Top 5 Growth Metrics for SMBs Metrics
The five metrics that matter most for tracking small and mid-sized business growth. Each includes a definition, formula, and guidance on what good looks like — so you can measure expansion without enterprise-level complexity.
Default directory · A–Z · 5 metrics
Activation Rate
Activation Rate helps companies determine how quickly and effectively their new users are achieving perceived value. It measures the number of new users that have performed a predetermined “key action” within a set period of time, where the key action is assumed or known to deliver initial customer value.
CAC Payback Period
CAC Payback Period is the number of months a company needs to recover its customer acquisition costs through revenue generated by new customers. It combines Customer Acquisition Cost (CAC), Net New MRR, and Gross Margin percentage to measure go-to-market efficiency. The shorter the payback period, the faster a company recycles growth capital.
Gross Revenue Retention Rate
Gross Revenue Retention (GRR) Rate is the percentage of recurring revenue retained from existing customers in a defined time period, including downgrades, and cancels. It does not include any expansion revenue. GRR is also commonly referred to as Gross Renewal Rate.
Lifetime Value to Cost of Acquisition Ratio
The LTV/CAC ratio measures the lifetime revenue a customer generates relative to the cost of acquiring that customer. A ratio of 3 or higher is the standard benchmark for sustainable SaaS growth.
Net Revenue Retention Rate
Net Revenue Retention (NRR) Rate, also known as Net Dollar Retention (NDR), is the percentage of recurring revenue retained from existing customers in a defined time period, including expansion revenue, downgrades, and cancels. This churn metric gives a comprehensive view of positive as well as negative changes with respect to customer retention.