SaaS KPIs are the key performance indicators a software-as-a-service company uses to track recurring revenue growth, customer retention, unit economics and capital efficiency. The core set is MRR and ARR, churn, net revenue retention (NRR), customer acquisition cost (CAC), customer lifetime value (LTV), CAC payback, burn multiple and the Rule of 40.
Together they answer the questions every founder, investor and lender asks: is recurring revenue growing faster than it leaks out, and is each new customer worth what it costs to win? Below are 12 KPIs with their formulas and, where a published benchmark exists, the current figure and its source.
Key Takeaways
- The median private B2B SaaS company kept 101% of its revenue from existing customers in 2024 including expansion (NRR) and 91% before expansion (GRR), per SaaS Capital’s 2025 survey of more than 1,000 companies.
- Median CAC payback was 16 months in 2025, and 6 months or less for the top quartile, in Benchmarkit and Aleph’s 2026 report (198 of 342 companies reported it).
- Burn multiple is net burn divided by net new ARR; David Sacks, who coined it in 2020, rates under 1x as amazing and over 3x as bad.
- Median growth was 25% in 2024 across private B2B SaaS companies, and 40% for companies under $1M ARR, according to SaaS Capital’s 2025 growth survey.
- Only 27.9% of 1,377 venture-backed private companies across industries cleared the Rule of 40 in Q1 2026, in Standard Metrics’ July 2026 report.
The 12 SaaS KPIs at a Glance
NetSuite describes SaaS KPIs as “performance measurements that inform a company’s financial and operational decisions.” Here are the 12 below, grouped by the question each answers:
| KPI | Formula | Benchmark | Source |
|---|---|---|---|
| MRR | Customers × average monthly revenue per customer | Track monthly growth | Definition |
| ARR | MRR × 12 | Median growth 25% (2024) | SaaS Capital 2025 |
| ARPU | Recurring revenue ÷ customers | Track by plan and segment | Definition |
| Customer churn | Customers lost ÷ customers at start of period | Track monthly and annually | Definition |
| Gross revenue retention (GRR) | Revenue kept from existing customers, before expansion, ÷ starting revenue | Median 91% | SaaS Capital 2025 |
| Net revenue retention (NRR) | (Starting revenue + expansion − contraction − churn) ÷ starting revenue | Median 101% | SaaS Capital 2025 |
| CAC | Sales and marketing spend ÷ new customers | Compare with LTV and payback | Definition |
| LTV | ARPU × gross margin ÷ monthly churn | Above 3 × CAC | David Skok |
| LTV:CAC | LTV ÷ CAC | Above 3 | David Skok |
| CAC payback | CAC ÷ (ARPU × gross margin) | Median 16 months; under 12 for SMB | Benchmarkit 2026; Bessemer |
| Burn multiple | Net burn ÷ net new ARR | Under 1x amazing, over 3x bad | David Sacks |
| Rule of 40 | Revenue growth % + profit margin % | 40 or more | Brad Feld |
Revenue and Growth KPIs
Monthly recurring revenue (MRR)
MRR is the predictable revenue your subscriptions bring in each month. Calculate it as the number of paying customers multiplied by average monthly revenue per customer, and break the change into its parts so you can see what moved it. Our MRR calculator does the arithmetic.
Ending MRR = starting MRR + new MRR + expansion MRR − contraction MRR − churned MRR
- New MRR: revenue from customers who signed up this month.
- Expansion MRR: upgrades, extra seats and add-ons from existing customers.
- Contraction MRR: downgrades from existing customers.
- Churned MRR: revenue lost from customers who cancelled.
Annual recurring revenue (ARR)
ARR is MRR multiplied by 12, the annualized value of your current subscriptions (ARR calculator). It is the number investors and lenders use to size a SaaS company, and the base for growth benchmarks. In SaaS Capital’s 2025 growth survey of more than 1,000 private B2B SaaS companies, median year-over-year revenue growth in 2024 was 25%, and smaller companies grew faster:
| ARR band | Median growth in 2024 |
|---|---|
| Under $1M | 40% |
| $1M to $3M | 28% |
| $3M to $5M | 24% |
| $5M to $10M | 24% |
| $10M to $20M | 20% |
| Over $20M | 20% |
For growth rate formulas and more benchmarks, see our SaaS growth rate guide.
Average revenue per user (ARPU)
ARPU is recurring revenue divided by the number of customers (some teams use accounts, ARPA, when one customer has many users). Track it by plan and by segment: a rising ARPU with flat customer count means pricing or expansion is working, and ARPU is an input to LTV and CAC payback below.
Retention and Churn KPIs
Customer churn rate
Customer churn, also called logo churn, is the share of customers who cancel in a period: customers lost divided by customers at the start of the period. It tells you how many accounts you keep, not how much revenue (churn rate calculator).
