Revenue & Growth Metrics Glossary

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Revenue Metrics

Growth Metrics

ACV (Annual Contract Value)

The average annualized revenue per customer contract, normalizing multi-year deals to show yearly value.

ARPU (Average Revenue Per User)

The average monthly or annual revenue generated per active user or account, calculated by dividing total revenue by total users.

Revenue Metrics

ARR (Annual Recurring Revenue)

The total value of recurring revenue normalized to a one-year period, calculated by multiplying MRR by 12.

Revenue Metrics

Annual Contract Value (ACV)

The annualized value of a customer contract, normalizing multi-year deals for comparison and trend analysis.

Revenue Metrics

Billings

The amount invoiced to customers in a period, representing cash that will be collected regardless of revenue recognition timing.

Revenue Metrics

Bookings

The total value of new contracts signed in a period, representing committed future revenue regardless of when it will be recognized.

Revenue Metrics

Contraction Revenue

Revenue lost when existing customers downgrade their plans or reduce usage, distinct from churn where customers leave entirely.

Growth Metrics

DAU/MAU Ratio

The ratio of daily active users to monthly active users, measuring how frequently users engage with a product.

Revenue Metrics

Deferred Revenue

Money received from customers for services not yet delivered, recorded as a liability until the service is provided and revenue can be recognized.

Revenue Metrics

Expansion Revenue

Additional revenue generated from existing customers through upsells, cross-sells, and increased usage beyond their original purchase.

Revenue Metrics

GRR (Gross Revenue Retention)

The percentage of recurring revenue retained from existing customers, excluding expansion revenue and only accounting for churn and contraction.

Growth Metrics

Lead Velocity Rate (LVR)

The month-over-month percentage growth in qualified leads, serving as a leading indicator of future revenue.

Revenue Metrics

MRR (Monthly Recurring Revenue)

The predictable revenue a subscription business expects to earn each month from active subscriptions.

Growth Metrics

Monthly Active Users (MAU)

The count of unique users who engaged with a product at least once in the past 30 days.

Revenue Metrics

NRR (Net Revenue Retention)

The percentage of recurring revenue retained from existing customers over a period, including expansion, contraction, and churn.

Revenue Metrics

Net New ARR

The change in Annual Recurring Revenue over a period, accounting for new customers, expansion, contraction, and churn.

Growth Metrics

North Star Metric

The single metric that best captures the core value a product delivers to customers, aligning company focus.

Growth Metrics

Pipeline Coverage

The ratio of total sales pipeline value to revenue target, indicating whether there are enough opportunities to hit quota.

Growth Metrics

Sales Cycle Length

The average time from first prospect contact to deal close, measuring how long the sales process takes.

Revenue Metrics

Seat Expansion

Growth in the number of paid users within existing customer accounts, a key driver of expansion revenue.

Growth Metrics

Session Duration

The average time users spend in your product per visit, measuring engagement depth.

Growth Metrics

Stickiness (DAU/MAU)

The ratio of daily to monthly active users, measuring how often users return and engage with your product.

Revenue Metrics

TCV (Total Contract Value)

The total revenue value of a customer contract over its full term, including all recurring and one-time fees.

Growth Metrics

Win Rate

The percentage of sales opportunities that convert to closed won deals, measuring sales effectiveness.