Startup Metrics

  • Active users

  • Cash runway: how many months your company has before running out of cash?

    Formula:

    • Cash runway = Cash balance / monthly rate
    • Cash balance: how much money you have for your company
    • monthly rate: how much your company needs to keep running
  • Churn rate

  • Retention rate

  • Monthly recurring revenue projection(MRR projection): how much money you will have in the future annualized based on how much you are making now, the average monthly growth, and the net churn rate.

    Formula:
    MRR projection = (monthly actual revenue + average growth every month - net churn rate) * 12

  • North Star Metric: The measurement that's most predictive of a company's long-term success. It is a leading indicator of revenue, Reflects customer value, and Measures progress.

  • Total addressable market(TAM): The total addressable market(or total available market) is the revenue opportunity available for a product or service.

  • Serviceable Addressable Market(SAM): the portion of TAM that market that the company is looking to actually target with its specific product/service.

  • Serviceable obtainable market(SOM): shows how much of the SAM can be realistically captured by a business in the short/mid term.


Learning Material:


Retention rate

Churn rate