Board-Ready Metrics

AARRR (Acquisition, Activation, Retention, Referral, Revenue), aka the Pirate Funnel: Dave McClure's five-stage model that pins one measurable metric to each stage of growth.

The yearly value of all active subscriptions in ARR (Annual Recurring Revenue), counted as if every customer keeps paying at today's rate for the next twelve months.

The first moment a new user crosses from "signed up" to "got real value," usually pinned to a specific in-product action taken inside a fixed time window.

How much cash you burn for every dollar of new ARR you add, where under 1 is efficient and over 2 means growth is costing way too much.

How fast you are losing cash each month, usually quoted as gross burn (every dollar out) or net burn (out minus revenue in).

Everything you spend to land one new paying customer in CAC (Customer Acquisition Cost), fully loaded across ad budget, sales team comp, and the tools they run on.

The share of customers or revenue that walks out the door in a given period, tracked as logo churn (count of customers gone) or revenue churn (dollars gone).

A way of grouping customers by something they share (usually signup month) and watching how that group behaves over time, so you can tell real product improvement apart from a shifting mix of users.

The share of people who completed a specific action (clicking, signing up, paying) out of everyone who had the chance to do it.

Whether your current growth rate gets you to profitability before the bank account hits zero, a sharper question than runway because it folds in whether you are actually catching up.

A staged map of the user journey, wide at the top (everyone who could hear about you) and narrow at the bottom (the few who actually act), used to spot where users drop off.

How much of last year's revenue from the same customers is still on the books this year in GDR (Gross Dollar Retention), counting losses but ignoring upsell, so it can never go above 100%.

Every dollar of cash going out the door each month (payroll, software, rent, all of it) before any revenue is netted against it, so you see the raw size of the engine.

The share of each revenue dollar left after you pay the direct costs of delivering it (hosting, payment processing, customer support), reported as a percentage.

The motion where prospects find you on their own, pulled in by content, SEO, community, word of mouth, or product reputation, rather than by you reaching out first.

How many new users each existing user pulls in through invites or shares, calculated as invites sent per user times the conversion rate on those invites.

The total gross-margin dollars a customer is expected to leave behind across their entire relationship with you in LTV (Lifetime Value), shrinking as churn rises and stretching out as they stick around.

How much gross margin a customer eventually pays back compared to what they cost to acquire, where investors want at least 3:1 to believe the business model actually works.

The motion where you sell a small initial contract to one team inside a company, then grow the account over time by adding seats, products, and adjacent departments.

The predictable subscription revenue your customers owe you this month in MRR (Monthly Recurring Revenue), with one-time fees and usage spikes stripped out so the number actually repeats.

How much new annual recurring revenue you get back for every dollar of sales and marketing you spent the quarter before, where above 0.75 is a green light to hire more reps.

The year-over-year change in spend from your existing customer base in NDR (Net Dollar Retention), with upsell and expansion adding to it and churn and downgrades pulling it down, but no credit for new logos.

NPS (Net Promoter Score): a customer-loyalty number from minus 100 to plus 100, calculated by subtracting the share of detractors (0 to 6 on a 0-10 scale) from the share of promoters (9 or 10).

The twelve-month change in revenue from an existing customer cohort in NRR (Net Revenue Retention), counting upsell, downgrade, and churn but no new logos, and used almost interchangeably with NDR (Net Dollar Retention).

The cash you actually lose each month after revenue covers part of the spend, and the number that decides your runway when you divide it into the bank balance.

The motion where the seller reaches out first to people who never asked, usually through cold email, cold calls, or LinkedIn DMs run by sales development reps.

PLG (Product-Led Growth): the motion where the product itself drives signup, activation, and expansion, with users self-onboarding into a free or trial tier before any sales conversation.

How many months a new customer's gross-margin revenue takes to repay what you spent to acquire them, where efficient SaaS businesses usually clear it in under 18.

How many dollars of new and expansion MRR you add for every dollar you lose to churn and downgrades, where above 4 means real growth and below 1 means a leaky bucket.

The act of pulling back users who churned (usually defined as inactive for 28+ days) so they re-engage, often tracked as its own cohort alongside new and active users.

The share of users from a given cohort who keep using the product after a set window, usually checked at day 1, day 7, day 30, and beyond.

The gap between revenue you earned this period under accounting rules and cash you actually invoiced, which can stretch to 12x when a customer prepays a full year up front.

A single-number health check that adds your growth rate to your profit margin, where anything above 40% lets a fast-growing money-loser and a slow-growing cash machine pass the same bar.

How many months you have left at the current pace before the bank account hits zero, assuming today's spend and revenue stay flat.

SAM (Serviceable Addressable Market): the chunk of TAM your product, languages, distribution channels, and pricing can realistically serve right now.

SLG (Sales-Led Growth): the motion where a human sales team drives the buy through outbound prospecting, demos, multi-stakeholder evaluations, and negotiated contracts.

SOM (Serviceable Obtainable Market): the slice of SAM you can actually win in the next three to five years given your team, capital, and competition.

TAM (Total Addressable Market): the full annual revenue a product would earn if every possible buyer on Earth used it at the price you charge.

The formal name for K-factor: the average number of new users each user pulls in by inviting others, where anything above 1 produces self-sustaining exponential growth.