Enterprise SaaS companies have a problem if gross retention falls below 90%.
Frank Bien · 1013 Guess How This Data Tool Will Break $100m In 2018 · May 3, 2018 · at 11:21
Looker CEO Frank Bien shares his benchmark threshold for healthy gross customer retention in enterprise software.
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“I mean, you want to, you know, as a SaaS company, you know, playing in enterprise space, if you're more than 10%, losing more than 10% or below 90% overall, you know, from a gross retention, you have a problem.”
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LTV-to-CAC ratios are almost meaningless for evaluating SaaS companies.
“Yeah, I mean, like when you look at lifetime value and that kind of CAC ratio in a SaaS company, it's almost meaningless.”
Looker avoids the downmarket to target enterprise growth modeled on ServiceNow.
“Yeah, we probably don't chase down market very much. I think, you know, if you were to look at us, you'd say, hey, you know, let's be probably a little bit smaller, but let's go after something like ServiceNow.”
Looker's customer contracts range from $30,000 to $1 million annually.
“Yeah, I mean, our average customers, you know, the low end would be about 30,000 dollars a year, and the high end would be a million.”
Looker has reached between 1,200 and 1,300 total customers.
“Yeah, so we're about 1200 customers, maybe 1300 now, somewhere in there, but, you know, we're growing really nicely.”