SaaS Metrics and Finance
Most founders track the wrong metrics, or track the right metrics incorrectly. This course gives you a precise, practical understanding of the numbers that matter in a SaaS business — how to calculate them, what they mean, how they connect, and how to use them to make better decisions about growth, pricing, and fundraising.
What you'll learn
Course outline
Free — no account needed
The SaaS Metrics That Actually Matter
MRR, ARR, churn, NRR, LTV, CAC — definitions, how they connect, and which ones to track when
Revenue Metrics — MRR, ARR, and Expansion Revenue
New MRR, expansion MRR, contraction MRR, churned MRR, how to calculate each, MRR waterfall chart
Churn — Measuring, Understanding, and Reducing It
Logo churn vs revenue churn, why NRR beats gross retention, cohort analysis basics, early warning signals
Full course — $49 one-time
Unit Economics — CAC, LTV, and Payback Period
Customer acquisition cost by channel, LTV calculation, LTV:CAC ratio targets, payback period, what good looks like by stage
The SaaS P&L — Gross Margin, Burn, and Runway
Gross margin benchmarks, COGS breakdown, operating expenses, burn rate, runway calculation, default alive vs default dead
Investor Metrics and the Rule of 40
What investors look for at seed vs Series A, ARR growth rate, the Rule of 40, NRR benchmarks, metrics dashboard founders should have ready
Building Your Metrics Dashboard
What to track in a spreadsheet vs a tool, setting up Stripe to feed your metrics, the weekly metrics review habit
Get the full course
7 lessons — practical, project-based, no fluff.
About this course
Most founders understand their product and their customers far better than they understand their numbers. But SaaS metrics are not just investor-speak — they are the instrumentation that tells you whether your business is working. MRR shows you what is real. Churn shows you what you are losing. LTV:CAC shows you whether growth is sustainable. Without these numbers, you are flying blind. This course teaches you to calculate, interpret, and act on the metrics that matter in a subscription business.
This is not an accounting course. It is a metrics course for founders who need to make decisions — should I invest in growth or fix retention first? Is this pricing change working? What do investors want to see? By the end, you will have a spreadsheet model for your own business and a clear understanding of which number to focus on at each stage of growth.
Frequently asked questions
What is MRR and how is it different from revenue?
MRR (Monthly Recurring Revenue) is the normalised monthly value of all active subscriptions. If a customer pays $120/year, that is $10 MRR. Revenue (in accounting terms) is recognised when earned — for annual prepaid subscriptions, the revenue is spread across 12 months. Investors look at MRR because it reflects the recurring, predictable component of your business. Be careful: MRR is not cash — an annual customer paying upfront gives you $120 in cash but only $10/month in MRR.
What is a good churn rate for SaaS?
It depends heavily on your market and price point. Consumer SaaS typically sees 3–8% monthly churn. SMB SaaS: 1.5–3% monthly. Mid-market: 0.5–1.5% monthly. Enterprise: below 0.5% monthly. Any monthly churn above 5% is very difficult to grow through — you are losing more than 50% of revenue per year and need extremely high new customer acquisition just to stay flat. Focus on churn before investing heavily in acquisition.
What is net revenue retention (NRR) and why do investors care about it?
NRR measures how much revenue you retain from existing customers over time, including expansion (upsells, seat growth) and excluding churn and contraction. NRR above 100% means your existing customer base is growing on its own — you would grow even if you stopped acquiring new customers. NRR of 120%+ is considered excellent and is a key indicator of product-market fit. Investors value it because it shows the business can compound without purely relying on new customer sales.
How do I calculate LTV and CAC?
CAC (Customer Acquisition Cost) = total sales and marketing spend / number of new customers acquired in the same period. LTV (Lifetime Value) = ARPU × gross margin % / monthly churn rate. Example: $50 ARPU, 70% gross margin, 2% monthly churn → LTV = $50 × 0.70 / 0.02 = $1,750. LTV:CAC ratio of 3:1 or better is the common benchmark. Payback period (CAC / monthly gross profit per customer) should be under 12–18 months.
When should I start tracking these metrics?
Start tracking MRR and churn from your first paying customer. You cannot improve what you do not measure, and the habits formed early persist. For a pre-revenue product, track leading indicators instead: free trial activation rates, feature engagement depth, and NPS. LTV:CAC matters once you have 3–6 months of data and have spent real money acquiring customers. Do not wait until you are raising a round — build the model when the numbers are small so you understand it when the stakes are high.