strong revenue operations infrastructure based on empathetic customer experience initiatives, intelligent data ops, and innovative content generation. Once you start with the end in mind, your organization can get to a sustainable — and much more feasible — revenue acceleration solution.
1. Background
2. Return on Investment for Lead Generation
3. Lead Generation Survey Research
4. Effective Lead Generation Strategies
5. Outsourcing Online Lead Generation
6. Lead Generation Essentials
7. Finding Quality Lead Suppliers
8. AchievingYour Best ROI
Saas Business Model: Unlocking Infinite Business PossibilitiesFredReynolds2
The Software-as-a-Service (Saas) industry emerged in 2005 and has since witnessed remarkable growth. Substantial investments are now being made in Saas business model startups, which have a promising chance of success if they meet market demands. This sector is experiencing exponential expansion as more time and money flow into it.
SaaS (Software as a Service) has singlehandedly emerged as the single largest disruption in business model in the last decade. SaaS companies suddenly made available enterprise quality technology to people (and businesses) across the world. SaaS public companies made ~$70Bn (at a ~70% gross profit) while adding ~$700Bn in MCap on the Nasdaq.
But there is one thing that sets SaaS apart. A 70% gross profit means that the every $1 of revenue can add $0.70 to your profits & $9.5 to your enterprise value. Which makes for – Pricing, the single largest needle spinner (after the product and service, of course) in a SaaS companies life. Looking for that one small thing that makes a big change? Start here.
Disclaimer: Please note that these are our views are based on our experience in being advisors and working hands-on with various organizations. They are for the limited purpose of educating the leaders of a company. The rationale and the procedure to be followed can vary significantly based on the context, stage, exact nature & size of the business.
When it comes to scrutinizing costs, most insurance companies can say “Been there, done that. Got the t-shirt.” Managers are familiar with the refrain from above to trim here and cut there. The typical result is flirtation with the latest management trends like lean, outsourcing and offshoring, and others. However, the results tend to be the same. Budgets reflect last year’s spend plus or minus a couple of percent in the same places.
What impact does Customer Management have on Business PerformanceDoug Leather
We know intuitively that managing the customer portfolio well leads to improved business performance. This slide deck shares important insights into what makes customer management work and how to measure it. This is based on research done by QCi (the main players now with The Customer Framework Ltd) and although I put this deck together 6 years ago I was astounded as to how relevant the thinking still is. The sad reality is that Customer Management capability hasn't improved very much over the years (in the majority of cases, hence we are still subject to inconsistent and poor customer experience) yet it remains a topic that is spoken about and focussed upon by many organisations. The difference that I find today versus 7 or 8 years ago is that MORE people talk about customer management than previously, however I don't se much improvement in the understanding of what it involves or much improved capability in operationalizing customer centric business.(this is a generalised statement)
At Totango, we’ve developed a framework – the Customer Retention Cost (CRC) and the CRC Ratio – to assess and benchmark customer retention efforts in the industry. This is a critical missing component in the portfolio of metrics that SaaS executives, Boards, and investors should track and measure.
Insights Success has shortlisted "20 Most Admired Companies of the Year 2019 with an intent to acknowledge & admire the novel approaches of these businesses
Mine the Gold You Already Have! 5 Steps to Better Strategic Account Management.Revegy, Inc.
Why waste precious time managing endless spreadsheets and presentation decks when you could be utilizing strategic technology to drive strategic results. This Revinar addresses how your team can collaborate efficiently to drive significant increases in revenue from your customer base.
The Revenue Operations to Revenue Acceleration Framework Every Modern Busines...RocketSource
There is no silver bullet that can get brands to revenue acceleration. Instead, companies have to build a strong revenue operations infrastructure based on empathetic customer experience initiatives, intelligent data ops, and innovative content generation. Once you start with the end in mind, your organization can get to a sustainable — and much more feasible — revenue acceleration solution.
