Startup Glossary
A complete library of terms, metrics, and calculations for your startup.
All Metrics
Annual Recurring Revenue (ARR)
Annual recurring revenue (ARR) is the amount of predictable revenue your business earns in a year from customers.
Average Revenue Per Account
Average revenue per account (ARPA) is the average monthly recurring revenue (MRR) per customer.
Average Revenue Per User (ARPU)
ARPU is the average monthly recurring revenue (MRR) per user.
Burn Rate
Burn rate is defined as the negative free cash flow (FCF) during the month.
CAC Payback
Customer Acquisition Cost (CAC) payback is the number of months it will take to recover the cost of acquiring a customer.
Cash Runway
Cash runway is the number of months until cash runs out.
Contraction MRR
Contraction MRR is the total reduction in MRR for a given month through downgrades or churns.
Cost of Goods Sold (COGS)
Cost of Goods Sold (COGS) refers to the direct costs associated with producing your product or service.
Cost Per Lead (CPL)
Your cost per lead is the amount of money you spend to acquire a new lead.
Customer Acquisition Cost (CAC)
Customer Acquisition Cost (CAC) is how much money you spend in sales and marketing to acquire one new customer.
Customer Churn
Customer churn is the percentage of customers your business lost in a set period of time.
Customer Lifetime Value (CLV)
Customer lifetime value (LTV) is how much revenue one customer generates for your business over time.