SaaS KPI Examples

KPIs are metrics that correlate with business performance. SaaS, like most types of business, should involve a data lead Leadership Team.
Departments like Sales, Marketing and Customer Success need to be data driven and aligned to optimise growth. Part of the skill of growing a SaaS company is knowing what to measure and focus your efforts on. Here are SaaS KPI examples that help you do exactly that.

Easy To Understand SaaS KPI Examples

3 Checks To Do When Reviewing These SaaS KPIs

Below there are KPIs for SaaS teams. When looking through them have a thought for:

Are you currently tracking this?
Should you be tracking this?
Should this KPI be in an OKR?

These are KPIs you’re likely to find in Board Packs, Fundraising, and Company OKRs.

What drives these KPIs is the Acquisition and Retention efforts of Marketing, Sales and Customer Success, and the
Product and Engineering efforts needed to deliver a high value software solution to a valuable problem.

In the world of SaaS these KPIs are often referred to as SaaS Metrics not SaaS KPIs, although they are exactly the same.
One of the goto reference sources for SaaS Metrics is this article from David Skok.

KPIs For SaaS

Number Of Customers / Accounts

It’s an obvious one but you want to increase the total number of customers / accounts you have.
It works independently and as part of calculations like ARPA.

Monthly Recurring Revenue (MRR)

SaaS is all about increasing subscription Billings and that means Monthly Recurring Revenue or MRR.
MRR is all of your recurring revenue normalized to a monthly amount.

MRR Growth Rate

How fast is your MRR growing? The answer is expresses as % Growth Rate of MRR.
Increasing or accelerating you MRR Growth is the name of the game. This can be from New MRR and Expansion Sales.
Reducing Churn is critical as well.

Lifetime Value Of Customer (LTV)

The Lifetime Value or LTV of a customer is the expected lifetime revenue from a
new customer signed in a time period.

This is an important Marketing KPI because it impacts that you can spend on acquiring a customer,
which in turn impacts which channels you can use and what proportion of market demand you can market to.
This means that if you’ve a relatively high LTV you job is easier than a competitor with a lower LTV.

But like NPS, LTV is a Company and Team KPI and actually impacts other teams like Product and Customer Service.
This means that when it’s set as a Goal it’s often a Collaboration across teams or if it’s an issue could even
have a multi-functional squad assigned.

Cost Of Acquiring A Customer (CAC)

Your Costs Of Acquiring A Customer or CAC is simply that, i.e. the
amount it cost to acquire a customer during the period.

It’s a measure of how efficiently you can use your Marketing Spend to acquire a customer.
Note that where the customer journey is long using the costs in the same month might not be optimal.

You obviously want your LTV to me much better and higher than your CAC, otherwise you’re losing money with every sale.
This is expresses as the LTV : CAC ratio usually.

Annual Recurring Revenue

ARR is the yearly version of MRR. It assumes there is no churn, new customers or growth. It’s literally MRR x 12. 

Net MRR Churn %

The Net MRR Churn which includes Expansion MRR expressed as a % of the starting MRR for the period.
If your Net MRR Churn is above 2% per month you have an issue. The median SAAS business loses about 10%
of its revenue to churn each year and that works out to about 0.83% revenue churn a month (Tomasz Tunguz).
Bessemer Venture Partners say that an acceptable churn rate is in the 5 – 7% range annually.

Average Revenue Per Account (ARPA)

ARPA is the average MRR per account. You want to increase this both for new deals and through expansion sales / upgrades.


The money that is collected in the period and will be different from revenue due to timing.


Revenue happens when the service is actually provided. To keep this simple it’s been assumed
all the billings have been recognized in the same month, this is often not the case, and in the case of
annual upfront payments we could only recognize 1/12 in any month. Also, real historic account values
have not been used and instead new account ARPA has been used.

Cost of Goods Sold (COGS)

There are no Generally Accepted Accounting Principles (GAAP) rules on the type of costs that
are included in Cost of Goods Sold (COGS). It’s recommended you do not include: sales commissions,
allocated overhead charges, customer success costs associated with cross-selling/up-selling, product
development costs, third-party software use in-house for operations but not packaged in your product.

Gross Profit

This is the Revenue less the Cost of Goods Sold.

Gross Margin %

For SaaS companies this is often targeted at over 80%.

Total Operating Expenses

Typically includes: Sales & Marketing, Research & Development, General & Administrative, Professional Services.


EBITDA (Earnings before interest, taxes, depreciation and amortization is a measure of a company’s operating efficiency.


EBITDA as a % of Gross Margin / Gross Profit.

Rule of 40

Your Y-on-Y MRR Growth rate + your Profit should add up to 40%. For maturing SaaS companies this is a
good metric, but for early stage companies, whose Gross Profit metric may exceed 100% or more,
founders should focus more on the unit economics.

SaaS Quick Ratio

A simple way to evaluate the growth efficiency of early-stage SaaS startups. A rule of thumb is that high-growth
companies should aim for a Quick Ratio of 4 (meaning that for every dollar they lose in a month they add 4).

Revenue Per Employee

The best companies are able to maintain or even accelerate their revenue per employee. It indicates that the company is
achieving economies of scale and understand the increasing or decreasing efficiency of the business.

Improve KPIs with Dashboards, Goals and Operational Alignment

If you want to improve KPIs, creating KPI Dashboards is the natural next step – especially in an agile working environment.

These KPIs can and should also be used inside Key Results as part of setting goals using OKRs.
Remember that when setting your targets to be ambitious. Goals are deliberately designed to be hard to achieve,
as this is what drives greater creativity, efficiency and effectiveness.

The data can be gathered from integrations with Salesforce and other Sales and
Marketing technologies you’re using, or update KPIs manually.

Inside ZOKRI you can create Dashboards and create OKRs from KPIs. You can also create and manage Initiatives
targeting these KPIs and OKRs in ZOKRI or by connecting task managers like Trello and Asana.

Measuring KPIs that matters, setting goals and aligning and optimizing your operations is

the key to performance growth and is what ZOKRI is designed to do.