SaaS Churn Rate Benchmarks 2025
Churn remains the defining metric separating SaaS winners from the rest. SMB-focused products face structurally higher monthly churn (3–5%) due to shorter decision cycles and tighter budgets, while enterprise-oriented products can sustain sub-1% monthly rates. The data consistently shows that companies crossing $10M ARR with churn above 2% monthly are in a value-destruction spiral — expansion revenue rarely compensates for that level of attrition. Vertical SaaS products serving regulated industries (legal, healthcare, fintech) routinely post the lowest churn numbers, often half the median of horizontal tools. The message from the data: churn is a product problem wearing a revenue costume.
| Metric | Value | Source | Year | Context |
|---|---|---|---|---|
| Median Monthly Churn Rate (SMB)SMB | 3.2% | ChartMogul SaaS Benchmarks 2024 | 2024 | SMB churn is structurally elevated due to budget sensitivity; anything below 2% monthly is genuinely exceptional for this segment. |
| Median Monthly Churn Rate (Mid-Market)Mid-Market | 1.0% | ChartMogul SaaS Benchmarks 2024 | 2024 | Mid-market products hitting sub-1% monthly churn are on a trajectory toward strong NRR — the threshold where net new ARR compounds reliably. |
| Median Monthly Churn Rate (Enterprise)Enterprise | 0.5% | KeyBanc Capital Markets SaaS Survey 2024 | 2024 | Enterprise churn this low often reflects multi-year contracts — true economic churn may be masked until renewal cycles. |
| Annual Churn Rate, ARR $1M–$5M | 13.2% | ChartMogul SaaS Benchmarks 2024 | 2024 | Early-stage products face high annual churn as product-market fit is still being refined and customer selection is often imprecise. |
| Annual Churn Rate, ARR $5M–$15M | 8.8% | ChartMogul SaaS Benchmarks 2024 | 2024 | Companies in this band who can push annual churn below 8% are well-positioned for Series B fundraising conversations. |
| Annual Churn Rate, ARR $15M–$30M | 6.5% | ChartMogul SaaS Benchmarks 2024 | 2024 | At this ARR level, churn above 10% is a serious red flag signaling structural go-to-market or product-market fit issues. |
| Vertical SaaS Median Annual Churn | 5.1% | Bessemer Venture Partners State of the Cloud 2024 | 2024 | Vertical SaaS companies benefit from higher switching costs and workflow embedding, producing structurally lower churn than horizontal competitors. |
| Horizontal SaaS Median Annual Churn | 10.2% | Bessemer Venture Partners State of the Cloud 2024 | 2024 | Horizontal tools compete in crowded categories where substitution risk is high; differentiation on core workflows is the primary defense. |
Methodology
Data aggregated from ChartMogul SaaS Benchmarks Report (n=2,100+ companies), KeyBanc Capital Markets SaaS Survey, and Pacific Crest SaaS Survey annual releases. Figures reflect median values unless otherwise noted.