1. Background
2. Return on Investment for Lead Generation
3. Lead Generation Survey Research
4. Effective Lead Generation Strategies
5. Outsourcing Online Lead Generation
6. Lead Generation Essentials
7. Finding Quality Lead Suppliers
8. AchievingYour Best ROI
Saas Business Model: Unlocking Infinite Business PossibilitiesFredReynolds2
The Software-as-a-Service (Saas) industry emerged in 2005 and has since witnessed remarkable growth. Substantial investments are now being made in Saas business model startups, which have a promising chance of success if they meet market demands. This sector is experiencing exponential expansion as more time and money flow into it.
SaaS (Software as a Service) has singlehandedly emerged as the single largest disruption in business model in the last decade. SaaS companies suddenly made available enterprise quality technology to people (and businesses) across the world. SaaS public companies made ~$70Bn (at a ~70% gross profit) while adding ~$700Bn in MCap on the Nasdaq.
But there is one thing that sets SaaS apart. A 70% gross profit means that the every $1 of revenue can add $0.70 to your profits & $9.5 to your enterprise value. Which makes for – Pricing, the single largest needle spinner (after the product and service, of course) in a SaaS companies life. Looking for that one small thing that makes a big change? Start here.
Disclaimer: Please note that these are our views are based on our experience in being advisors and working hands-on with various organizations. They are for the limited purpose of educating the leaders of a company. The rationale and the procedure to be followed can vary significantly based on the context, stage, exact nature & size of the business.
When it comes to scrutinizing costs, most insurance companies can say “Been there, done that. Got the t-shirt.” Managers are familiar with the refrain from above to trim here and cut there. The typical result is flirtation with the latest management trends like lean, outsourcing and offshoring, and others. However, the results tend to be the same. Budgets reflect last year’s spend plus or minus a couple of percent in the same places.
What impact does Customer Management have on Business PerformanceDoug Leather
We know intuitively that managing the customer portfolio well leads to improved business performance. This slide deck shares important insights into what makes customer management work and how to measure it. This is based on research done by QCi (the main players now with The Customer Framework Ltd) and although I put this deck together 6 years ago I was astounded as to how relevant the thinking still is. The sad reality is that Customer Management capability hasn't improved very much over the years (in the majority of cases, hence we are still subject to inconsistent and poor customer experience) yet it remains a topic that is spoken about and focussed upon by many organisations. The difference that I find today versus 7 or 8 years ago is that MORE people talk about customer management than previously, however I don't se much improvement in the understanding of what it involves or much improved capability in operationalizing customer centric business.(this is a generalised statement)
Simply put, SaaS businesses are traded on a multiple of Annualized Recurring Revenue (ARR). All the other drivers of valuation are tied back to this benchmark in order to support a higher or lower multiple.
This is a summary of these drivers pulled from a series of white papers published by SaaS Capital.
read more at www.saas-capital.com
How to Drive Top-Line Growth with Customer Success Management MetricsGainsight
This presentation is all about growing your top-line revenue by leveraging Customer Success Management metrics.
The most successful Enterprise SaaS companies know that growing revenue only through new customer acquisition is the less efficient way to scale. Rather, they understand that growing revenue within your existing customer base - through up-sells, cross-sells, and expanded use - is the most profitable way to scale.
In fact, Enterprise SaaS companies that grow revenue - and company valuation - by expanding revenue within their existing customer base also know the key to making this work is to focus on - and operationalize - Customer Success.
Digital Leadership Interview : Claus Von Riegen, VP and Head of BMI at SAPCapgemini
"Disrupt yourself before being disrupted by others. But to make this happen, you have to create a separate team with the explicit mandate to disrupt the business and make it a priority."
Stepping into a role which requires business finance knowledge? Here is a short guide offering advice, tools, and expertise that you will need to equip yourself with to be successful. Check out our Diploma in Business Finance for more.
Bootstrap, Angel or Venture: Determining the Right Financing Strategy for You...Judy Loehr
This presentation was shared at Dreamforce 2016 to help early-stage cloud business application startup teams understand how investors will evaluate their markets so they can plan the right financing strategy from the beginning.
