The 5 SaaS Metrics Driving Investor Valuations in FY24

Most people suck at SaaS metrics

But if you avoid these 5 common mistakes, I guarantee you won't.

Ignoring ARR Growth

→ The year-on-year growth in annual recurring revenue.

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↳ Monitor your ARR meticulously.

↳ Communicate growth to investors.

Neglecting GRR

→ Indicates revenue retained from customers.

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↳ Keep a close eye on churn.

↳ Strategize for customer retention.

Overlooking NRR

→ Reflects the difference between revenue generated and costs.

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↳ Aim to retain and expand revenue from existing customers.

↳ Focus on profitability and scalability.

Misunderstanding Gross Margin

→ Represents the percentage of revenue a company retains after COGS.

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↳ Pursue efficient operations.

↳ Strive for high gross margins for profitability.

Not Applying the Rule of 40

→ The combination of a company's revenue growth and profit margin.

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↳ Balance growth and profitability.

↳ Aim for a Rule of 40 score above 40%.

These key SaaS metrics aren’t just about impressing investors.

You should know your company’s health, scalability, and potential for profit.

Do you see people making mistakes with SaaS metrics? (Yes/No)

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