/finance-metrics-quickref

name: finance-metrics-quickref
description: Look up SaaS finance metrics, formulas, and benchmarks fast. Use when you need a quick metric definition, formula, or benchmark during analysis.
intent: >-
  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.
type: component
best_for:
  - "Quick metric lookups during product or finance reviews"
  - "Checking formulas and benchmarks without reading a long explainer"
  - "Refreshing decision rules for common SaaS metrics"
scenarios:
  - "What is the formula for NRR and what is a good benchmark?"
  - "Give me a quick reference for CAC payback and Rule of 40"
  - "I need a fast SaaS metrics cheat sheet for a business review"

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.

Key Concepts

Metric Categories

Metrics are organized into four families:

1. **Revenue & Growth** — Top-line money (revenue, ARPU, ARPA, MRR/ARR, churn, NRR, expansion) 2. **Unit Economics** — Customer-level profitability (CAC, LTV, payback, margins) 3. **Capital Efficiency** — Cash management (burn rate, runway, OpEx, net income) 4. **Efficiency Ratios** — Growth vs. profitability balance (Rule of 40, magic number)

When to Use This Skill

**Use this when:**

• You need a quick formula or benchmark
• You're preparing for a board meeting or investor call
• You're evaluating a decision and need to check which metrics matter
• You want to identify red flags quickly

**Don't use this when:**

• You need detailed calculation guidance (use `saas-revenue-growth-metrics` or `saas-economics-efficiency-metrics`)
• You're learning these metrics for the first time (start with deep-dive skills)
• You need examples and common pitfalls (covered in related skills)

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Application

All Metrics Reference Table

| **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 >