This document brings together a set
of latest data points and publicly
available information relevant for
Platforms & Applications Industry.
We are very excited to share this
content and believe that readers will
benefit from this periodic publication
immensely.
With a fundamental shift in the CFO mission, the finance function has become a critical change agent across organizations. The role of financial leaders such as CFOs is evolving, from a traditional financial controller, to one that drives performance improvements across the organization.
USDA Loans in California: A Comprehensive Overview.pptxmarketing367770
USDA Loans in California: A Comprehensive Overview
If you're dreaming of owning a home in California's rural or suburban areas, a USDA loan might be the perfect solution. The U.S. Department of Agriculture (USDA) offers these loans to help low-to-moderate-income individuals and families achieve homeownership.
Key Features of USDA Loans:
Zero Down Payment: USDA loans require no down payment, making homeownership more accessible.
Competitive Interest Rates: These loans often come with lower interest rates compared to conventional loans.
Flexible Credit Requirements: USDA loans have more lenient credit score requirements, helping those with less-than-perfect credit.
Guaranteed Loan Program: The USDA guarantees a portion of the loan, reducing risk for lenders and expanding borrowing options.
Eligibility Criteria:
Location: The property must be located in a USDA-designated rural or suburban area. Many areas in California qualify.
Income Limits: Applicants must meet income guidelines, which vary by region and household size.
Primary Residence: The home must be used as the borrower's primary residence.
Application Process:
Find a USDA-Approved Lender: Not all lenders offer USDA loans, so it's essential to choose one approved by the USDA.
Pre-Qualification: Determine your eligibility and the amount you can borrow.
Property Search: Look for properties in eligible rural or suburban areas.
Loan Application: Submit your application, including financial and personal information.
Processing and Approval: The lender and USDA will review your application. If approved, you can proceed to closing.
USDA loans are an excellent option for those looking to buy a home in California's rural and suburban areas. With no down payment and flexible requirements, these loans make homeownership more attainable for many families. Explore your eligibility today and take the first step toward owning your dream home.
how to sell pi coins at high rate quickly.DOT TECH
Where can I sell my pi coins at a high rate.
Pi is not launched yet on any exchange. But one can easily sell his or her pi coins to investors who want to hold pi till mainnet launch.
This means crypto whales want to hold pi. And you can get a good rate for selling pi to them. I will leave the telegram contact of my personal pi vendor below.
A vendor is someone who buys from a miner and resell it to a holder or crypto whale.
Here is the telegram contact of my vendor:
@Pi_vendor_247
Poonawalla Fincorp and IndusInd Bank Introduce New Co-Branded Credit Cardnickysharmasucks
The unveiling of the IndusInd Bank Poonawalla Fincorp eLITE RuPay Platinum Credit Card marks a notable milestone in the Indian financial landscape, showcasing a successful partnership between two leading institutions, Poonawalla Fincorp and IndusInd Bank. This co-branded credit card not only offers users a plethora of benefits but also reflects a commitment to innovation and adaptation. With a focus on providing value-driven and customer-centric solutions, this launch represents more than just a new product—it signifies a step towards redefining the banking experience for millions. Promising convenience, rewards, and a touch of luxury in everyday financial transactions, this collaboration aims to cater to the evolving needs of customers and set new standards in the industry.
how can i use my minded pi coins I need some funds.DOT TECH
If you are interested in selling your pi coins, i have a verified pi merchant, who buys pi coins and resell them to exchanges looking forward to hold till mainnet launch.
Because the core team has announced that pi network will not be doing any pre-sale. The only way exchanges like huobi, bitmart and hotbit can get pi is by buying from miners.
Now a merchant stands in between these exchanges and the miners. As a link to make transactions smooth. Because right now in the enclosed mainnet you can't sell pi coins your self. You need the help of a merchant,
i will leave the telegram contact of my personal pi merchant below. 👇 I and my friends has traded more than 3000pi coins with him successfully.