Revenue churn and gross revenue retention (GRR)
Revenue churn measures the recurring revenue lost to cancellations and downgrades, divided by revenue at the start of the period. Gross revenue retention is its mirror image: the share of starting revenue you keep from existing customers, ignoring expansion, so it can never exceed 100%. Losing a few large customers can hurt revenue churn badly while customer churn looks fine.
Small monthly rates compound. David Skok points out that “at 2% monthly churn, you are losing about 22% of your revenue every year.”
Net revenue retention (NRR)
NRR adds expansion back in: NRR = (starting revenue + expansion − contraction − churn) ÷ starting revenue, for the same group of customers over a year. Above 100% means existing customers grow faster than they leave (NRR calculator).
Benchmarks are annual. SaaS Capital’s 2025 retention benchmarks, from its survey of more than 1,000 private B2B SaaS companies, found a median NRR of 101% and a median GRR of 91% for 2024 (breakdown by contract size). NRR also feeds valuation; see how NRR moves SaaS multiples.
Segment your retention KPIs
A company-wide average can hide the problem. Mauricio Kigiela, founder of the SaaS company Docsales, told a Founder500 audience in September 2022 that his accounting-firm customers looked healthy on average: CAC paid back in about four months and churn averaged 1.4% a month. When the team split those customers by number of users, one group was churning 5.3% a month (watch at 9:08). His slide put it plainly:
Overall Churn rate is not the most important KPI to follow on a SaaS Business. Understand why your customers are churning. Churn can be predicted by customer behavior several months before it really happens.
Mauricio Kigiela, Founder and CEO, Docsales. See slide 16
Unit Economics KPIs
Customer acquisition cost (CAC)
CAC is total sales and marketing spend in a period divided by the number of new customers won in that period. Include salaries, tools and agencies, not only ad spend, and calculate it by channel so you can see which ones pay off (CAC calculator).
Customer lifetime value (LTV)
LTV estimates the gross profit a customer brings in before they leave. The simple version divides monthly ARPU by monthly churn; the better version, which David Skok recommends, multiplies by gross margin so you count profit rather than revenue (LTV calculator):
LTV = ARPU × gross margin ÷ monthly churn rate
Treat young LTV figures with care. If most of your customers signed up in the last year or two, one divided by churn is an estimate of a lifetime you haven’t observed yet.
LTV:CAC ratio
LTV divided by CAC shows how many dollars of gross profit each acquisition dollar returns. Skok writes that “the best SaaS businesses have a LTV to CAC ratio that is higher than 3, sometimes as high as 7 or 8.” A ratio near 1 means you spend about as much to win a customer as they will ever earn you.
CAC payback period
CAC payback is the number of months a new customer takes to repay what you spent to acquire them, in gross profit: CAC payback = CAC ÷ (monthly ARPU × gross margin) (payback period calculator). It matters more than LTV:CAC when cash is tight, because a long payback has to be financed.
Bessemer Venture Partners suggests targeting under 12 months for SMB customers, under 18 months for mid-market and under 24 months for enterprise. In Benchmarkit and Aleph’s 2026 report on 342 SaaS and AI-native companies (198 reported CAC payback), median CAC payback improved from 18 months in 2024 to 16 months in 2025, and the top quartile paid back in 6 months or less.
Worked example: unit economics for one customer
Take a customer on a $500 a month plan, an 80% gross margin, a CAC of $6,000 and monthly churn of 1.5%:
| KPI | Calculation | Result |
|---|---|---|
| CAC payback | $6,000 ÷ ($500 × 80%) | 15 months |
| Average lifetime | 1 ÷ 1.5% | About 67 months |
| LTV | $500 × 80% ÷ 1.5% | About $26,700 |
| LTV:CAC | About $26,700 ÷ $6,000 | About 4.4 |
The ratio clears Skok’s 3:1 guideline (he set it for the simpler LTV without a gross margin adjustment, which gives about 5.6 here), and a 15-month payback is a little better than the 2025 median. The weak spot is cash: the company waits more than a year to recover each acquisition, so faster growth means more cash out before it comes back.
Efficiency KPIs: Burn Multiple and the Rule of 40
Burn rate and runway
- Gross burn is total monthly operating spend.
- Net burn is cash out minus cash in for the month.
- Runway is cash on hand divided by net burn: the months left before the money runs out.
Our burn rate calculator and runway calculator work these out from your numbers.
