SaaS businesses live and die by a small set of numbers. You don't need a BI team to track them. A spreadsheet and the formulas below are enough for your first few years. Here are the ten that matter most, roughly in the order you'll need them.

1. Monthly recurring revenue (MRR)

The normalized monthly value of all active subscriptions. Annual plans count as one twelfth per month. It's the single best measure of your business's current size. → MRR calculator

2. MRR growth rate

Month-over-month percentage change in MRR. Track net new MRR too, broken into new, expansion, contraction, and churned MRR, so you know why growth changed. → MRR growth calculator

3. Customer churn rate

Customers lost during a month ÷ customers at the start of the month. The best early warning sign that something is wrong with your product or your customer fit. → Churn rate calculator

4. Net revenue retention (NRR)

How much revenue from an existing group of customers grows or shrinks over time, counting upgrades, downgrades, and cancellations. Above 100% means your current customers grow your revenue even with no new sales. Many investors treat it as the best single indicator of a SaaS company's quality.

5. Average revenue per account (ARPA / ARPU)

MRR ÷ paying customers. Tells you whether you're moving upmarket or downmarket, and it drives most other unit economics.

6. Customer acquisition cost (CAC)

Total sales and marketing spend in a period ÷ new customers in that period. Include salaries and tools, not just ad spend. Blended CAC includes free channels. Paid CAC looks at paid channels alone.

7. Customer lifetime value (LTV)

(ARPA × gross margin) ÷ monthly churn. How much gross profit a typical customer produces over their life. → LTV calculator

8. LTV:CAC and CAC payback

The ratio of lifetime value to acquisition cost (aim for about 3:1), and the months it takes to earn back CAC (aim for under 12). Together they tell you whether pouring money into growth creates value or destroys it.

9. Activation rate

The percentage of new signups who reach your product's "aha moment", the first meaningful result. For a scheduling tool, that might be booking a first meeting. Activation is the earliest predictor of retention, and onboarding work pays off here first.

10. Burn rate and runway

Net burn = monthly expenses − monthly revenue. Runway = cash ÷ net burn. If you aren't profitable, this is the deadline for everything else. → Runway calculator

Which metrics matter at your stage?

Stage Focus on
Pre-revenue Activation, retention of free users, qualitative feedback
$0–$10K MRR MRR, growth rate, customer churn, runway
$10K–$100K MRR NRR, CAC by channel, payback, ARPA
$100K MRR+ Cohort retention, LTV:CAC, sales efficiency, gross margin

Early on, too many metrics is a distraction. Pick three, update them every month, and write one sentence about why each moved.

Cohort analysis: the next step

Averages hide trends. A cohort table groups customers by the month they signed up and tracks what percentage remain each month after. If newer cohorts retain better than older ones, your product is improving. Stripe, Paddle, ChartMogul, Baremetrics, and ProfitWell can all produce cohort charts from your billing data.

Sharing your metrics

Many founders share some of these numbers publicly as part of building in public. You don't have to share everything. Growth rate and customer count are often enough. When you do share, a clean milestone card makes the number easy to read. For quick definitions of any term, see the SaaS glossary.