@Pi_vendor_247
US Economic Outlook - Being Decided - M Capital Group August 2021.pdfpchutichetpong
The U.S. economy is continuing its impressive recovery from the COVID-19 pandemic and not slowing down despite re-occurring bumps. The U.S. savings rate reached its highest ever recorded level at 34% in April 2020 and Americans seem ready to spend. The sectors that had been hurt the most by the pandemic specifically reduced consumer spending, like retail, leisure, hospitality, and travel, are now experiencing massive growth in revenue and job openings.
Could this growth lead to a “Roaring Twenties”? As quickly as the U.S. economy contracted, experiencing a 9.1% drop in economic output relative to the business cycle in Q2 2020, the largest in recorded history, it has rebounded beyond expectations. This surprising growth seems to be fueled by the U.S. government’s aggressive fiscal and monetary policies, and an increase in consumer spending as mobility restrictions are lifted. Unemployment rates between June 2020 and June 2021 decreased by 5.2%, while the demand for labor is increasing, coupled with increasing wages to incentivize Americans to rejoin the labor force. Schools and businesses are expected to fully reopen soon. In parallel, vaccination rates across the country and the world continue to rise, with full vaccination rates of 50% and 14.8% respectively.
However, it is not completely smooth sailing from here. According to M Capital Group, the main risks that threaten the continued growth of the U.S. economy are inflation, unsettled trade relations, and another wave of Covid-19 mutations that could shut down the world again. Have we learned from the past year of COVID-19 and adapted our economy accordingly?
“In order for the U.S. economy to continue growing, whether there is another wave or not, the U.S. needs to focus on diversifying supply chains, supporting business investment, and maintaining consumer spending,” says Grace Feeley, a research analyst at M Capital Group.
While the economic indicators are positive, the risks are coming closer to manifesting and threatening such growth. The new variants spreading throughout the world, Delta, Lambda, and Gamma, are vaccine-resistant and muddy the predictions made about the economy and health of the country. These variants bring back the feeling of uncertainty that has wreaked havoc not only on the stock market but the mindset of people around the world. MCG provides unique insight on how to mitigate these risks to possibly ensure a bright economic future.
how to sell pi coins in South Korea profitably.DOT TECH
Yes. You can sell your pi network coins in South Korea or any other country, by finding a verified pi merchant
What is a verified pi merchant?
Since pi network is not launched yet on any exchange, the only way you can sell pi coins is by selling to a verified pi merchant, and this is because pi network is not launched yet on any exchange and no pre-sale or ico offerings Is done on pi.
Since there is no pre-sale, the only way exchanges can get pi is by buying from miners. So a pi merchant facilitates these transactions by acting as a bridge for both transactions.
How can i find a pi vendor/merchant?
Well for those who haven't traded with a pi merchant or who don't already have one. I will leave the telegram id of my personal pi merchant who i trade pi with.
Tele gram: @Pi_vendor_247
#pi #sell #nigeria #pinetwork #picoins #sellpi #Nigerian #tradepi #pinetworkcoins #sellmypi
How to get verified on Coinbase Account?_.docxBuy bitget
t's important to note that buying verified Coinbase accounts is not recommended and may violate Coinbase's terms of service. Instead of searching to "buy verified Coinbase accounts," follow the proper steps to verify your own account to ensure compliance and security.
Falcon stands out as a top-tier P2P Invoice Discounting platform in India, bridging esteemed blue-chip companies and eager investors. Our goal is to transform the investment landscape in India by establishing a comprehensive destination for borrowers and investors with diverse profiles and needs, all while minimizing risk. What sets Falcon apart is the elimination of intermediaries such as commercial banks and depository institutions, allowing investors to enjoy higher yields.
Currently pi network is not tradable on binance or any other exchange because we are still in the enclosed mainnet.
Right now the only way to sell pi coins is by trading with a verified merchant.
What is a pi merchant?
A pi merchant is someone verified by pi network team and allowed to barter pi coins for goods and services.
