Your Portfolio Companies’
Software Is Amazing –
So Why Are Customers Canceling?
As an investor, you know how frustrating it is to find a software company with great technology and good product/market fit, only to discover high churn rates and related costs to serve are undermining their growth.
If this is a problem for your companies, better user training and support can help. Ask yourself the following questions…
Does the software present a significant learning curve?
Ideally, software is so intuitive that it requires zero training, but this is seldom true for complex business applications.
An industry survey found that 13% of cancellations were due primarily to a product’s learning curve or lack of training. Another found 95% of failed enterprise implementations were due in part to under-investment in training.
Are they losing their champions?
In every customer organization, there are power users who embrace your software and champion its use. But what happens if they leave?
According to SaaStr, the departure of a product champion is the #1 retention risk for software companies. Yet most companies view onboarding as “one and done” and only provide additional training if customers ask. This leaves them vulnerable to cancellation as staff turn over.
Are they developing features that customers don’t use?
Many startup and growth stage companies are fixated on feature development, yet a study by Pendo found companies spend $29.5 billion per year on features that go unused. A Standish Group report found 50% of features are underutilized while 20% are never used.
While this can happen for multiple reasons, lack of training and customer education play a big role. The Technology Services Industry Association (TSIA) found trained customers are 56% more likely to use key product features.
Are implementation and support obligations a barrier to scale?
While most startup and growth stage companies pride themselves on “running lean,” most are too understaffed to effectively service a growing user base.
This is an area where training and support can help: a TSIA report found trained users are 87% more likely to work independently without hands-on support, while 67% of users prefer self-service support, if available.
We get it: training and support aren’t the biggest priorities for investor review. But they are the capacities most lacking in early and growth stage companies.
This is where we come in. Sonata Learning offers turnkey solutions to help software companies develop effective user training and support resources quickly, while building in-house capacity long-term. We work with a range of companies including telemedicine, telecommunications, business process automation, and more. We help clients drive adoption and reduce churn by creating instructor-led onboarding workshops, on-demand videos, customer education webinars, and in-product help.