Category — 01

Growth metrics. The numbers your board opens with.

Growth metrics are the simplest to compute and the easiest to flatter. Almost every founder I've watched fudge a number was fudging a growth number — usually by accident, sometimes on purpose, always with definitional games. This is the honest version of each of them.

The nine metrics

Nine numbers. Different stories.

Monthly Recurring Revenue
MRR
The compounding heartbeat of a SaaS business. What you'd bill this month if nothing changed. The simplest growth metric and the easiest one to mess up.
Coming soon
Annual Recurring Revenue
ARR
MRR × 12. The number on the board deck, the number on the term sheet, the number every investor anchors on. Same caveats as MRR, twelve times bigger.
Coming soon
Net New ARR
New − Lost
The honest version of growth. New ARR added, minus what churned and contracted. If this is negative, you're shrinking, no matter what the gross number looks like.
Coming soon
Growth Rate
% YoY
Year-over-year change in ARR. The single number that determines your valuation multiple. Calculated three different ways depending on who's asking.
Coming soon
Pipeline Coverage
3× / 4× / 5×
Total qualified pipeline divided by your quota. The leading indicator that tells you 60 days out whether you'll hit the quarter — or whether sales is about to ask for an exception.
Read the guide →
Win Rate
Won / Closed
The percentage of qualified opportunities you actually close. The cleanest read on whether your product, pricing, and positioning are working together.
Read the guide →
Sales Cycle Length
Days to close
How long it takes a qualified lead to become revenue. Drives your forecast accuracy, your cash position, and your rep capacity planning.
Read the guide →
Annual Contract Value
ACV
The average dollar value of a new deal, annualized. Tells you whether you're moving up-market or down, often before anyone notices.
Read the guide →
Sales Effectiveness
Three metrics
Quota Attainment, Productivity per Rep, and Ramp Time. The three metrics that tell you whether your sales motion is actually working — beyond the flattery of Win Rate.
Read the guide →

How these connect

MRR is the score. Pipeline coverage is the leading indicator.

These nine metrics form a chain, not a list. Pipeline becomes deals, deals become ACV, ACV becomes MRR, MRR becomes ARR, and the trailing change in ARR is your growth rate. Reading them in order tells you where the chain is breaking.

MRR and ARR are the same number expressed differently — MRR for operating, ARR for the boardroom. Pick one as your primary and stop mixing them in the same conversation. Most founders accidentally drift between the two and confuse their team.

Net New ARR is what you should actually be reviewing on Monday. Gross new ARR makes the new-logo team look good while churn quietly eats the back end. Net new is the honest scoreboard. If it's not on your weekly scorecard, your sales team is being graded on the wrong number.

Growth Rate is the metric the outside world judges you on. Every valuation multiple — every one — is anchored to your year-over-year growth rate. A 40% grower trades at twice the multiple of a 20% grower, even if both are the same size today.

Pipeline Coverage, Win Rate, Sales Cycle Length, and ACV are the four levers underneath all of it. If growth is slowing, one of these four is the culprit. Pipeline thinned out, you're winning fewer deals, deals are taking longer to close, or the deals you do close are smaller. Diagnose in that order — most pipeline-to-revenue problems are pipeline problems first.

You can grow ARR for a quarter on a thin pipeline by closing what you have faster. You can't do it for a year. Pipeline coverage is the metric that tells you the quarter after next is going to hurt, while you can still fix it.

Growth metrics belong on Monday's scorecard.

Upbeat pulls MRR, ARR, pipeline coverage, and the rest straight from your stack and grades them every week. Ten design partner spots open.

Email Nick directly