Since pi network is not doing any pre-sale The only way exchanges like binance/huobi or crypto whales can get pi is by buying from miners. And a merchant stands in between the exchanges and the miners.
I will leave the telegram contact of my personal pi merchant. I and my friends has traded more than 6000pi coins successfully
Tele-gram
@Pi_vendor_247
how to swap pi coins to foreign currency withdrawable.DOT TECH
As of my last update, Pi is still in the testing phase and is not tradable on any exchanges.
However, Pi Network has announced plans to launch its Testnet and Mainnet in the future, which may include listing Pi on exchanges.
The current method for selling pi coins involves exchanging them with a pi vendor who purchases pi coins for investment reasons.
If you want to sell your pi coins, reach out to a pi vendor and sell them to anyone looking to sell pi coins from any country around the globe.
Below is the contact information for my personal pi vendor.
Telegram: @Pi_vendor_247
Introduction to Indian Financial System ()Avanish Goel
The financial system of a country is an important tool for economic development of the country, as it helps in creation of wealth by linking savings with investments.
It facilitates the flow of funds form the households (savers) to business firms (investors) to aid in wealth creation and development of both the parties
when will pi network coin be available on crypto exchange.DOT TECH
There is no set date for when Pi coins will enter the market.
However, the developers are working hard to get them released as soon as possible.
Once they are available, users will be able to exchange other cryptocurrencies for Pi coins on designated exchanges.
But for now the only way to sell your pi coins is through verified pi vendor.
Here is the telegram contact of my personal pi vendor
@Pi_vendor_247
The secret way to sell pi coins effortlessly.DOT TECH
Well as we all know pi isn't launched yet. But you can still sell your pi coins effortlessly because some whales in China are interested in holding massive pi coins. And they are willing to pay good money for it. If you are interested in selling I will leave a contact for you. Just telegram this number below. I sold about 3000 pi coins to him and he paid me immediately.
Telegram: @Pi_vendor_247
2. We all think that we are incredibly rational in our decision-making, open to new
information, always searching for the best answer regardless of where it takes
us, but the reality is that we tend to have blinders on based on how we’ve
always done things and past experience. This has often been the case in
software management. Recently, though, there’s been a shift in management
away from basing decisions on “gut instinct” and what one Microsoft
researcher called: “HiPPOs” or Highest Paid Person’s Opinions.
Prof. Erik Brynjolfsson at MIT/Sloan has been doing work with very large firms
showing that a one standard-deviation increase toward data and analytics
correlates with a 5-6 percent improvement in productivity and a slightly larger
increase in profitability in those same firms. After benchmarking hundreds of
fast growth software firms over the past 5 years, I would venture to suggest
that with smaller companies, an even stronger result can be seen in
management efficiency, productivity and minimizing risk, as well as making
faster course corrections along the path to growth.
2
3. Research shows that the most successful companies use metrics and benchmarking
as a key management process and information tool. The popularity of benchmarking
in this country originally grew out of the manufacturing world, especially in looking at
Japanese manufacturing and comparing best practices. Benchmarking didn’t really
take off in the software industry, or at least for budgeting and management
processes, but was applied to some extent in the software development area to
benchmark the coding and testing process.
After the disruptions of the 2001 and 2008 economic downturns, with the rise of the
SaaS business model, plus extensive use and experience with affordable financial
applications, CRM and other analytics tools, software companies are embracing
benchmarking and metrics today. Especially SaaS vendors. And the investment
community and external shareholders require good data and good peer comparisons
– they are looking at it themselves – to support investments in software ventures.
Evidence of data-driven decision making, and a good grasp of key metrics in a
company helps drive the value of that company, especially any private company.
We find in our own work that our clients that are the most driven to examine the data,
metrics and comparisons, are the ones that tend to perform the best and have the
highest revenue growth. Because we see their data, I know this is a fact; we see that
every day.
