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   and here's what drives it. Plus, a roundup of this week’s best SaaS thinking.  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­
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                        Edition #516, 08-May-2026
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                       <p style="margin:0;margin-bottom:16px">
                        SaaSMag asked me recently what separates companies with world-class retention from the rest.
                        <br/>
                        <br/>
                        A big part of it is structural. Some products are just more essential than others. Subscription billing is a category companies don't want to switch away from. Video editing is more project-based. That creates a natural range in retention across SaaS.
                        <br/>
                        <br/>
                        But AI is shifting what "essential" means. The bar for value is moving from tools to outcomes. If your product can actually do the work, not just support it, retention gets stronger.
                        <br/>
                        <br/>
                        The question every founder needs to answer honestly: are you benefiting from that shift, or being disrupted by it?
                        <br/>
                        <br/>
                        The fundamentals of retention haven't changed. What's changed is how much faster the gap widens between the companies that get it right and the ones that don't yet.
                        <br/>
                        <br/>
                        Read the full interview
                        <a class="" rel="noopener" style="text-decoration: underline; color: #666e89;" target="_blank">
                         here
                        </a>
                        .
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                        <a class="" rel="noopener" style="text-decoration: underline; color: #666e89;" target="_blank">
                         <strong>
                          Nick Franklin
                         </strong>
                        </a>
                        <br/>
                        Founder &amp; CEO
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                        This week in SaaS
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                       When should you recognize churn?
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                        Tracking churn is crucial, but deciding when to recognize it can be tricky. Think of it as a choice of perspective: a forward-looking view that treats cancellations as immediate losses, a revenue-aligned view that reflects what customers have paid for, or a billing-system view that keeps your metrics in sync with your source of truth.
                       </p>
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                        <em>
                         "Deciding when to classify a customer as “churned” isn’t always straightforward. The right time depends on the nature of your product, billing cycles, and the typical behavior of your customers."
                        </em>
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                        Cursor went from $1M to $100M ARR faster than any software company in history. Learn why they built for their most demanding users before trying to democratize, the metric that predicted success (and why it wasn’t DAUs or signups), and how they grew to over a million daily users without spending a dollar on traditional marketing.
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                        When vendors define their own audit controls, a clean SOC 2 tells you less than you think. The real insight is what's missing, and five specific areas reveal more about security posture than the report itself. A zero-exception log is a red flag, not a green one. Learn how to use a SOC 2 as a structured conversation opener the next time you're evaluating a vendor.
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