The metrics that actually matter.
Eight numbers tell you whether your startup is healthy and whether investors will think so too. Here is what each one means, how to read it, and the benchmark to aim for.
Runway and net burn
Months of cash left at your current net burn (gross spend minus revenue).
How to read it: Track it weekly, not from a month-old close. Separate one-time from recurring spend so a lumpy month does not read as a trend.
Benchmark: Aim to keep 18-24 months after a raise. Under 6 months is a fundraise-or-cut signal.
Burn multiple
Net burn divided by net new ARR. How much you spend to add a dollar of recurring revenue.
How to read it: Lower is better. It is the single cleanest read on capital efficiency for a growing SaaS company.
Benchmark: Under 1 is excellent, 1 to 1.5 is good, over 2 needs attention (Bessemer framework).
Gross margin and cost to serve
Revenue minus cost of revenue (hosting, compute, payment fees, delivery), as a percentage.
How to read it: Watch compute and inference as their own line so you know what it actually costs to serve a user.
Benchmark: Software targets 70 to 80%+. AI products often run lower early; the trend matters more than the level.
MRR / ARR and growth rate
Recurring revenue and how fast it compounds month over month.
How to read it: Recognize usage, credits, and overages correctly, or growth looks lumpier than it is.
Benchmark: Early-stage strong growth is often 10 to 20% month over month; it should decelerate gracefully with scale.
Net revenue retention
Revenue from existing customers this year vs last, including expansion and churn.
How to read it: NRR above 100% means you grow even with zero new logos. It is the metric investors probe hardest.
Benchmark: Over 100% is healthy; 110 to 120%+ is strong for SaaS.
CAC and CAC payback
Fully loaded cost to acquire a customer, and how many months of gross profit it takes to earn it back.
How to read it: Load in everything (ads, salaries, tools). Payback is more honest than CAC alone.
Benchmark: SMB payback under ~12 months is good; enterprise under ~18 to 24.
LTV to CAC
Lifetime gross profit per customer divided by what it cost to acquire them.
How to read it: Use gross profit, not revenue, for LTV. Be conservative on lifetime for early data.
Benchmark: Roughly 3x or better is the common rule of thumb; much higher can mean underinvesting in growth.
Rule of 40
Revenue growth rate plus profit (or free-cash-flow) margin.
How to read it: A simple balance check between growth and burn that scales with you.
Benchmark: A combined 40%+ is the widely cited bar for an efficient growth-stage company.
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