Reflections on Corevist’s NRR (net recurring revenue)
All SaaS companies are constantly evaluating their churn (the rate at which clients leave). Where churn is low, customer loyalty is high. The greater the churn is, the more your value prop is put into question. Why are people leaving? Do you really have a solution?
Whether your churn is low or high, it’s a leading indicator of the future health of your company.
If you’re about to invest with Corevist by becoming a client, our churn can tell you a lot—not only about our product, Corevist Commerce, but about the experience of working with our team across the life of your web channel.
So let’s look at Corevist’s churn, and let’s quantify it. In my opinion, the best metric for churn is annual NRR (net recurring revenue).
Annual NRR: What it means
This metric, expressed as a percent, indicates how much recurring revenue we retained from one year to the next. For example, 100% net recurring revenue means there was no change between the two years. That could mean we didn’t gain or lose any recurring revenue. It could also mean we lost a certain amount and gained the same, so there was no net gain or loss.
My favorite analogy here is a bathtub. 100% means you’re filling the tub just as fast as it’s draining. Over 100% means you’re filling it faster than it’s draining, and under 100% means it’s draining faster than it’s filling. Pretty self-explanatory.
Industry benchmark: 106.5% is decent for public SaaS companies
Crunchbase studied 36 publicly-traded SaaS companies at the time of IPO. These companies averaged 106.5% NRR when they first went public, with that average falling to 104% at the time of writing.
So it’s safe to say that in the SaaS industry, “just barely adding water to the tub” is a fairly decent standard.
It’s worth noting, too, that many companies in Crunchbase’s study posted shrinking NRR at the time of their IPO—including big names like SurveyMonkey (95%), HubSpot (92.7%), and Dropbox (90%).
Keep this benchmark in mind as we turn to Corevist’s numbers.
Our NRR performance: 124% average
Here are Corevist’s NRR numbers for the last 9 years:
- 2011 – 118%
- 2012 – 150%
- 2013 – 149%
- 2014 – 140%
- 2015 – 101%
- 2016 – 133%
- 2017 – 120%
- 2018 – 90%
- 2019 – 117%
- AVG – 124%*
*Quick note—this average does not include 2009 and 2010, our first two years in business in which we could’ve calculated NRR. We had great success as a startup. Manufacturers just loved our software, and we grew fast without losing any clients. Including those first two years skewed our average NRR much higher, so I took them out.
These numbers give me immense pride. 😊 If we were qualified for the Crunchbase survey, we would appear in the top 5 companies, ahead of names like Shopify, Mulesoft, Docusign, and Yext. And we’ve done it all without accepting funding (yet). That’s pretty amazing.
It’s also worth noting that our NRR tracks with our four Inc 5000 wins. This indicates that not only are people not leaving, they’re also growing their use of Corevist, scaling our solution to new geographies and business units. I love this fact because it validates our scalable approach to ecommerce architecture. It means that manufacturers need an efficient approach to global ecommerce–and it means we’re delivering.
1. Our clients continue to vote YES on Corevist’s value proposition
That number, 124%, is telling us that we’re doing well on a bunch of fronts. Not only are people not leaving, but new people are choosing Corevist, and our existing clients are growing their use of the platform.
That’s a vote of confidence in our product, our process, and our people. We’re forever indebted to everyone at Corevist for delivering at such a high standard—and we’re indebted to our clients for trusting us and empowering us to serve them.
2. Our track record validates our commitment to our clients
We’ve been in this business for 12 years. That validates not only the investments we’re making in product, people, and processes, but ALSO the investments we’re making in our relationships with our clients.
We wouldn’t have these strong relationships if we didn’t hold ourselves accountable to our core values. So our NRR average of 124% validates our discipline and professionalism, too.
3. We can’t rest on our laurels
At Corevist, it’s not enough to succeed in the past or “have a good run.” We’re committed to delivering NEW value to our clients through ongoing innovation in our core product, Corevist Commerce.
To that end, we’ve got all kinds of irons in the fire for 2020, both in our product and our evolving relationship to the market:
- B2B is complex, and we’re constantly striving to make it easier for people to navigate that complexity. That’s why we’ll be rolling out an all-new user interface for Corevist Commerce in early 2020.
- We’re constantly on a lean/agile journey with our engineering team in Belarus. We’re striving to get more value in shorter periods of time as we move client requests into production, error-free. We’ve reported on that separately, and that initiative will continue into 2020.
- We’re evolving our payments offerings in 2020. We’re seeing more and more demand for Online Bill Pay solutions, and we’re going to expand our existing capabilities in web A/R to offer even more functionality.
- We’re also incubating a super duper top secret project that we’re hoping to pilot in the first half of 2020. It has something to do with the fact that it’s about time we put faxes out of their misery…don’t you think? 🙂
Moving forward: FREE case study
Wondering what Corevist Commerce looks like in real life? Download this case study on Blount International. You’ll learn how this leading industrial manufacturer launched Corevist and became Easier To Do Business With—all without increasing the workload of their IT team.