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startup-metrics-framework This skill should be used when the user asks about "key startup metrics", "SaaS metrics", "CAC and LTV", "unit economics", "burn multiple", "rule of 40", "marketplace metrics", or requests guidance on tracking and optimizing business performance metrics.
npx skills add wshobson/agents --skill startup-metrics-framework agents claude claude-code subagents anthropic automation
Startup Metrics Framework
Comprehensive guide to tracking, calculating, and optimizing key performance metrics for different startup business models from seed through Series A.
Overview
Track the right metrics at the right stage. Focus on unit economics, growth efficiency, and cash management metrics that matter for fundraising and operational excellence.
Universal Startup Metrics
Revenue Metrics
MRR (Monthly Recurring Revenue)
MRR = Σ (Active Subscriptions × Monthly Price)
ARR (Annual Recurring Revenue)
ARR = MRR × 12
Growth Rate
MoM Growth = (This Month MRR - Last Month MRR) / Last Month MRR
YoY Growth = (This Year ARR - Last Year ARR) / Last Year ARR
Target Benchmarks:
Seed stage: 15-20% MoM growth
Series A: 10-15% MoM growth, 3-5x YoY
Series B+: 100%+ YoY (Rule of 40)
Unit Economics
CAC (Customer Acquisition Cost)
CAC = Total S&M Spend / New Customers Acquired
Include: Sales salaries, marketing spend, tools, overhead
LTV = ARPU × Gross Margin% × (1 / Churn Rate)
LTV = ARPU × Average Customer Lifetime × Gross Margin%
LTV:CAC > 3.0 = Healthy
LTV:CAC 1.0-3.0 = Needs improvement
LTV:CAC < 1.0 = Unsustainable
CAC Payback = CAC / (ARPU × Gross Margin%)
< 12 months = Excellent
12-18 months = Good
24 months = Concerning
Cash Efficiency Metrics Monthly Burn = Monthly Revenue - Monthly Expenses
Negative burn = losing money (typical early-stage)
Runway (months) = Cash Balance / Monthly Burn Rate
Target: Always maintain 12-18 months runway
Burn Multiple = Net Burn / Net New ARR
< 1.0 = Exceptional efficiency
1.0-1.5 = Good
1.5-2.0 = Acceptable
2.0 = Inefficient
Lower is better (spending less to generate ARR)
SaaS Metrics
Revenue Composition New MRR
New customers × ARPU
Expansion MRR
Upsells and cross-sells from existing customers
Contraction MRR
Downgrades from existing customers
Churned MRR
Lost customers
Net New MRR = New MRR + Expansion MRR - Contraction MRR - Churned MRR
Retention Metrics Logo Retention = (Customers End - New Customers) / Customers Start
Dollar Retention (NDR - Net Dollar Retention)
NDR = (ARR Start + Expansion - Contraction - Churn) / ARR Start
NDR > 120% = Best-in-class
NDR 100-120% = Good
NDR < 100% = Needs work
Gross Retention = (ARR Start - Churn - Contraction) / ARR Start
90% = Excellent
85-90% = Good
< 85% = Concerning
SaaS-Specific Metrics Magic Number = Net New ARR (quarter) / S&M Spend (prior quarter)
0.75 = Efficient, ready to scale
0.5-0.75 = Moderate efficiency
< 0.5 = Inefficient, don't scale yet
Rule of 40 = Revenue Growth Rate% + Profit Margin%
40% = Excellent
20-40% = Acceptable
< 20% = Needs improvement
Example:
50% growth + (10%) margin = 40% ✓
Quick Ratio = (New MRR + Expansion MRR) / (Churned MRR + Contraction MRR)
4.0 = Healthy growth
2.0-4.0 = Moderate
< 2.0 = Churn problem
Marketplace Metrics
GMV (Gross Merchandise Value) Total Transaction Volume:
GMV = Σ (Transaction Value)
GMV Growth Rate = (Current Period GMV - Prior Period GMV) / Prior Period GMV
Target: 20%+ MoM early-stage
Take Rate Take Rate = Net Revenue / GMV
Payment processors: 2-3%
E-commerce marketplaces: 10-20%
Service marketplaces: 15-25%
High-value B2B: 5-15%
Marketplace Liquidity Time to Transaction
How long from listing to sale/match?
Fill Rate
% of requests that result in transaction
Repeat Rate
% of users who transact multiple times
Fill rate > 80% = Strong liquidity
Repeat rate > 60% = Strong retention
Marketplace Balance Supply/Demand Ratio:
Track relative growth of supply and demand sides.
