💥Upgrading Customers to Annual, Rewarding Top-Performers, Founders Churn, SaaS Billing Strategies & More!
Digesting Insights From the Data
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The Right Time to Push Customers for an Upgrade from Monthly to Annual Plans
Kyle Poyar summarizes new data from ChartMogul, analyzing billing behaviour across 2,500+ SaaS companies. Contrary to popular belief, the best time to push for annual upgrades isn’t months down the line but within the first few weeks of onboarding.
Upgrade Timing: Customers are 3–4x more likely to switch to annual plans in month 2 than in month 9, flipping the usual assumptions about upgrade windows.
Revenue Lift: Monthly plan NRR ranges from 43% (<$25 products) to 76% ($250–$500 products). Annual plans clock in 10–20 percentage points higher on average.
Monthly Plan Advantage: SaaS companies with 50%+ of customers on monthly plans tend to grow faster in the $0–$10M ARR stage, suggesting monthly isn’t just a trial step but a growth lever.
✈️ KEY TAKEAWAYS
Don’t wait to ask for the annual commitment. The highest conversion window is within the first month, not after six. And while annual plans drive higher retention, a strong monthly base can be just as critical for early-stage growth.
1 of 3 Co-Founders Leaves Within the First 6 Years
Peter Walker from Carta breaks down founder departure data from nearly 77,000 US startups founded between 2016 and 2024. His analysis excludes solo founders and focuses on VC- or angel-backed companies with SAFEs or Notes.
Early Exits Rising: Startups founded in recent years are seeing more cofounder exits in their first 1–3 years, a shift from earlier cohorts.
Year 4 Drop-Off: In the 2017 cohort, 20.3% of companies had lost a founder by year 4, aligning with typical vesting timelines and highlighting a key departure milestone.
Vesting Debates: With longer timelines for building venture-backed companies, there’s growing discussion about whether the standard 4-year founder vest should be extended to 6 years.
✈️ KEY TAKEAWAYS
Cofounder departures are trending upward in early startup years. As founders and investors navigate longer company-building journeys, equity vesting structures may need a rethink to reflect today’s startup reality.