SaaS Metrics – Page 4

Growth in Valuation Since the Previous Raise is the percentage increase in a company's valuation from one funding round to the next. It shows how much value the company created between raises.

Hype Factor is an efficiency metric that shows how efficiently a company converts capital raised into ARR. SaaS companies convert venture capital into two things: annual recurring revenue (ARR) and hype. ARR has direct value as every year it turns into GAAP revenue. Hype has value to the extent it creates halo effects that drive interest in the company that ultimately increase ARR.

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.

Logo Churn (also called Customer Churn or Account Churn) measures the number or percentage of customers who cancel their subscription or stop doing business with a company during a specific time period, regardless of the revenue value of those customers. Unlike revenue-based churn metrics, Logo Churn treats all customer losses equally, making it a critical indicator of product-market fit, customer satisfaction, and business model sustainability.

Monthly Active Accounts is the count of unique accounts with at least one active user in a given month. It measures platform engagement at the account level, tracking how many accounts are actively using an application or service each month.

Monthly Active Users (MAU) is the count of unique users who interact with an application or platform at least once in a given month. MAU tracks engagement across both new and returning users, and serves as an early indicator of retention risk or growth momentum. Unique users are identified by username, email address, or user ID. Both paying and non-paying users count, including those on free trials.

Monthly Recurring Revenue (MRR) is a key performance indicator (KPI) that represents the total predictable, recurring revenue a subscription-based business expects to generate every month from its active customers. It is calculated by normalizing all subscription income—regardless of the billing cycle (monthly, quarterly, or annual)—into a consistent monthly figure. MRR is a vital metric for Software-as-a-Service (SaaS) and other subscription models, providing an immediate and granular view of financial health, growth trajectory, and stability. Critically, MRR excludes all non-recurring revenue, such as one-time setup fees, consulting charges, or hardware sales, focusing solely on the reliable, repeatable income stream.

Monthly Recurring Revenue (MRR) Growth Rate is the velocity at which MRR is being added to the business, expressed as a percentage. MRR Growth Rate is often cited as a monthly rate, but it's also possible to express it using an annual timeframe; for example, "we are targeting 10% MRR Growth for April", or "our MRR Growth Rate was 100% last year".

Natural Rate of Growth measures the speed at which your company grows, purely based on organic sources of growth. This includes organic signups and incremental recurring revenue started in product without sales involvement.

Net Annual Recurring Revenue (ARR) Added measures the net change in ARR during a period by combining all sources of ARR growth (new customers and expansion) and all sources of ARR contraction (churn and downgrades). This metric provides a comprehensive view of revenue momentum and reveals which business functions are driving growth or creating drag.

Net Burn, often referred to as Burn Rate, is the amount a company is losing per month as they burn through their cash reserves. It occurs when a company’s operating costs are higher than their revenue. A company that is profitable and generating cash has a "negative Net Burn".

Net Monthly Recurring Revenue (MRR) Churn Rate is the percentage change in MRR from existing customers due to expansions, cancellations, and downgrades. A negative Net MRR Churn Rate occurs when expansions exceed downgrades and cancellations and is a strong positive indicator of company health. This metric is typically expressed as a monthly rate, although it can also be calculated as an annual rate: Net Annual Recurring Revenue (ARR) Churn Rate.