High client retention dramatically increases valuation by impacting;
- Revenue Level
- Growth Rate
- Profit Capacity
Consider the following:
Two companies have the same 20m in revenue and each is growing at 50% per year. Company 1 has a 5% churn and Company 2 has a 15% churn. At the end of five years Company 1 has $90M in revenue and Company 2 has $60M. Using a typical 5 times revenue for a SaaS company valuation, Company 1 is worth $150M more than Company 2.
For a demonstration and Best Practice Retention Accessment (BPRA) contact us at; email@example.com or 877-ZEBRAS-0