Intermediate metrics
CAC — Customer Acquisition Cost
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.
#unit economics
5 results
Glossary
Beginner metrics
Churn Rate
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.
Beginner finance
Gross Margin
Revenue minus Cost of Goods Sold, divided by revenue. The foundational profitability metric that drives SaaS valuation multiples and unit economics.
Intermediate metrics
LTV — Lifetime Value
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.
Intermediate finance
Payback Period
Months to recover the cost of acquiring a customer from that customer's gross profit contribution. Best-in-class SaaS is under 12 months.