Starting churn vs. Sustaining churn

There's a difference between what we call "starting churn" (the number of people you lose in the first few months of their paying you) and "sustaining churn" (the number of people you lose further down into the customer lifecycle).

Net churn metrics tend to over index on sustaining churn and ignore starting churn. This is a huge problem because if you're looking at net churn in isolation you're not even noticing the large number of people you're losing in the early stages of the customer journey.

This really puts into perspective whyΒ net churn is not the greatest financial predictor. And why it especially doesn't give your company a lot of control over being able to leverage it. If you're tracking the number of people you're losingΒ as a wholeΒ from one month to the next to the next, that includes people who just signed up and people who have been with you for nine years.From: VPP Episode 2 (42.51)