Illustrative case study · Private Equity
Most leavers go in year one, with templates half built.
A contract lifecycle platform’s value to a private equity investor rested on renewals, and on a price rise at each one. The investor needed to know whether that retention is built in. We spoke with 220 current customers, former customers and peer users, and the report was done in 14 days.
Illustrative example. The company, scenario, and all figures are fictional. They show UserCue’s method and deliverable format. They do not come from any client study.
The engagement
Illustrative scenariodays, with the report, the data file and a live readout.
Legal operations and contract managers on the platform and its peers.
90 current customers, 60 former customers and 70 peer users.
Exits dated from go-live, a peer scorecard and five price rises in turn.
A private equity investor
Whether the platform’s retention can carry the value creation plan
Customer VoC, during diligence
AI-moderated interviews with a peer scorecard and a price ladder
Loyalty, exit timing and reasons, switching cost, price tolerance
Legal and contract teams at mid-size and large companies in the US
Headline figures
of former customers left inside their first year on the platform
net promoter score among current customers, against +4 for peer users’ own tools
of current customers would renew without shopping around after a 7% rise
The question
Is this platform’s retention built in, or is every renewal a risk?
Current customers could say what holds them, former customers when and why they left, and users of Peers A to C how the platform compares. The deal team needed all three, from the people who own the contract tool, before backing a price increase at renewal.
How does the platform’s experience compare with Peers A to C?
What holds customers in, and why did former customers leave?
How big a price rise would current customers accept?
What we did
How the study ran, start to finish.
- 1Kickoff
Built-in retention, or renewal risk.
Is this platform’s retention built in, or is every renewal a risk? The kickoff turned it into three questions: how it compares with Peers A to C, what holds customers in and why former customers left, and how big a rise customers would accept.
- 2Design
Three groups, exits dated from go-live.
The screener admitted only the tool’s owner or signer: 90 customers, 60 former customers, 70 on Peers A to C. Customers and peer users scored NPS and six criteria; former customers gave the month they left after go-live, and customers met a five-step price ladder.
- 3Fielding
Leavers pressed on what they pay now.
Each voice or text conversation held quant and qual, ran a median 29 minutes and pressed every former customer on what their new tool costs. The researcher read all 253 and removed 33 for duplicate identities, contradictions or no hands-on use, leaving 220.
- 4Analysis
Churn clusters in the first year.
The researcher set each former customer’s exit against how long they had used the tool: churn clustered before their templates and clause library were built. 70% of former customers left inside their first year, and 47% of all exits traced to implementation and support.
- 5Readout
First-year exits are 70% of churn.
The researcher walked the operating partner and deal team through a 34-page report at a live readout: peer scorecard, first-year churn and the price ladder. Funding went to an onboarding team that builds each new customer’s clause library in its first quarter.
What we found
Four findings from the report.
Customers rate the platform above its peers, with a net promoter score of +18 against +4. Churn comes early: 70% of former customers left inside their first year, before their templates and clause library were built. 68% of current customers say switching would be hard, and 62% would renew through a 7% rise.
Customers rate the platform above its peers, except on implementation.
Current customers give the platform a net promoter score of +18, and peer users give their own tools +4. The platform leads on contract search and trails on implementation and support, where 36% of its customers rate it good or excellent, against 59% of peer users.
Most customers who leave go in their first year.
70% of former customers left inside their first year, 43% within six months of go-live. Implementation and support drove 47% of all exits and missing integrations 27%. 53% pay the same or more with their new vendor.
Former customers, time from go-live to exit · n = 60Once the clause library is built, switching looks hard.
68% of current customers say switching would be hard, and 79% of those 61 name the templates and clause library they have built. Approval workflows and contract history follow.
Current customers who say switching would be hard · multi-select · n = 61Most renew through a 7% rise; at 9%, most shop around.
At a 7% rise, 62% of current customers would renew without shopping around. At 9% that falls to 36%, and at 12% to 17%. 59% call today’s price fair for what the platform does.
Would renew without shopping around, by size of rise · n = 90“The first six months decide it. If the templates are still half built by then, people go back to email and the tool never recovers.”Legal operations manager · Illustrative quote
Illustrative quotes
Three themes behind the numbers.
“We signed in the spring and left before the next one. The implementation team changed twice, and our clause library was half done when we gave up.”
“Four hundred templates live in that system now. Nobody in legal wants to rebuild them, whatever the renewal quote says.”
“The CFO signs off on a small bump without a meeting. Much past that and my own team ends up redlining our vendor’s renewal, which is the last thing legal has time for.”
What the investor did
Three moves made with the report.
Made the clause library part of onboarding.
A dedicated team builds each new customer’s templates and clause library in its first quarter, ahead of the year when 70% of leavers go.
Held the 7% rise for the second renewal.
The rise skips first renewals, where most leavers go, and starts at the second, with 62% of current customers ready to renew through 7%.
Funded the integrations that leavers missed.
Missing integrations drove 27% of exits, so the two connectors leavers named most now ship with every new implementation.
Illustrative example. The company, scenario, and all figures are fictional. They show UserCue’s method and deliverable format. They do not come from any client study.
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