Which SaaS Metrics Should I Track?

There are dozens of SaaS metrics, and the right handful depends on your company. Describe it in a sentence or two and get the metrics that matter most right now, why they matter for you, and how to calculate each one correctly.

Include your funding stage, how customers buy, who you sell to, and your main goal. At least 20 characters.

Educational output based on your inputs; not professional or fundraising advice.

We don't store your description. It is sent to TypeSafe AI to classify your company; see our Privacy Policy.

How it works

An automated model (TypeSafe AI) reads your description and classifies five things: funding stage, how customers buy, who you sell to, your main goal, and how you charge. When it isn't sure, it asks you instead of guessing. It does not write the recommendations: those come from a fixed playbook of weights and explanations based on 4NLab's experience, so the same profile always gets the same list. The result is educational, not fundraising or financial advice. See the Terms of Use and Disclaimer.

Two example profiles

What the advisor recommends for two typical companies. These lists come straight from the playbook, so the tool gives the same result for the same profile.

Bootstrapped subscription business

Self-funded project-management app; small agencies sign up online and pay monthly; the goal is to stop losing customers.

  • Bootstrapped
  • Self-serve
  • Small businesses
  • Reducing churn
  • Subscription
  1. Customer churn: You want to reduce churn, and this shows where customers or revenue are leaking.
  2. ARPA: Small-business customers tend to churn more often, so retention needs close attention.
  3. MRR: Without outside funding, the business has to pay for its own growth.
  4. Free cash flow: Without outside funding, the business has to pay for its own growth.
  5. CAC payback: Without outside funding, the business has to pay for its own growth.
  6. GRR: You want to reduce churn, and this shows where customers or revenue are leaking.

Seed-stage, sales-led company

HR software sold by a small sales team to mid-sized companies; raising a seed round in six months.

  • Seed
  • Sales-led
  • Mid-market
  • Raising the next round
  • Subscription
  1. CAC payback: With a sales team closing deals, the cost and speed of each sale drive your economics.
  2. NRR: You're raising, and investors will ask for this.
  3. MRR: You're raising, and investors will ask for this.
  4. Runway: You're raising, and investors will ask for this.
  5. Burn multiple: You're raising, and investors will ask for this.
  6. Customer churn: At seed, you're showing that early traction can become repeatable growth.

Your first month of metrics: a checklist

  1. At the start of the month, record paying customers and MRR. Leave out trials and free accounts.
  2. Convert every plan to a monthly amount: divide annual plans by 12, and leave setup fees and one-off services out.
  3. At month end, count cancellations among the starting customers for customer churn. Report customers who came back separately; don't net them against churn.
  4. Split the change in MRR into new, expansion, contraction, churn and reactivation, which gives you GRR and NRR for the starting customers.
  5. Record sales and marketing spend, including sales salaries, and new paying customers for CAC.
  6. Note your cash balance and net burn to track runway.

Where to start at each stage

Before sales motion, customers and goal are taken into account, these are the playbook's starting points:

Bootstrapped

  • Customer churn: Customer churn is the share of starting customers you lose each period, usually the earliest sign of a retention problem.
  • MRR: MRR is your recurring revenue each month; its month-over-month change is the clearest signal of growth.
  • Free cash flow: Free cash flow is the cash your business actually generates after operating costs and capital spending.
  • CAC payback: CAC payback is how many months of gross profit it takes to earn back what you spent to win a customer.
  • Gross margin: Gross margin is how much of each revenue dollar is left after the cost of delivering your product.
  • ARPA: ARPA is average monthly revenue per account; it shows whether growth comes from more customers or bigger ones.

Pre-seed

  • Customer churn: Customer churn is the share of starting customers you lose each period, usually the earliest sign of a retention problem.
  • Runway: Runway is how many months your cash lasts at your current net burn.
  • Product-market fit: Product-market fit signals show whether a specific group of customers truly needs what you've built.
  • MRR: MRR is your recurring revenue each month; its month-over-month change is the clearest signal of growth.

Seed

  • Customer churn: Customer churn is the share of starting customers you lose each period, usually the earliest sign of a retention problem.
  • MRR: MRR is your recurring revenue each month; its month-over-month change is the clearest signal of growth.
  • Runway: Runway is how many months your cash lasts at your current net burn.
  • NRR: NRR shows whether revenue from existing customers grows or shrinks once upgrades, downgrades and cancellations are counted.
  • Burn multiple: Burn multiple is how much cash you burn for each dollar of net new ARR.
  • CAC payback: CAC payback is how many months of gross profit it takes to earn back what you spent to win a customer.
  • CAC: CAC is how much you spend on sales and marketing to win one new customer.

Series A

  • NRR: NRR shows whether revenue from existing customers grows or shrinks once upgrades, downgrades and cancellations are counted.
  • ARR: ARR is your recurring revenue run-rate for a year, the number investors use to size and compare SaaS companies.
  • Burn multiple: Burn multiple is how much cash you burn for each dollar of net new ARR.
  • CAC payback: CAC payback is how many months of gross profit it takes to earn back what you spent to win a customer.
  • Runway: Runway is how many months your cash lasts at your current net burn.
  • GRR: GRR is the share of starting recurring revenue you keep before counting any expansion: the floor under your revenue base.
  • Gross margin: Gross margin is how much of each revenue dollar is left after the cost of delivering your product.
  • LTV:CAC: LTV:CAC compares what a customer is worth with what it cost to win them.
  • Magic number: The magic number shows how much new revenue each dollar of last quarter's sales and marketing spend produced.

Series B or later

  • NRR: NRR shows whether revenue from existing customers grows or shrinks once upgrades, downgrades and cancellations are counted.
  • ARR: ARR is your recurring revenue run-rate for a year, the number investors use to size and compare SaaS companies.
  • GRR: GRR is the share of starting recurring revenue you keep before counting any expansion: the floor under your revenue base.
  • Rule of 40: The Rule of 40 adds your growth rate and profit margin to show how well you balance growth and efficiency.
  • Burn multiple: Burn multiple is how much cash you burn for each dollar of net new ARR.
  • CAC payback: CAC payback is how many months of gross profit it takes to earn back what you spent to win a customer.
  • Gross margin: Gross margin is how much of each revenue dollar is left after the cost of delivering your product.
  • Magic number: The magic number shows how much new revenue each dollar of last quarter's sales and marketing spend produced.
  • Free cash flow: Free cash flow is the cash your business actually generates after operating costs and capital spending.