Benchmarking has its limits, but is a useful tool to drive decisions based on data
rather than by intuition or how things were done at somebody’s last company. I
always tell companies that deviating from the benchmarks isn’t good or bad, it is just
important to understand how and why you are deviating from a benchmark so that
you are choosing to be higher or lower to fit your particular business, rather than not
even knowing what the benchmark is.
3
4. SaaS is all about the numbers. As the SaaS business has evolved,
management has had to dig deeply into the numbers to track how resource
investments are paying off, and how customer numbers are growing, while
examining in detail the cost of acquiring and maintaining a customer. SaaS,
as you all know, is a trickier investment upfront because the vendor has to
build a great product which is turn key for the user, take care of all
infrastructure investments, and get paid on a subscription basis, not all up
front. Gone are the good old days when it was all about building a really cool
product and selling the heck out of it by whatever means possible and moving
on to the next customer. And gone are the days when your customers were
your beta testers and the testers for a variety of environments.
But, with SaaS, gone are the days when you had to start each quarter at zero
and run til you dropped at midnight on the last day of the quarter. So, once
you get past the initial hurdles and get to a scaleable model, a profitable
recurring revenue stream in a SaaS company is very profitable and highly
valuable. The question is: how do you navigate the hurdles to get from start up
to a profitable recurring revenue stream and solid, growing business.
4
5. In early stage companies which are still building products, the key metrics for those
companies are around the overall cash burn, cost per employee, and relative costs by
function. For early revenue and early stage companies that are still defining their target
customer profile, and business model, these metrics are important to track closely to ensure
the company has the runway to get to the next stage where it can scale the business.
As the business scales, companies tend to focus mostly on operating expense by department
– what’s the right expenditure on sales, on marketing, on G&A, on support, on R&D at a
particular stage of the company. And companies need to get into greater detail than just the
macro expense per department.
One area that doesn’t get talked about enough where we see companies having to focus on
even as they scale is hosting expense and the cost to maintain a customer. Hosting expense
has come down with the availability of services in the cloud, - for example, this past year, we
found small, private SaaS companies (about $8.5M revenues) spending 3.6% of revenue
on hosting expense, while even in 2009, companies roughly the same size were
spending 8-9% of revenue on hosting expense.
Hosting expense doesn’t seem to have a nice economy of scale trend line down evenly as the
company grows, typically, it goes up as revenue and the number of customer grows, and then
at a point which varies for different types of applications and models, starts to achieve some
economy of scale, but hits bumps as additional data centers are built out, or availability,
security issues, etc. are expanded.
5
6. In the early stages of a SaaS company, cash flow is THE critical metric to
track. We’ve watched as SaaS companies have learned to conserve cash
flow over the years, from 2007 and 2008 when the SaaS model was taking off
and companies, especially venture-backed firms, had around 8% negative
cash flow as a percent of revenue, which went up in 2009 as the recession
took hold, but by 2010, we saw early stage companies getting on top of cash
management and becoming almost cash flow positive (and since this is an
average, many were cash flow positive) by the end of 2010.
6
7. Here’s data over time for larger SaaS companies, comparing 2010 and 2008,
one peer group averaging $57M and another averaging $61M – so roughly
similar in size. 2008 was a year of spending and growth for a lot of venture-
backed software companies as budgets had been set to expect high growth
even though the recession was getting started, as compared to 2010 when
companies were clearly more careful about spending, even though the
economy, especially markets for successful Saas companies, seems to have
improved. Generally, SaaS companies are showing greater efficiency
reflecting more conservative cash management. Even Successfactors
(SFSF), which as a public company in 2008 at $112M spent 105% of revenue
on SG&A, brought that down to 66% of revenue in 2010 (while doubling
revenue during that time period).
The largest public SaaS companies in 201 showed a large increase in cash
growth, averaging 17.5% cash from operations as a % of revenue. This
benchmark is for companies averaging $186M in 2010 revenues.
7
8. Lets look at the key metrics for SaaS companies: customer metrics. In an early
stage company with early customers, the critical metrics to watch are around the cost
of customer acquisition (coca), cost of sale, average deal size, implementation
costs, and costs of maintaining the customer. The key focus for this phase of the
business is to develop a solid and repeatable sales model that can bring the company
to profitability and growth.
