To build a high-growth SaaS business, you need three growth levers working perfectly. If any of them aren’t working, your SaaS growth plateaus. You also need to build them in the right order. We’ll make sure your growth levers are healthy so you can keep adding momentum to your growth.

1. The Three SaaS Levers that Drive
Growth and Keep You From
Plateauing
Lars Lofgren

2. @larslofgren

3. I’ve built Growth Teams at:

4. 1. World-class churn
2. Revenue expansion from
each cohort
3. Accelerating acquisition at
the right time
3 Fundamental Growth Levers for SaaS

5. You plateau if all 3 don’t work together

6. Also plateau if you build in the wrong order

7. Conquering Churn

8. • 2-3% or less = on target
• 3-5% = not there yet, double down on product
and onboarding
• 5-10% = Major P/M fit gap
• 10% and above = business is on fire
Monthly Churn Benchmarks

9. • Remove self-service
cancellation
• Fix product onboarding
• Push annual plans
• Force annual plans
• Reaching out to inactive
accounts
• Downsell campaigns
• Prioritize support for
large accounts
• Onboarding programs
with 30/60/90 goals
Popular churn reduction ideas

10. Bad Marginal Major Wins
Remove self-service
cancellation
Push annual plans Fix product onboarding
Contact inactive
accounts
Support ticket
prioritization
Improve product
value
Downsell campaigns
30/60/90 onboarding
programs

11. Wait, what about forced
annual?

12. If there’s an established
norm of forced annual in
your category, use it.

13. Marketing automation has an established norm

14. Misapplied, forced annual drops your funnel off a cliff

15. Improving P/M fit and
onboarding are your most
reliable levers for churn.

16. • Very disappointed
• Somewhat disappointed
• Not disappointed (it isn’t really that useful)
The P/M fit question from Sean Ellis:
How would you feel if you could
no longer use [product]?

17. 40% of respondents should say “Very disappointed”
51% 72%

18. Cohort
Expansion

19. As customers grow revenue, so should you

20. Your expansion revenue
depends on the quality of
your pricing metric.

21. Salesforce seat metric is a cash machine

22. When seat pricing does NOT work
• Attendees = makes sense, easy upgrades
• Organizers = limits are annoying, resist upgrading

23. Match your pricing metric
as closely to your product
value as you can.

24. Expansion engine + low
churn = negative churn.

25. What is negative churn?
Revenue from each cohort
expands faster than the
revenue lost from that
cohort.

26. Let’s recap:
• We’ve focused heavily on P/M fit to get super
low churn.
• We’ve found the pricing metric that easily
convinces customers to pay more.
• Low churn + expansion revenue means we’re
stable or growing without any acquisition.
• Now our acquisition is 100% upside.

27. Acquisition

28. You should already have
steady organic growth by
now from P/M fit.

29. Lots of lead gen paths:
• Inbound and content
funnel
• Cold calling and
outbound
• Events
• Partnerships
• Paid marketing
• PR
• Affiliates
• Viral loops
• Social

30. All of these can work if you
get the execution right.
Hence the advice:
“double down”

31. 10% month over month
lead growth

32. What happens if we pursue
acquisition too early?

33. Acquisition can’t outrun high churn forever

34. If the majority of your
acquisition goes to
replacing lost MRR every
month, you will plateau.

35. Funnel also suffers: the alligator sales funnel
Leads growing at 10% MOM, new customers constant at 100
per month
0
1,250
2,500
3,750
5,000
Jan Mar May Jul Sept Nov Jan Mar May July Sept Nov
Qualified leads New logos

36. Marketing can dodge a bad product, sales can’t

37. The alligator funnel is nasty.
Marketing and sales will
blame each other.

38. Usually a product problem.
This is why we focus on
churn first.

39. 1.Make sure you have P/M fit and
low churn
2.Get cohort expansion in place
with a great pricing metric
3.Build your lead gen machine at
the right time
Your growth levers, step-by-step

40. Questions?
Lars Lofgren
@larslofgren
bit.ly/3-saas-levers