Keeping track of important SaaS metrics requires some upfront investment in data collection and analytics, but the results are obvious. Armed with the right metrics, you can make better decisions.
In this post, we’re not only covering the top metrics, we’re also showing you what you can learn from them and how to apply them.
Here are 25 SaaS metrics every SaaS company should measure:
Average customer lifetime value (LTV)
Customer acquisition cost (CAC)
Time to recover CAC
LTV:CAC ratio
Monthly recurring revenue (MRR)
Annual recurring revenue (ARR)
Customer churn rate
Revenue churn rate
New signups
Conversion rate to paying customer
Active users
Time to “Aha” moment
Success rate of “Aha” moment
Net Promoter Score (NPS)
Number of support tickets, by severity or type
Product-qualified leads (PQLs)
Marketing-qualified leads (MQLs)
Sales closing ratio
Organic to paid traffic ratio
User engagement score
Runway
Expansion revenue
Burn rate
Customer retention cost (CRC)
Net revenue retention (NRR)
How to track your SaaS metrics
Klipfolio is one of the best KPI and metrics dashboards for SaaS companies. It comes preloaded with dashboards that are helpful for SaaS, and their marketing and customer support teams have a lot of resources for SaaS customers.
You could also use a few different products instead of just one SaaS metrics dashboard. You might need one tool for your marketing and product analytics, and another for tracking revenue and expenses.
1. Average customer lifetime value (LTV)
Your LTV is how much you earn from a customer over the lifetime of your relationship with them. It reflects the long-term value of each user and helps you understand how much you can afford to spend on acquiring new ones.
How to measure it
To calculate LTV, multiply your average monthly revenue per customer by the average number of months they stay subscribed. For greater accuracy, especially in financial planning, some teams also multiply by gross margin:
LTV = (Average Monthly Revenue per Customer × Average Customer Lifespan in Months) × Gross Margin
While it’s tempting to project revenue indefinitely from non-churned users, you need to define a realistic customer lifespan. Many SaaS companies estimate this at 4 to 5 years.
What it can tell you
LTV is a foundational metric that helps you evaluate customer profitability and make smarter decisions in budgeting, marketing, and customer success. It becomes even more powerful when used alongside CAC or churn metrics, and can influence pricing strategy, retention programs, and investor conversations.
2. Customer acquisition cost (CAC)
This metric measures how much it costs to acquire a new customer. Instead of evaluating individual marketing campaigns in isolation, CAC takes into account the full scope of your sales and marketing spend. This includes salaries, ad spend, software, contractors, and any other acquisition-related costs.
How to measure it
To calculate CAC, divide your total sales and marketing spend over a given period by the number of new customers acquired in that same timeframe:
CAC = Total Sales & Marketing Cost ÷ Number of New Customers
Be sure to include the full cost—campaigns that failed to convert still contribute to your overall spend. You can also calculate CAC by channel or segment (e.g., CAC for enterprise vs. SMB) for more actionable insights.
What it can tell you
CAC reveals the true cost of acquiring a customer. It helps you assess marketing efficiency and identify high-performing channels. Tracking it over time shows whether your acquisition efforts are becoming more efficient as you scale. Later, we’ll look at the LTV:CAC ratio, which helps you understand whether your acquisition costs are sustainable relative to the value each customer brings in.
3. Time to recover CAC
The time to recover CAC is the average number of months it takes to earn back the cost of acquiring a customer. In other words, it’s your payback period—the point at which revenue from a customer surpasses your acquisition investment.
How to measure it
To calculate this, divide your customer acquisition cost (CAC) by the average gross margin per customer per month:
Time to Recover CAC = CAC ÷ Monthly Gross Margin per Customer
For example, if you spend $1,000 to acquire a customer and their subscription generates $50 in gross margin each month, it will take 20 months to recover your CAC.
What it can tell you
This metric is critical for understanding your cash flow cycle. Most SaaS companies aim to recover CAC within 5 to 7 months. Fast-growing or highly efficient businesses may do it in under 6 months. If it takes longer than 12 months, it could signal that your pricing is too low, your acquisition costs are too high, or your onboarding isn't converting value fast enough. Tracking this over time helps balance growth against financial sustainability.
