Tools

SaaS Valuation Calculator: How Churn, Growth Rate, and Profit Impacts Valuation

We've been through the trenches ourselves. First by selling our bootstrapped company, Wavve, to Calm Capital, and more recently raising $1.5 million for Churnkey’s growth. These experiences taught us what really drives investor value in the SaaS landscape.

Most SaaS valuation calculators focus only on growth rate and revenue. But they miss crucial elements like churn, business age, and owner dependency.

Our calculator isn’t built on theory alone; it’s shaped by real-world insights from our own journey and informed by FE International's extensive valuation expertise.

SaaS Valuation Calculator With More Metrics

This SaaS valuation calculator zeroes in on what buyers and investors care about. Read more about the inputs we included or skip this section to go straight to the SaaS valuation calculator.

Churn Rate Reflects Customer Loyalty: Churn rate is a big deal. High churn signals that your product might not fit the market well or that competition is fierce—think seasonal industries like recruitment. But it varies by segment: smaller businesses often have higher churn (3-7% monthly), while enterprise-grade companies see much lower rates. Even a small change in churn can impact valuation. Read Maximum Viable Churn by Tomasz Tungaz and how SaaS valuations are impacted by churn if you're curious.
Age Brings Stability: If your business has been around for three years or more, buyers will see it as stable and reliable. Younger companies can still attract interest, but they'll need to demonstrate rapid growth to stand out.
CAC to LTV Ratio Shows Profitability: This metric proves your growth strategy is paying off by comparing how much it costs to acquire a customer to the revenue they generate over their lifetime. A solid 3:1 ratio means you’re earning three times the revenue for every dollar spent on customer acquisition. A low ratio suggests you’re either overspending to acquire customers or not retaining them long enough.
Owner Involvement: The Less You’re Needed, The More It’s Worth: The less the business relies on the owner, the better. A company that runs smoothly without you is more valuable to buyers. Investors prefer businesses with established teams and processes that won’t require replacing a hands-on founder.

Source: FE International for businesses valued over $2M

A Free SaaS Valuation Calculator

Use the free SaaS calculator below to understand how each of the metrics impact your valuation.

Valuing a SaaS business isn’t an exact science. It involves a variety of factors and subjective assessments. While our calculator provides a helpful estimate, it should be used as a guide rather than a definitive valuation. For a more precise evaluation, consider consulting with a professional who understands the nuances of your specific market and business model.

How Churnkey Can Help Increase The Valuation of Your SaaS?

We built Churnkey to solve churn at our own companies. Our retention automation platform is built for high-volume subscription businesses that want to tackle churn head-on.

From precision retries to A/B-tested cancel flows, Churnkey helps you keep more customers, recover lost revenue, and improve the health of your SaaS business.

To get started, sign up for Churnkey or book a demo.