Guides
SaaS metrics guides
The formulas behind the six calculators, written out with worked examples, benchmark ranges and the mistakes that make the numbers wrong. Start with the cheat sheet if you want all six in one place.
- SaaS Metrics Cheat SheetSix core SaaS metrics with their formulas, healthy benchmarks and links to free calculators: MRR, churn, LTV:CAC, CAC payback, quick ratio and runway.Read the guide →
- CAC Payback Period: Formula and BenchmarksCAC payback is CAC divided by monthly gross profit per customer. See the formula, a worked example, benchmarks by segment and the mistakes that shorten it.Read the guide →
- Churn Rate FormulaThe churn rate formula is customers lost divided by customers at the start of the period. Includes revenue churn, Excel formulas, examples and benchmarks.Read the guide →
- MRR vs ARR: How to Calculate BothMRR is recurring revenue normalised to one month; ARR is MRR × 12. Learn the normalisation rules, what to exclude, and the mistakes that inflate both.Read the guide →
- Net Revenue Retention: Formula and BenchmarksNet revenue retention is this period’s revenue from last period’s customers divided by last period’s revenue. See the formula, NRR vs GRR, and the mistakes that inflate it.Read the guide →
- SaaS Quick Ratio: Formula and BenchmarksThe SaaS quick ratio is (new MRR + expansion) ÷ (churned MRR + contraction). Learn the formula, benchmark bands, worked example and common mistakes.Read the guide →
- Startup Runway: What It Means and How to Calculate ItRunway is cash divided by net monthly burn. Learn the formula, why net burn matters, the profitable-business case, and how much runway you should hold.Read the guide →
- The Rule of 40The Rule of 40 says growth rate plus profit margin should exceed 40%. See the formula, which margin to use, segment benchmarks, and where the rule breaks down.Read the guide →
- The SaaS Magic NumberThe SaaS magic number is net new ARR divided by last quarter’s sales and marketing spend. See the formula, the 0.75 benchmark, and what it hides about payback.Read the guide →
- What Is a Good LTV:CAC Ratio?A good LTV:CAC ratio is about 3x for most B2B SaaS. See benchmarks by segment, why the ratio must use gross profit, and the mistakes that inflate it.Read the guide →
Where these fit
Each guide explains one metric end to end and then links to the calculator that computes it from your own inputs. The calculators are free and need no signup; the guides exist so you can check the definition before trusting the number.
If you want the benchmark tables without the explanation, they are collected on the SaaS metrics benchmarks page.