4. LTV:CAC ratio
The ratio of your LTV to CAC shows how efficiently your business turns customer acquisition costs into long-term revenue. For SaaS companies, which often face high acquisition costs and delayed payback periods, this ratio is especially critical.
How to measure it
If you’ve already calculated LTV and CAC, the formula is simple:
LTV:CAC Ratio = LTV ÷ CAC
For example, if your average customer lifetime value is $1,200 and your CAC is $250, the ratio would be 4.8:1.
What it can tell you
A healthy SaaS business generally aims for a ratio of 3:1—earning $3 for every $1 spent acquiring customers. If your ratio is much lower, you may be overspending to acquire users or not retaining them long enough to recover the investment. If your ratio is much higher (5:1 or 6:1), it could be a sign that you're under-investing in growth, and scaling your sales and marketing spend may accelerate revenue.
This ratio helps balance long-term value against short-term cost and is especially important when shifting from growth mode to profitability. Let me know when you’re ready to move forward.
5. Monthly recurring revenue (MRR)
Monthly Recurring Revenue (MRR) is one of the most essential SaaS metrics. It represents the predictable revenue your business earns each month from active subscriptions—excluding one-time charges or non-recurring purchases.
How to measure it
MRR is calculated by multiplying the number of active paying users by their average monthly subscription price:
MRR = Number of Paying Customers × Average Monthly Revenue per Customer
For businesses with annual subscriptions, divide the annual payment by 12 to get the monthly equivalent. Do not include one-time setup fees, usage-based charges, or professional services in your MRR.
What it can tell you
MRR is a clear indicator of revenue health and growth over time. Tracking MRR month-over-month helps you identify revenue trends, measure the impact of marketing or product changes, and project future income. It’s also a foundational metric used in calculating churn, expansion revenue, CAC payback, and overall growth performance.
6. Annual recurring revenue (ARR)
ARR reflects the total amount of predictable revenue your SaaS business earns annually from subscriptions. It provides a high-level view of recurring revenue performance and is especially important when raising capital or pursuing revenue-based loans.
How to measure it
There are two ways to calculate ARR, depending on your business model.
For more accurate forecasting:
ARR = (Subscription Revenue + Recurring Upgrade Revenue) – Revenue Lost from Downgrades and Cancellations
If your pricing is flat and straightforward, you can use:
ARR = MRR × 12
Only include recurring revenue—exclude one-time setup fees, usage-based billing, and professional services. For multi-year contracts, divide the full contract value by the number of years.
What it can tell you
ARR is one of the clearest growth metrics for SaaS, giving you a big-picture view of how predictable and scalable your recurring revenue really is. It’s commonly used by investors and lenders to evaluate business viability and growth potential. Tracking ARR helps you benchmark year-over-year progress, measure the impact of churn and upsells, and make more informed decisions about product development, hiring, and expansion.
7. Customer churn rate
Customer churn rate measures the percentage of customers who cancel or fail to renew within a given period—most often monthly. It’s a core retention metric that signals customer satisfaction and long-term viability.
How to measure it
To calculate churn rate, divide the number of customers lost during a time period by the number of customers at the start of that period:
Customer Churn Rate = (Customers Lost ÷ Customers at Start of Period) × 100
Depending on your business model, you may calculate churn globally or break it down by plan, persona, or cohort to gain more actionable insights.
What it can tell you
Churn is unavoidable, but high or rising churn can quickly derail growth. Tracking churn over time helps you identify issues with onboarding, product experience, or customer support. A churn rate above 5–7% monthly is usually a red flag in SaaS, though benchmarks vary based on pricing and market. Consistent measurement helps you react quickly to changes and uncover opportunities to improve retention across the customer lifecycle.
8. Revenue churn rate
While customer churn rate tracks the number of users lost, revenue churn rate measures the actual revenue lost from those departures. It helps you understand the financial impact of churn, especially if you serve customers on multiple pricing tiers.
How to measure it
There are two primary ways to calculate revenue churn:
Gross Revenue Churn Rate = (MRR Lost from Churned Customers ÷ MRR at Start of Month) × 100
This version ignores upgrades or expansion revenue.
Net Revenue Churn Rate = [(MRR Lost – Expansion MRR) ÷ MRR at Start of Month] × 100
This accounts for additional revenue from existing customers, which can offset churn.
