Finance Metrics Quickref by @deanpeters

Purpose

Quick reference for any SaaS finance metric without deep teaching. Use this when you need a fast formula lookup, benchmark check, or decision framework reminder. For detailed explanations, calculations, and examples, see the related deep-dive skills.

This is not a teaching tool—it's a cheat sheet optimized for speed. Scan, find, apply.

Input

Works best with: The metric you need — name it and get the formula, benchmark, and decision context. Also useful: Your numbers, if you want the formula applied on the spot.

Anything supplied with the invocation itself — text after the skill name, a pasted context dump, or an appended ARGUMENTS: line — counts as answers already given. Use it and skip whatever it covers; don't re-ask.

Arriving empty-handed? That works too. Ask for the metric family you're working in (revenue, retention, efficiency, capital) and scan from there.

Example invocation: Quick ref: burn multiple — formula, benchmark, and whether 1.7 is bad for Series B.

Key Concepts

Metric Categories

Metrics are organized into four families:

Revenue & Growth — Top-line money (revenue, ARPU, ARPA, MRR/ARR, churn, NRR, expansion)
Unit Economics — Customer-level profitability (CAC, LTV, payback, margins)
Capital Efficiency — Cash management (burn rate, runway, OpEx, net income)

Metric	Formula	What It Measures	Good Benchmark	Red Flag
Revenue	Total sales before expenses	Top-line money earned	Growth rate >20% YoY (varies by stage)	Revenue growing slower than costs
ARPU	Total Revenue / Total Users	Revenue per individual user	Varies by model; track trend	ARPU declining cohort-over-cohort
ARPA	MRR / Active Accounts	Revenue per customer account	SMB: $100-$1K; Mid: $1K-$10K; Ent: $10K+	High ARPA + low ARPU (undermonetized seats)
ACV	Annual Recurring Revenue per Contract	Annualized contract value	SMB: $5K-$25K; Mid: $25K-$100K; Ent: $100K+	ACV declining (moving downmarket unintentionally)
MRR/ARR	MRR × 12 = ARR	Predictable recurring revenue	Growth + quality matter; track components	New MRR declining while churn stable/growing
Churn Rate	Customers Lost / Starting Customers	% of customers who cancel	Monthly <2% great, <5% ok; Annual <10% great	Churn increasing cohort-over-cohort
NRR	(Start ARR + Expansion - Churn - Contraction) / Start ARR × 100	Revenue retention + expansion	>120% excellent; 100-120% good; 90-100% ok	NRR <100% (base is contracting)
Expansion Revenue	Upsells + Cross-sells + Usage Growth	Additional revenue from existing customers	20-30% of total revenue	Expansion <10% of MRR
Quick Ratio	(New MRR + Expansion MRR) / (Churned MRR + Contraction)	Revenue gains vs. losses	>4 excellent; 2-4 healthy; <2 leaky bucket	Quick Ratio <2 (leaky bucket)
Gross Margin	(Revenue - COGS) / Revenue × 100	% of revenue after direct costs	SaaS: 70-85% good; <60% concerning	Gross margin <60% or declining
CAC	Total S&M Spend / New Customers	Cost to acquire one customer	Varies: Ent $10K+ ok; SMB <$500	CAC increasing while LTV flat
LTV	ARPU × Gross Margin % / Churn Rate	Total revenue from one customer	Must be 3x+ CAC; varies by segment	LTV declining cohort-over-cohort
LTV:CAC	LTV / CAC	Unit economics efficiency	3:1 healthy; <1:1 unsustainable; >5:1 underinvesting	LTV:CAC <1.5:1
Payback Period	CAC / (Monthly ARPU × Gross Margin %)	Months to recover CAC	<12 months great; 12-18 ok; >24 concerning	Payback >24 months (cash trap)
Contribution Margin	(Revenue - All Variable Costs) / Revenue × 100	True contribution after variable costs	60-80% good for SaaS; <40% concerning	Contribution margin <40%
Burn Rate	Monthly Cash Spent - Revenue	Cash consumed per month	Net burn <$200K manageable early; <$500K growth	Net burn accelerating
Runway	Cash Balance / Monthly Net Burn	Months until money runs out	12+ months good; 6-12 ok; <6 crisis	Runway <6 months
OpEx	S&M + R&D + G&A	Costs to run the business	Should grow slower than revenue	OpEx growing faster than revenue
Net Income	Revenue - All Expenses	Actual profit/loss	Early negative ok; mature 10-20%+ margin	Losses accelerating without growth
Rule of 40	Revenue Growth % + Profit Margin %	Balance of growth vs. efficiency	>40 healthy; 25-40 ok; <25 concerning	Rule of 40 <25
Magic Number	(Q Revenue - Prev Q Revenue) × 4 / Prev Q S&M	S&M efficiency	>0.75 efficient; 0.5-0.75 ok; <0.5 fix GTM	Magic Number <0.5
Operating Leverage	Revenue Growth vs. OpEx Growth	Scaling efficiency	Revenue growth > OpEx growth	OpEx growing faster than revenue
Gross vs. Net Revenue	Net = Gross - Discounts - Refunds - Credits	What you actually keep	Refunds <10%; discounts <20%	Refunds >10% (product problem)
Revenue Concentration	Top N Customers / Total Revenue	Dependency on largest customers	Top customer <10%; Top 10 <40%	Top customer >25% (existential risk)
Revenue Mix	Product/Segment Revenue / Total Revenue	Portfolio composition	No single product >60% ideal	Single product >80% (no diversification)
Cohort Analysis	Group customers by join date; track behavior	Whether business improving or degrading	Recent cohorts same/better than old	Newer cohorts perform worse
CAC Payback by Channel	CAC / Monthly Contribution (by channel)	Payback by acquisition channel	Compare across channels	One channel far worse than others
Gross Margin Payback	CAC / (Monthly ARPU × Gross Margin %)	Payback using actual profit	Typically 1.5-2x simple payback	Payback using margin >36 months
Unit Economics	Revenue per unit - Cost per unit	Profitability of each "unit"	Positive contribution required	Negative contribution margin
Segment Payback	CAC / Monthly Contribution (by segment)	Payback by customer segment	Compare to allocate resources	One segment unprofitable
Incrementality	Revenue caused by action - Baseline	True impact of marketing/promo	Measure with holdout tests	Celebrating revenue that would've happened anyway
Working Capital	Cash timing between revenue and collection	Cash vs. revenue timing	Annual upfront > monthly billing	Long payment terms killing runway

