Startup Metrics Framework

Track the right metrics at the right stage.

Universal Metrics

Revenue

• MRR: Monthly Recurring Revenue
• ARR: Annual Recurring Revenue (MRR x 12)
• Net New MRR: New + Expansion - Churned - Contraction

Unit Economics

• CAC: Customer Acquisition Cost (total sales+marketing / new customers)
• LTV: Lifetime Value (ARPU x Gross Margin / Churn Rate)
• LTV:CAC Ratio: Target > 3.0
• CAC Payback: Months to recover CAC (target < 18 months)

Retention

• Logo Churn: % customers lost per period
• Revenue Churn: % MRR lost per period
• NDR (Net Dollar Retention): Measures expansion vs contraction (target > 110%)

Growth Efficiency

• Burn Multiple: Net Burn / Net New ARR (lower is better, <2 is good)
• Magic Number: Net New ARR / Sales & Marketing Spend (>0.75 is efficient)

Stage-Based Priorities

Pre-Seed

• Activation rate, retention curves, qualitative feedback

Seed

• MRR growth rate, CAC, initial unit economics

Series A

• LTV:CAC > 3.0, payback < 18 months, NDR > 110%, clear growth trajectory

Common Pitfalls

• Tracking vanity metrics (total signups, page views)
• Too many metrics (focus on 5-7 core)
• Ignoring unit economics
• Not segmenting by cohort