If you offer variable pricing tiers, you may need to pull from billing or subscription data rather than user counts to calculate these figures accurately.
What it can tell you
Revenue churn provides a more accurate view of business risk than customer churn alone. Losing one high-value customer may impact revenue more than losing five low-value ones. High revenue churn—especially if net churn is above zero—may signal poor product fit for your top-paying users. If your net churn is negative, that’s a strong sign of growth driven by upsells, cross-sells, or tier upgrades from retained customers.
9. New signups
New signups track how many users register for your product during a specific time period—daily, weekly, monthly, or quarterly. This includes trial users, freemium accounts, or direct paid signups, depending on your model.
How to measure it
Whether you’ve built your SaaS with a trial and invoicing platform like Zuora, or custom-built your subscription infrastructure, you should be able to pull signup counts through your analytics or billing system. Segmenting by source (paid, organic, referral) adds deeper insight into acquisition performance.
What it can tell you
Tracking signups over time shows how your acquisition efforts are performing at the top of the funnel. This is one of the most direct acquisition metrics for evaluating early-stage marketing performance. Surges may point to successful marketing or PR campaigns, while dips could highlight friction in messaging or onboarding. Signups also help you evaluate campaign ROI and identify the channels bringing in the most engaged users—especially when combined with conversion and retention metrics.
10. Conversion rate to paying customer
This metric tracks the percentage of users who start as free trial or freemium users and ultimately become paying customers. It’s a key indicator of how effectively your product, onboarding, and pricing work together to deliver perceived value.
How to measure it
Track the number of users who start on a free plan or trial and convert to a paid subscription within a set period—typically within the first 30 days. To get the most accurate conversion rate, follow user-level data across signup types. Don’t just divide total signups by new paying customers, as some users may bypass free plans and purchase immediately.
What it can tell you
This is one of the most revealing SaaS metrics. A low conversion rate may indicate friction in your onboarding flow, unclear value propositions, or weak feature exposure during the trial period. Monitoring this rate closely helps evaluate onboarding experiments, trial length, product-led growth efforts, and pricing changes. A strong conversion rate is a sign that your product resonates—and that users are seeing value quickly.
11. Active users
Active users represent the number of people consistently engaging with your product during a given timeframe. It's a fundamental engagement metric and a strong indicator of product usage and customer health.
How to measure it
This depends on your product’s expected usage frequency. Most SaaS companies track one or more of the following:
DAU (Daily Active Users) – for tools meant to be used daily, like chat or productivity platforms
WAU (Weekly Active Users) – common for collaborative or analytics tools
MAU (Monthly Active Users) – for products with more periodic usage, like reporting or billing platforms
Define what “active” means based on user actions—not just logins. For example, opening the app may not qualify, but completing a key task might.
What it can tell you
Active user metrics show how well your product is driving ongoing value. Comparing active users to total accounts helps surface disengaged customers who may be at risk of churn. Monitoring how active usage trends alongside new signups reveals the quality of your onboarding and product-market fit. If active usage isn’t keeping pace with growth, you're likely acquiring low-fit users—or losing them during activation. This metric is key for shaping your SaaS engagement strategy and retention efforts.
12. Time to “Aha” moment
The “Aha” moment is the point in the onboarding journey when a user first experiences the core value of your product. Measuring how long it takes to get there helps you understand how intuitive and effective your initial experience is.
How to measure it
First, define the “Aha” moment based on meaningful product interaction—not just logging in. For a design tool, it might be creating and saving a project; for a collaboration tool, it could be inviting a teammate. Then, use product analytics to measure the average time between account creation and completion of that action.
What it can tell you
A long time to value may signal onboarding friction, poor UX, or an unclear user journey. If users don’t reach the “Aha” moment quickly, they’re more likely to churn. Monitoring this metric helps you test and improve onboarding flows and ensures your key value proposition is front and center early on.
13. Success rate of “Aha” moment
This metric tracks the percentage of new users who reach the “Aha” moment—the first point at which they experience meaningful value from your product. It’s a key way to measure the effectiveness of your onboarding experience.
How to measure it
Once your “Aha” moment is clearly defined (such as sharing a file, inviting a teammate, or creating a project), calculate:
Success Rate = (Number of Users Who Complete the Aha Action ÷ Total New Signups) × 100
Track this ratio over time and segment it by traffic source, onboarding path, or device type for deeper insights.