Metric

Formula

What It Measures

Good Benchmark

Red Flag

Revenue

Total sales before expenses

Top-line money earned

Growth rate >20% YoY (varies by stage)

Revenue growing slower than costs

ARPU

Total Revenue / Total Users

Revenue per individual user

Varies by model; track trend

ARPU declining cohort-over-cohort

ARPA

MRR / Active Accounts

Revenue per customer account

SMB: $100-$1K; Mid: $1K-$10K; Ent: $10K+

High ARPA + low ARPU (undermonetized seats)

ACV

Annual Recurring Revenue per Contract

Annualized contract value

SMB: $5K-$25K; Mid: $25K-$100K; Ent: $100K+

ACV declining (moving downmarket unintentionally)

MRR/ARR

MRR × 12 = ARR

Predictable recurring revenue

Growth + quality matter; track components

New MRR declining while churn stable/growing

Churn Rate

Customers Lost / Starting Customers

% of customers who cancel

Monthly <2% great, <5% ok; Annual <10% great

Churn increasing cohort-over-cohort

NRR

(Start ARR + Expansion - Churn - Contraction) / Start ARR × 100

Revenue retention + expansion

>120% excellent; 100-120% good; 90-100% ok

NRR <100% (base is contracting)

Expansion Revenue

Upsells + Cross-sells + Usage Growth

Additional revenue from existing customers

20-30% of total revenue

Expansion <10% of MRR

Quick Ratio

(New MRR + Expansion MRR) / (Churned MRR + Contraction)

Revenue gains vs. losses

>4 excellent; 2-4 healthy; <2 leaky bucket

Quick Ratio <2 (leaky bucket)

Gross Margin

(Revenue - COGS) / Revenue × 100

% of revenue after direct costs

SaaS: 70-85% good; <60% concerning

Gross margin <60% or declining

CAC

Total S&M Spend / New Customers

Cost to acquire one customer

Varies: Ent $10K+ ok; SMB <$500

CAC increasing while LTV flat

LTV

ARPU × Gross Margin % / Churn Rate

Total revenue from one customer

Must be 3x+ CAC; varies by segment

LTV declining cohort-over-cohort

LTV:CAC

LTV / CAC

Unit economics efficiency

3:1 healthy; <1:1 unsustainable; >5:1 underinvesting

LTV:CAC <1.5:1

Payback Period

CAC / (Monthly ARPU × Gross Margin %)

Months to recover CAC

<12 months great; 12-18 ok; >24 concerning

Payback >24 months (cash trap)