One of the metrics which is well discussed in SaaS circles is the “Magic
Number”described by Josh James, CEO of Omniture at an industry summit to explain
how Ominiture tracked their customer profitability and whether or not to add gas in
Sales & Marketing, or not. Basically, you take a quarter’s incremental revenue
growth, multiple by 4 to annualize, then divide by last quarter’s S&M marketing
spend. According to James, anytime the magic number is .75 then you should spend
more and put gas on your sales and marketing to bring in more customers. If your
magic number is 0.5 or less, then there is something wrong with your model. Again,
the key is watching your sales and marketing spend, and revenue growth.
One assumption in this model is that you have very low Churn rates, Omniture was
shooting for 95% renewals or better. The industry average is about 15% churn or
less. We look at both customer renewal rates by number of customers renewing and
by amount of dollars renewed. For example, if you had 100 customers up for renewal
for contracts totalling $10M, and all 100 customers renew, you have a 100% renewal
rate, but they renewed contracts now totalling only $8M, you have an 80% renewal
rate by dollar value (or conversely, they renewed for a total value of $12M, yo u have
a renewal rate of 120%. You can see these benchmarks in the next two slides
8
8
9. Here we have customer renewal rates for smaller, private companies and
larger public companies in 2010 and for small versus larger companies in
2009. As you can see, the renewal rates by customer is higher for the larger
companies, which makes sense as they presumably know their market and
target customers better, so are more likely to keep them, and they have better
resources to support their customers, also helping them keep them. Also, we
tend to find that companies selling subscriptions at a higher average contract
size, for example, over $100k/annually per customer, have less churn than
companies selling a low average contract size.
9
10. We typically see renewals by dollar value being slightly higher than the
number of customers renewing. This means that companies are maintaining
the value of contracts and increasing them.
10
11. I spent 20 years building businesses for small and large companies, in the PC
software world, in enterprise software and internet infrastructure and
applications and I wish that I had had better information as I was making
decisions, so I started OPEXEngine. We started by developing our own
content through the confidential software benchmarking, and now are starting
to develop information products incorporating a variety of data sources, but all
focused on the small and mid-sized corporate market and giving executives
data reports so that you can spend more time analyzing and making informed
decisions, instead of spending a lot of time and personnel resource compiling
data.
11
11
12. I’d like to encourage that all of you that are building your software company participate in our
next confidential software benchmarking which annually takes place in the Feb/March
timeframe and will cover the previous year’s financial and operating data. We include
companies from $1M to $350M in revenues, so this obviously includes private and public
companies. Over a hundred software companies participate by inputting their data directly into
our secure on-line system. We have a team of accountants and statisticians who help us clean
and sort the data, and we have been doing this for 5 years now, so we have an extensive
database with over 50,000 data points.
Participating companies receive an individual company report, which shows their data against
several peer groups. We look at the data not just by similar sized companies, but companies
with similar types of business models. For example, companies selling SaaS applications to
thousands of customers at a low price point with an inbound internet marketing strategy,
versus a peer group of companies with a higher price point selling more into the enterprise
space. Participating companies also receive the overall Software Industry Benchmarking
Report and we’ve just built out a new interactive custom benchmarking system for participating
companies.
Last year, benchmarking participation cost $999 for companies under $10M, and $1995 for
companies over $10M. Many participants have told me they have easily saved the
participation price through looking at peer expense benchmarks. But more importantly,
companies use the metrics as part of on-going management, which has a far greater value.
Please register at: www.opexengine.com/register if you are interested in being informed
about participating in the 2012 benchmarking.
We work with CFOs and CEOs, as well as investors to define the most useful software and
SaaS metrics to track each year. I invite you to participate, and also to help us define which
benchmarks are most important for you to track in growing your business. Please feel free to
contact me directly at: lauren@opexengine.com Thank you.
12