What it can tell you
This metric is one of the clearest indicators of onboarding success. If a low percentage of users reach the “Aha” moment, it may point to issues with UX, onboarding flows, or even an unclear value proposition. Improving this rate typically leads to stronger engagement and higher long-term retention.
14. Net Promoter Score (NPS)
NPS measures how likely your users are to recommend your product to others. It’s one of the simplest ways to track overall customer satisfaction and loyalty.
How to measure it
You can use a tool like Hotjar to survey users in-app or via email. Customers are asked to rate, on a scale from 0 to 10, how likely they are to recommend your product. Respondents are then grouped as follows:
Promoters (9–10)
Passives (7–8)
Detractors (0–6)
NPS = % of Promoters – % of Detractors
What it can tell you
NPS helps you monitor customer sentiment and quickly identify shifts tied to product updates, pricing changes, or support issues. A declining NPS can signal growing dissatisfaction or feature gaps. Use qualitative feedback collected with NPS to guide product improvements and strengthen retention. When used consistently, it can be an early warning system for churn and a tool for prioritizing roadmap decisions.
15. Number of support tickets, by severity or type
Tracking support ticket volume helps you understand where users are struggling—but breaking those tickets down by category or severity provides far more actionable insight.
How to measure it
Use your helpdesk system (like Zendesk, Intercom, or Help Scout) to tag or categorize tickets based on issue type (e.g., bugs, billing, UX confusion) or severity . Work with your support team to maintain consistent tagging so you can run quarterly reports that go beyond total ticket volume.
What it can tell you
This metric reveals recurring pain points and can alert you to usability issues, bugs, or gaps in user education. A spike in critical or high-severity tickets may require a product fix, while an increase in billing or onboarding confusion could point to poor UI or messaging. Tracking support data this way not only improves customer experience, but also helps prioritize product improvements that reduce churn.
16. Product-qualified leads (PQLs)
A product-qualified lead (PQL) is a user who has experienced meaningful value in your product and shown clear intent to upgrade or purchase. Instead of qualifying leads based on form fills or sales conversations, PQLs are identified based on behavior inside the product.
How to measure it
Start by defining the product actions that indicate strong buying intent. Completing a core feature (like creating a report), hitting usage limits (like running out of free seats), or repeated engagement over time are all possible actions you could include. Then track how many users hit those triggers monthly or quarterly. Use analytics or customer data platforms to flag these leads automatically for follow-up.
What it can tell you
PQLs are essential for optimizing product-led growth strategies. Tracking them helps align your product, marketing, and sales teams around high-intent users. A healthy ratio of PQLs to new signups indicates you’re attracting the right users—and activating them successfully. Use this metric to benchmark lead quality, refine in-app marketing, and focus sales efforts where they’re most likely to convert.
17. Marketing-qualified leads (MQLs)
Marketing-qualified leads (MQLs) are contacts who have shown interest through marketing touchpoints and meet agreed-upon criteria that suggest they’re ready to engage with your sales team. In SaaS, this often includes behaviors like downloading gated content, visiting pricing pages, or attending webinars.
How to measure it
Sales and marketing teams should jointly define what constitutes an MQL. This could be based on behavior, demographics, or firmographics. Use marketing automation or CRM platforms to apply scoring or tagging rules, then track how many MQLs are generated each month or quarter.
What it can tell you
Tracking MQLs helps you evaluate the quality and effectiveness of your marketing efforts. A drop in MQLs may indicate problems with lead sources, messaging, or campaign targeting, while a spike may show strong alignment with your target audience. This metric is essential for measuring marketing’s contribution to pipeline and identifying which tactics are driving scalable growth.
18. Sales closing ratio
If you have a sales-assisted model, tracking your sales closing ratio is essential. It tells you how many qualified leads ultimately convert into paying customers and helps you understand how effective your sales process really is.
How to measure it
Calculate your closing ratio by dividing the number of deals won by the total number of qualified leads handed to the sales team during a given period:
Closing Ratio = Closed-Won Deals ÷ Sales-Qualified Leads
While individual reps may review pipeline performance in 1:1s, it’s important to track this metric across the entire team to evaluate your broader sales effectiveness.
