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Many people ask us for help understanding what all the SaaS metrics mean, why they’re useful and how they’re calculated. We thought we’d invest some time detailing the most important metrics for SaaS businesses into a two-page cheat sheet.
“UTM” stands for “Urchin tracking module.” Urchin Software Corporation was acquired by Google in 2005, and their software laid the groundwork for what we now know as Google Analytics.
Customer Lifetime Value (LTV) for SaaS businesses is perhaps one of the most difficult metrics to calculate. Use our free cheat sheet to get to a reliable estimate, and get a better picture of the health of your business.
At 19 I started a SaaS company in my dorm room and just sold it in February after my 25th birthday mainly due to luck and blind hard work. Over the companies life, we raised $2.5M in venture capital, drove $5M in sales (mainly by cold emailing potential partners), and grew our customer base to over 10,000 paying customers.
One of the most powerful levers for SaaS companies to master is payback period. Payback period is the number of months a company requires to payback its cost of customer acquisition. The median SaaS startup has a payback period of 15 months on a gross margin basis.
A cohort study or panel study is a form of longitudinal study used in medicine, social science and ecology. It is one type of study design and should be compared with a cross-sectional study.
Over the last few years I’ve helped quite a lot of SaaS startups to create or fine-tune their KPI dashboards. While every situation is a bit different there’s also a lot of overlap, which made me think that it would make sense to publish my template (not without polishing it a bit). I hope other SaaS startups will find it useful, and it will also make it easier for us to communicate what KPIs we’re looking for when we talk to SaaS entrepreneurs.
In case you haven’t started to think about your plan for 2017 yet, now’s the time. To help you a little bit with your planning, here are three little tools that you might find useful. If you’re a long-time reader of this blog, you may have seen them before.
Entrepreneurs need to ask the right questions: how can I measure and optimize each step of my funnel to grow quickly and expand my customer base? One simple answer is: AARRR.
aaS companies are handed dozens of shiny metric tools on a tray and told to measure things. It can be incredibly difficult to try to assess this collection of numbers and figure out where to begin.
Lately I’ve been talking to more entrepreneurs that have product/market fit and are working to find a repeatable customer acquisition process (see 5 Steps to Startup Success in 30 Words). Now, sales and marketing metrics become critical and it’s time to figure out what works.
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