Contribution Margin

(Revenue - All Variable Costs) / Revenue × 100

True contribution after variable costs

60-80% good for SaaS; <40% concerning

Contribution margin <40%

Burn Rate

Monthly Cash Spent - Revenue

Cash consumed per month

Net burn <$200K manageable early; <$500K growth

Net burn accelerating

Runway

Cash Balance / Monthly Net Burn

Months until money runs out

12+ months good; 6-12 ok; <6 crisis

Runway <6 months

OpEx

S&M + R&D + G&A

Costs to run the business

Should grow slower than revenue

OpEx growing faster than revenue

Net Income

Revenue - All Expenses

Actual profit/loss

Early negative ok; mature 10-20%+ margin

Losses accelerating without growth

Rule of 40

Revenue Growth % + Profit Margin %

Balance of growth vs. efficiency

>40 healthy; 25-40 ok; <25 concerning

Rule of 40 <25

Magic Number

(Q Revenue - Prev Q Revenue) × 4 / Prev Q S&M

S&M efficiency

>0.75 efficient; 0.5-0.75 ok; <0.5 fix GTM

Magic Number <0.5

Operating Leverage

Revenue Growth vs. OpEx Growth

Scaling efficiency

Revenue growth > OpEx growth

OpEx growing faster than revenue

Gross vs. Net Revenue

Net = Gross - Discounts - Refunds - Credits

What you actually keep

Refunds <10%; discounts <20%

Refunds >10% (product problem)

Revenue Concentration

Top N Customers / Total Revenue

Dependency on largest customers

Top customer <10%; Top 10 <40%

Top customer >25% (existential risk)

Revenue Mix

Product/Segment Revenue / Total Revenue

Portfolio composition

No single product >60% ideal

Single product >80% (no diversification)

Cohort Analysis

Group customers by join date; track behavior

Whether business improving or degrading

Recent cohorts same/better than old

Newer cohorts perform worse

CAC Payback by Channel

CAC / Monthly Contribution (by channel)

Payback by acquisition channel

Compare across channels

One channel far worse than others

Gross Margin Payback

CAC / (Monthly ARPU × Gross Margin %)

Payback using actual profit

Typically 1.5-2x simple payback

Payback using margin >36 months

Unit Economics

Revenue per unit - Cost per unit

Profitability of each "unit"

Positive contribution required

Negative contribution margin

Segment Payback

CAC / Monthly Contribution (by segment)

Payback by customer segment

Compare to allocate resources

One segment unprofitable

Incrementality

Revenue caused by action - Baseline

True impact of marketing/promo

Measure with holdout tests

Celebrating revenue that would've happened anyway

Working Capital

Cash timing between revenue and collection

Cash vs. revenue timing

Annual upfront > monthly billing

Long payment terms killing runway

Red Flag	What It Means	Action
Churn increasing cohort-over-cohort	Product-market fit degrading	Stop scaling acquisition; fix retention first
NRR <100%	Base is contracting	Fix expansion or reduce churn before scaling
Revenue churn > logo churn	Losing big customers	Investigate why high-value customers leave
Quick Ratio <2	Leaky bucket (barely outpacing losses)	Fix retention before scaling acquisition
Expansion revenue <10% of MRR	No upsell/cross-sell engine	Build expansion paths
Revenue concentration >50% in top 10 customers	Existential dependency risk	Diversify customer base

Red Flag	What It Means	Action
LTV:CAC <1.5:1	Buying revenue at a loss	Reduce CAC or increase LTV before scaling
Payback >24 months	Cash trap (long cash recovery)	Negotiate annual upfront or reduce CAC
Gross margin <60%	Low profitability per dollar	Increase prices or reduce COGS
CAC increasing while LTV flat	Unit economics degrading	Optimize conversion or reduce sales cycle
Contribution margin <40%	Unprofitable after variable costs	Cut variable costs or increase prices

Red Flag	What It Means	Action
Runway <6 months	Survival crisis	Raise capital immediately or cut burn
Net burn accelerating without revenue growth	Burning faster without results	Cut costs or increase revenue urgency
OpEx growing faster than revenue	Negative operating leverage	Freeze hiring; optimize spend
Rule of 40 <25	Burning cash without growth	Improve growth or cut to profitability
Magic Number <0.5	S&M engine broken	Fix GTM efficiency before scaling spend

Finance Metrics Quickref

Purpose

Input

Key Concepts

Metric Categories

When to Use This Skill

Application

All Metrics Reference Table

Quick Decision Frameworks

Framework 1: Should We Build This Feature?

Framework 2: Should We Scale This Acquisition Channel?

Framework 3: Should We Change Pricing?

Framework 4: Is the Business Healthy?

Red Flags by Category

Revenue & Growth Red Flags

Unit Economics Red Flags

Capital Efficiency Red Flags

When to Use Which Metric

Examples

Example 1: Feature Investment Sanity Check

Example 2: Channel Scale Decision

Common Pitfalls

References

Related Skills (Deep Dives)

External Resources

Provenance