What it can tell you
The sales closing ratio is one of the most revealing SaaS sales metrics. It not only reflects sales team performance, but also how well your product resonates with qualified leads.. If it’s trending low, it could mean your sales messaging isn’t resonating—or that there’s friction in the product itself. Objections raised during sales calls can reveal gaps in functionality, onboarding clarity, or pricing expectations. Tracking this metric over time gives you a window into how aligned your offering is with the needs of your target market.
19. Organic to paid traffic ratio
This ratio compares how much of your traffic is earned organically versus how much is driven by paid campaigns. It’s one of the most straightforward SaaS marketing metrics you can track, and one of the most telling.
How to measure it
Use tools like Google Analytics to monitor traffic sources. Then calculate:
Organic to Paid Traffic Ratio = Organic Sessions ÷ Paid Sessions
You can also track this as a percentage of total traffic to see how much of your reach is sustainable versus budget-dependent. Accurately segmenting conversions by source requires server-side attribution. Tools like mbuzz capture 30-40% more touchpoint data than client-side analytics by resolving sessions server-side, giving you a cleaner picture of which channels actually drive signups.
What it can tell you
Early-stage SaaS companies often rely on paid channels for traction, but over time, a growing share of organic traffic signals strong brand momentum and a healthy long-term strategy. If your ratio is consistently skewed toward paid, it may be time to lean into SEO, content, or referral strategies. This metric is a cornerstone of SaaS marketing metrics because it helps you evaluate short-term performance against long-term growth potential.
20. User engagement score
A user engagement score helps you quantify how actively users are interacting with your product. Unlike raw activity metrics, this score is customized to reflect what meaningful engagement looks like in your SaaS product.
How to measure it
Start by defining what actions signal value in your platform. This might be logins, feature usage, messages sent, dashboards created, or integrations enabled. Assign each action a weighted score based on its importance. Then, create a formula that adds up those actions over time and generates a score for each user. Exclude inactive users, and calculate an average across your active user base.
What it can tell you
This is one of the more flexible but powerful SaaS engagement metrics. A rising engagement score after a feature release suggests good adoption. A dip could indicate usability issues, bugs, or misalignment with user needs. Over time, this metric helps you spot patterns, validate roadmap decisions, and surface both power users and disengaged ones who may be at risk of churn.
21. Runway
Runway tells you how many months your SaaS business can continue operating at its current burn rate before running out of cash. It’s a financial planning tool and a critical decision-making metric for early-stage and growth-focused companies.
How to measure it
The basic formula is:
Runway = Current Cash ÷ Net Monthly Burn
Your burn rate is the amount of money you’re losing each month (expenses minus revenue). For accuracy, use an average burn rate over the past few months, especially if your costs fluctuate.
What it can tell you
Runway gives you a hard deadline. If you’re fundraising, it tells you how long you have to close your next round. If you’re bootstrapping, it tells you how much time you have to hit profitability or slow your spending. SaaS leaders use runway to set hiring plans, adjust marketing spend, and evaluate product investment timing. Even if your growth is strong, low runway limits your ability to maneuver. This metric keeps that reality front and center.
22. Expansion revenue
Expansion revenue is the additional recurring revenue you earn from existing customers through upgrades, add-ons, or increased usage. It’s a core lever for growing revenue without acquiring new customers.
How to measure it
Track the recurring revenue gained from upsells (e.g., plan upgrades), cross-sells (e.g., feature add-ons), or increased usage (e.g., seats, data, transactions) over a specific period. This should exclude renewals or reactivations and focus only on net new revenue from accounts already in your system.
You can also express expansion revenue as a percentage of total revenue growth or use it to calculate Net Revenue Retention (NRR).
What it can tell you
Expansion revenue is one of the strongest signals of product success and customer satisfaction. It shows that users are seeing enough value to invest more over time. A healthy expansion engine improves NRR, offsets churn, and helps your SaaS business grow more efficiently. Tracking this metric can also reveal which features or usage tiers are driving growth and where to double down.
23. Burn rate
Burn rate tracks how much money your company is spending each month beyond what it’s earning. For SaaS businesses—especially those in growth mode—it’s a key financial metric that shows how quickly you're consuming cash reserves.
