Burn Rate
Burn rate is the monthly rate at which a startup spends cash. It determines how much runway remains before the company must raise more money or turn profitable.
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Burn rate is the monthly rate at which a startup spends cash. It determines how much runway remains before the company must raise more money or turn profitable.
CAC is the total cost to acquire a new customer, including all sales and marketing spend. A core unit economics metric for evaluating business viability.
The % of new users who reach your product's core value moment within a defined window. The most predictive early-stage metric for long-term retention.
Churn rate is the percentage of customers or revenue a business loses over a given period. The most important retention metric for any subscription business.
ARR is the annualized value of all active subscriptions. It is the primary top-line metric for SaaS companies and a key signal for fundraising readiness.
A method of grouping users by a shared trait—typically signup date—and tracking their behavior over time to reveal retention trends.
A startup is default alive if its revenue growth will reach profitability before cash runs out. Coined by Paul Graham in 2015.
Revenue minus Cost of Goods Sold, divided by revenue. The foundational profitability metric that drives SaaS valuation multiples and unit economics.
LTV is the total revenue a business expects from a customer over their lifetime. The key metric for justifying acquisition spend and evaluating unit economics.
MRR is the total recurring subscription revenue a SaaS company earns each month. It is the operational heartbeat metric for tracking short-term growth.
The North Star Metric is the single number that best captures the core value a product delivers to customers and predicts long-term sustainable growth.
NRR measures how much recurring revenue is retained and grown from existing customers. Above 100% means the company grows revenue without any new customers.
Months to recover the cost of acquiring a customer from that customer's gross profit contribution. Best-in-class SaaS is under 12 months.
Growth rate % plus EBITDA margin % must equal or exceed 40. The single metric VCs use to balance SaaS growth against profitability efficiency.
Runway is how many months a startup can operate before running out of cash. It defines the time to reach the next milestone or close the next funding round.
The direct revenues and costs associated with a single unit of a business, used to determine per-unit profitability and scalability.
Also called K-factor: the average number of new users each existing user generates. K above 1 means exponential viral growth; below 1 is partial amplification.
Learn how to design, prioritize, and run growth experiments at your startup using the ICE framework, experiment logs, and disciplined test design.
Set up a three-layer analytics stack for your startup — product, revenue, and marketing analytics — and avoid the data traps that waste founder time.
Eric Ries' framework for measuring startup progress using leading indicators when traditional revenue metrics are too early to be meaningful.
OKRs (Objectives and Key Results) are a goal-setting framework that aligns teams around ambitious, measurable outcomes on a quarterly or annual cycle.
The AARRR framework breaks startup growth into five measurable stages: Acquisition, Activation, Retention, Revenue, and Referral.
Most founders track vanity metrics. Here are the 10 SaaS metrics that actually predict growth, retention, and unit economics — with benchmarks.