Too much supply: Low fill rates, frustrated suppliers
Too much demand: Long wait times, frustrated customers
Goal: Balanced growth (1:1 ratio ideal, but varies by model)
Consumer/Mobile Metrics
Engagement Metrics DAU (Daily Active Users)
Unique users active each day
MAU (Monthly Active Users)
Unique users active each month
50% = Exceptional (daily habit)
20-50% = Good
< 20% = Weak engagement
Session Frequency
Average sessions per user per day/week
Session Duration
Average time spent per session
Retention Curves Day 1 Retention: % users who return next day
Day 7 Retention: % users active 7 days after signup
Day 30 Retention: % users active 30 days after signup
40% = Excellent
25-40% = Good
< 25% = Weak
Flattening curve = good (users becoming habitual)
Steep decline = poor product-market fit
Viral Coefficient (K-Factor) K-Factor = Invites per User × Invite Conversion Rate
Example:
10 invites/user × 20% conversion = 2.0 K-factor
K > 1.0 = Viral growth
K = 0.5-1.0 = Strong referrals
K < 0.5 = Weak virality
B2B Metrics
Sales Efficiency Win Rate = Deals Won / Total Opportunities
Target: 20-30% for new sales team, 30-40% mature
Sales Cycle Length
Average days from opportunity to close
SMB: 30-60 days
Mid-market: 60-120 days
Enterprise: 120-270 days
Average Contract Value (ACV)
ACV = Total Contract Value / Contract Length (years)
Pipeline Metrics Pipeline Coverage = Total Pipeline Value / Quota
Target: 3-5x coverage (3-5x pipeline needed to hit quota)
Conversion Rates by Stage:
Lead → Opportunity: 10-20%
Opportunity → Demo: 50-70%
Demo → Proposal: 30-50%
Proposal → Close: 20-40%
Metrics by Stage
Pre-Seed (Product-Market Fit)
Active users growth
User retention (Day 7, Day 30)
Core engagement (sessions, features used)
Qualitative feedback (NPS, interviews)
Revenue (may be zero)
CAC (not optimizing yet)
Unit economics
Seed ($500K-$2M ARR)
MRR growth rate (15-20% MoM)
CAC and LTV (establish baseline)
Gross retention (> 85%)
Core product engagement
Sales efficiency
Burn rate and runway
Series A ($2M-$10M ARR)
ARR growth (3-5x YoY)
Unit economics (LTV:CAC > 3, payback < 18 months)
Net dollar retention (> 100%)
Burn multiple (< 2.0)
Magic number (> 0.5)
Rule of 40
Sales efficiency
Pipeline coverage
Metric Tracking Best Practices
Data Infrastructure
Single source of truth (analytics platform)
Real-time or daily updates
Automated calculations
Historical tracking
Mixpanel, Amplitude (product analytics)
ChartMogul, Baremetrics (SaaS metrics)
Looker, Tableau (BI dashboards)
Reporting Cadence
MRR, active users
Sign-ups, conversions
Growth rates
Retention cohorts
Sales pipeline
Full metric suite
Board reporting
Investor updates
Trend analysis
Benchmarking
Strategy review
Common Mistakes Mistake 1: Vanity Metrics
Don't focus on:
Total users (without retention)
Page views (without engagement)
Downloads (without activation)
Focus on actionable metrics tied to value.
Mistake 2: Too Many Metrics
Track 5-7 core metrics intensely, not 50 loosely.
Mistake 3: Ignoring Unit Economics
CAC and LTV are critical even at seed stage.
Mistake 4: Not Segmenting
Break down metrics by customer segment, channel, cohort.
Mistake 5: Gaming Metrics
Optimize for real business outcomes, not dashboard numbers.
Investor Metrics
What VCs Want to See
MRR growth rate
User retention
Early unit economics
Product engagement
ARR and growth rate
CAC payback < 18 months
LTV:CAC > 3.0
Net dollar retention > 100%
Burn multiple < 2.0
Rule of 40 > 40%
Efficient growth (magic number)
Path to profitability
Market leadership metrics
Metric Presentation Current MRR: $250K (↑ 18% MoM)
ARR: $3.0M (↑ 280% YoY)
CAC: $1,200 | LTV: $4,800 | LTV:CAC = 4.0x
NDR: 112% | Logo Retention: 92%
Burn: $180K/mo | Runway: 18 months
Current value
Growth rate or trend
Context (target, benchmark)
Quick Start To implement startup metrics framework:
Identify business model - SaaS, marketplace, consumer, B2B
Choose 5-7 core metrics - Based on stage and model
Establish tracking - Set up analytics and dashboards
Calculate unit economics - CAC, LTV, payback
Set targets - Use benchmarks for goals
Review regularly - Weekly for core metrics
Share with team - Align on goals and progress
Update investors - Monthly/quarterly reporting
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