Burn multiple
Burn multiple measures how much cash you burn to add each dollar of new recurring revenue. David Sacks of Craft Ventures introduced it in a 2020 essay, flipping Bessemer’s earlier efficiency score so that lower is better:
Burn multiple = net burn ÷ net new ARR
Use the same period for both numbers. In Sacks’ example, a company that burns $2 million in a quarter and adds $1 million of net new ARR has a burn multiple of 2x. His rules of thumb for venture-stage startups: under 1x is amazing, 1x to 1.5x great, 1.5x to 2x good, 2x to 3x suspect and over 3x bad.
Sacks expects the multiple to fall as a company matures, and reads anything above 3x as a sign that product-market fit isn’t what it appears to be. A profitable company has no net burn, so the measure matters most when you are spending cash to grow.
Rule of 40
The Rule of 40 combines growth and profit into one number: revenue growth rate (%) + profit margin (%) ≥ 40. Name the margin you use; EBITDA margin and free cash flow margin are the common choices (Rule of 40 calculator).
Brad Feld popularized the rule in 2015 after hearing it from a late-stage investor, and scoped it to “SaaS companies at scale”, with at least $50 million in revenue. Few companies clear it: in Standard Metrics’ July 2026 report, 27.9% of 1,377 venture-backed private companies across industries, with $1 million or more in annualized revenue passed in Q1 2026, most of them on growth alone. Below about $50 million in revenue, use it as a direction rather than a pass mark.
Which SaaS KPIs to Track at Your Stage
| Stage | Focus on | Why |
|---|---|---|
| Under $1M ARR | MRR growth, customer churn, CAC payback | You need proof that customers stay and that acquisition pays back before the cash runs out |
| $1M to $10M ARR | NRR and GRR, CAC payback by channel, burn multiple | Growth now depends on keeping and expanding accounts and on spending efficiently |
| Over $10M ARR | NRR, Rule of 40, burn multiple | Investors and acquirers weigh growth against profitability |
Whatever the stage, calculate each KPI the same way every month, from your billing system rather than a spreadsheet you update by hand, and split it by segment before you trust the average.
How Lenders Read Your KPIs
Revenue-based lenders look at the same numbers. Founderpath underwrites from your connected billing, banking and accounting data instead of a pitch deck, so recurring revenue, retention and margins can turn into growth capital without selling equity.
Founderpath provides non-dilutive capital for B2B SaaS companies with at least $10K MRR. There’s no equity, no warrants, no board seats and no personal guarantees. Connect your billing, banking and accounting data, and most founders see funds within 24-48 hours.
Check what you qualify for. It takes less than 5 minutes.
SaaS KPIs FAQ
What are SaaS KPIs?
SaaS KPIs are the key performance indicators a software-as-a-service company uses to track recurring revenue growth, customer retention, unit economics and capital efficiency. Common ones are MRR, ARR, churn, net revenue retention, CAC, LTV, CAC payback, burn multiple and the Rule of 40.
What are the most important SaaS KPIs?
If you track only three, track MRR growth, revenue churn (or net revenue retention) and CAC payback. Together they show whether revenue is growing, whether it stays, and how long each new customer takes to pay back what you spent to win them.
What is a good burn multiple?
David Sacks, who coined the burn multiple in 2020, rates under 1x as amazing, 1x to 1.5x as great, 1.5x to 2x as good, 2x to 3x as suspect and over 3x as bad. He calls these rules of thumb for venture-stage startups and expects the multiple to fall as a company matures.
How do you calculate burn multiple?
Divide net burn by net new ARR for the same period. If a company burns $2 million in a quarter and adds $1 million of net new ARR, its burn multiple is 2x: it spent two dollars of cash for each dollar of new recurring revenue.
What is the Rule of 40 in SaaS?
The Rule of 40 says a SaaS company’s revenue growth rate plus its profit margin should add up to at least 40%. Brad Feld popularized it in 2015 for companies with at least $50 million in revenue. In Standard Metrics’ Q1 2026 data, 27.9% of 1,377 venture-backed private companies across industries cleared it.
What is a good net revenue retention rate for SaaS?
Above 100% means existing customers grow faster than they leave. SaaS Capital’s 2025 survey of more than 1,000 private B2B SaaS companies found a median net revenue retention of 101% and a median gross revenue retention of 91%, measured over 2024.
What is a good CAC payback period?
Bessemer suggests targeting under 12 months for SMB customers, under 18 months for mid-market and under 24 months for enterprise. In Benchmarkit and Aleph’s 2026 report, the median across the 198 companies that reported it was 16 months for 2025 and the top quartile was 6 months or less.
What is the difference between a SaaS metric and a KPI?
Every KPI is a metric, but not every metric is a KPI. A metric is anything you can measure, such as page views or support tickets. A KPI is one of the few metrics tied directly to a business goal, such as net revenue retention for a goal of growing existing accounts.
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