Finding customers and growing
SaaS (software as a service)
SaaS, short for software as a service, is software people use online and pay for with a recurring subscription instead of buying it once.
Also called software as a service, B2B SaaS
Looking this up for a class, a job, or something you want to build? If it is the last one, nommi reads your idea before you spend months on it.
The customer does not install or maintain anything. They log in, and you run the software for them. Because payment repeats, a SaaS business lives on keeping customers, not only winning them. That is why founders who build SaaS watch how many customers stay each month as closely as how many sign up.
What recent High Alpha data says
In High Alpha's 2025 survey, the median SaaS company with 1 million to 5 million US dollars of ARR (yearly recurring revenue) kept 104% of last year's revenue from existing customers, upgrades included.
- Median net revenue retention, under 1 million and 1 million to 5 million US dollars of ARR: 100% and 104%.
- Median software gross margin (the share of revenue left after the direct cost of running the software), same two groups: 74% and 77%.
Source: High Alpha, 2025 SaaS Benchmarks Report. More than 800 SaaS companies surveyed, 69% in the US, not all startups. As of 5 November 2026.
When this shows up
Example, not a real founder: you build a scheduling tool for hair salons and plan to charge a monthly fee. Calling it SaaS is accurate. The question that matters is whether salons keep paying after the second month, once the novelty wears off.
What to do next
Before choosing a price, ask three people who would buy it how they pay for similar tools today, and how often.
Go deeper
How much should you charge for your app? A number with reasons
A suggested price, how sure it is, where your pricing leaks money and one test, or a note when it cannot price honestly.
Read the guideOr go straight to the tool