How to measure it
To calculate net burn rate, subtract your monthly revenue from your monthly expenses:
Burn Rate = Total Monthly Expenses – Total Monthly Revenue
If you want to assess pure spending (without accounting for revenue), you can calculate gross burn rate as your total monthly operating costs.
It’s best to average this over several months to smooth out anomalies and get a more accurate picture.
What it can tell you
Burn rate is your financial heartbeat and is one of the most critical economic metrics in SaaS. It reflects how aggressively you're spending compared to what you’re bringing in—and how sustainable that pace is.A high burn rate shortens your runway and limits flexibility. A low or shrinking burn rate gives you more time to grow, pivot, or prepare for funding. Tracking this over time can help you make smarter decisions about hiring, R&D investments, marketing spend, and pricing strategies. For founders, this is the number that tells you how bold (or cautious) you can afford to be.
24. Customer retention cost (CRC)
Customer retention cost (CRC) measures how much you're spending to keep existing customers engaged, satisfied, and subscribed. While acquisition gets more attention, retention spend often plays a bigger role in long-term profitability.
How to measure it
Add up all costs related to retaining customers over a set time period. These costs might include:
Customer success team salaries
Support costs
Retention-focused marketing (email campaigns, loyalty programs)
Community management or user groups
Education initiatives (webinars, training content)
Then divide that total by the number of existing customers retained in that same period:
CRC = Total Retention Costs ÷ Customers Retained
What it can tell you
CRC helps you understand the efficiency of your post-sale efforts. If your cost to retain customers is rising faster than the value those customers generate, you may need to rework your support model or improve onboarding. On the other hand, a stable or declining CRC can signal that your product is becoming more self-sustaining. This metric pairs well with LTV and churn to give you a full picture of your customer economics.
25. Net revenue retention (NRR)
Net Revenue Retention (NRR) shows how much of your existing revenue you retain over time, after accounting for upgrades, downgrades, and churn. It’s one of the most important SaaS financial metrics because it measures true customer value growth.
How to measure it
Start with the total recurring revenue from your existing customers at the beginning of a period. Then factor in:
Expansion revenue (from upgrades or add-ons)
Revenue lost from downgrades
Revenue lost from churned customers
Use this formula:
NRR = [(Starting Revenue + Expansion Revenue – Downgrades – Churned Revenue) ÷ Starting Revenue] × 100
Only include revenue from customers who were already active at the beginning of the period. Exclude any new customers.
What it can tell you
NRR reveals whether your current customer base is growing or shrinking in value. An NRR above 100% means your expansion revenue more than offsets losses, and your product is gaining traction with users over time. This is a strong signal of product-market fit, customer satisfaction, and long-term growth potential. SaaS investors watch this number closely—and so should you.
Leveraging your metrics to meet your goals
You can’t optimize for high growth and high profitability at the same time. Every SaaS company has to make trade-offs based on its stage, market, and strategy. The key is knowing which metrics to prioritize depending on your goal, and tracking the rest so you’re ready to shift when the time comes.
Here are the list of metrics grouped by objectives.
Growth-focused
When you're in acquisition mode, you're aiming to grow fast—even if that means burning more cash upfront.
Key metrics:
Customer acquisition cost (CAC)
LTV:CAC ratio
New signups
Conversion rate to paying customer
MQLs
PQLs
Organic to paid traffic ratio
Sales closing ratio
Expansion revenue
Retention-focused
Focusing on keeping users means investing in product experience, support, and customer success.
Key metrics:
Customer churn rate
Revenue churn rate
Net Promoter Score (NPS)
Number of support tickets, by severity or type
Time to “Aha” moment
Success rate of “Aha” moment
User engagement score
Feature adoption rate
Net revenue retention (NRR)
Customer retention cost (CRC)
Profitability-focused
When extending runway or working toward sustainability, efficiency becomes the priority.
Key metrics:
Monthly recurring revenue (MRR)
Annual recurring revenue (ARR)
Time to recover CAC
Burn rate
Runway
Average customer lifetime value (LTV)
Data is power. The smartest SaaS teams track metrics to guide decisions. You may only act on a handful of KPIs right now, but building a culture of consistent measurement gives you options. When your goals shift, your data will already be there, ready to point the way forward.