In my previous article, The Hidden Cost of Churn to Enterprise Value, I revealed the millions of dollars lost to churn every year. In this article, I share how you can calculate the cost of churn to your Enterprise Value.
Everytime a customer churns, your organization takes a hit to its Enterprise Value. You'll have to replace the losses with newly acquired customers at a significantly higher cost, not only in marketing and acquisition efforts, but also by having to overcome the damages made to your company's reputation as well.
Calculating the cost of churn to Enterprise Value is straightforward yet powerful:
Gross ARR Churn Amount x Enterprise Valuation Multiple
Are you ready to calculate the cost of churn to your Enterprise Value? Check out this FREE Cost of Calculator to find out exactly how much Enterprise Value (EV) you lost to churn in the last year. I'll wager it's a number big enough to care about!
Infographic: How Churn Takes a BITE Out of You!