5 Metrics for Measuring Recurring Revenue - CFO Magazine


SaaS business models continue to increase in popularity in a variety of industries especially in Silicon Valley and the San Francisco Bay Area. According to recent research, over 90% of adults in the U.S. use online subscription services, spending over $850 in monthly subscription fees.

CFOs need to be careful in choosing and refining the right set of revenue metrics which accurately measure how a company is performing. Here is a short list of 5 possible metrics from a recent post on CFO Magazine:

1. Customer Lifetime Value (CLV)

2. Average Revenue Per User (ARPU)

3. Churn and Retention Rates

4. Customer Lifetime Value to Customer Acquisition Cost Ratio (CLV-to-CAC Ratio)

5. Annual Recurring Billings (ARB)

“Recurring revenue metrics are invaluable to a business and highly influential with investors and analysts. There are dozens of valuable metrics that can help CFOs boost recurring revenue results. These are just a starting point. Choose ones that fit the business model, pay attention to what they tell the company, and adjust accordingly, then repeat. Quarter and after quarter. Year after year.”

Read the full post

#saas #metrics

(415) 562-4490