Track the metrics that matter. This guide breaks down essential KPIs for SaaS, consumer apps, and marketplaces—plus how to build your metrics dashboard.
Essential Startup Metrics
What gets measured gets managed. This guide covers the key metrics every startup should track.
Metrics by Business Model
Different business models require different metrics. Here are the essentials for each.
B2B SaaS Metrics
Core SaaS Metrics:
- MRR (Monthly Recurring Revenue): Total recurring revenue per month. Track New, Expansion, Contraction, Churned MRR.
- ARR (Annual Recurring Revenue): MRR × 12. Use for annual reporting and valuation.
- CAC (Customer Acquisition Cost): Total sales & marketing spend ÷ new customers acquired.
- LTV (Lifetime Value): ARPU ÷ churn rate. Should be 3x CAC minimum.
- Churn Rate: % of customers who cancel each month. Under 2% monthly for good SaaS.
- NRR (Net Revenue Retention): (Starting MRR + Expansion - Churn) ÷ Starting MRR. Target: 110%+
SaaS Benchmarks:
- Good: CAC Payback < 12 months, LTV:CAC > 3:1, Churn < 2%/month
- Great: CAC Payback < 6 months, LTV:CAC > 5:1, Churn < 1%/month
Consumer/Mobile App Metrics
Key App Metrics:
- DAU/MAU Ratio: Daily Active Users ÷ Monthly Active Users. Shows stickiness. Target: 20%+
- Retention Curves: Track D1, D7, D30 retention. Should flatten after initial drop.
- K-Factor: Viral coefficient. Each user brings K new users. K > 1 = viral growth.
- ARPU (Average Revenue Per User): Total revenue ÷ total users.
- Conversion Rate: % of free users who convert to paid. Target: 2-5%.
Marketplace Metrics
Marketplace Metrics:
- GMV (Gross Merchandise Value): Total value of all transactions.
- Take Rate: % of GMV you keep as revenue. Typical: 10-30%.
- Supply/Demand Balance: Ratio of suppliers to buyers. Should be roughly balanced.
- Repeat Purchase Rate: % of customers who buy again. Target: 30%+ within 90 days.
- Liquidity Score: % of listings that result in transactions. Higher = better marketplace health.
The Pirate Metrics (AARRR) Framework
Dave McClure's framework for tracking the customer funnel at every stage:
AARRR Metrics:
- Acquisition: How do users find you? Track traffic sources, conversion rates.
- Activation: Do users have a great first experience? Track signup flow completion.
- Retention: Do users come back? Track D1, D7, D30 retention cohorts.
- Revenue: How do you monetize? Track ARPU, conversion rates, payment flow.
- Referral: Do users tell others? Track K-factor, referral rate, virality.
Financial Metrics
Track these financial metrics to ensure sustainable growth:
Essential Financial Metrics:
- Burn Rate: Cash spent per month. Know your monthly burn to the dollar.
- Runway: Months until you run out of cash. Cash in bank ÷ burn rate.
- Gross Margin: (Revenue - COGS) ÷ Revenue. Should be 70%+ for SaaS.
- Operating Margin: (Revenue - All Expenses) ÷ Revenue. Path to profitability.
- Cash Flow: Cash in - Cash out. Positive cash flow = sustainability.
Building Your Dashboard
Create a simple dashboard that you review weekly. Don't overcomplicate it.
Recommended Dashboard Tools:
- Google Sheets/Excel: Perfect for early stage. Simple, flexible, free.
- Amplitude/Mixpanel: Product analytics. Event tracking, cohort analysis.
- ChartMogul/Baremetrics: SaaS metrics. MRR, churn, LTV automated.
- Stripe Dashboard: Financial metrics if you use Stripe for payments.
Pro Tip:
Pick 5-7 core metrics that matter most for your business model. Review them weekly. Everything else is noise. Focus on metrics you can actually influence through your actions.
