In the first quarter of each year, SaaS Capital conducts a survey of B2B SaaS company metrics. This year’s study marked our 9th annual survey, and it
continues to grow with over 1,400 private B2B SaaS companies responding this year, making it the largest survey of its kind. Below are our findings on
It also needs to be explicitly noted that this data was collected in early 2020 and is based on 2019 performance metrics, before the impact of the COVID-19
pandemic. Benchmarking comparisons should be made to the same time period for your company.
2020 B2B SAAS RETENTION BENCHMARKS
Based on its compounding effect on growth, revenue retention is now well established as the most important metric for
ensuring medium- to long-term business health. New sale bookings versus revenue retention is the SaaS version of “offense
wins games, defense wins championships.” Due to its importance, we publish a lot of research on retention rates, and below is
our most recent survey data cross-referenced against other important figures like growth rate, funding, and business model.
First, let’s establish definitions. We asked companies to report their net and gross annual revenue retention data. Customer
account retention may be a useful metric for you to track, but our focus in the survey, and generally the retention metric we
think is the most important, is based on revenue. We define net retention as:
(Monthly Recurring Revenue in December of 2019 only from customers who were customers in December 2018)
(Total MRR in December 2018)
This number can be anything from 0% to well above 100%, as it includes up-sells, new product cross-sells, and price increases.
Annual gross retention is the same formula, excluding the upsells, cross-sells, and price increases. (For a fool-proof method, set