Startup Glossary

A complete library of terms, metrics, and calculations for your startup.

All Metrics

Contraction MRR

Contraction MRR is the total reduction in MRR for a given month through downgrades or churns.

Revenue Per Employee

Revenue per employee calculates the amount of revenue that each employee earns for the business.

Trailing Twelve Months Revenue (TTM)

TTM revenue is the amount of revenue a company generates within the last twelve months. 

Annual Recurring Revenue (ARR)

Annual recurring revenue (ARR) is the amount of predictable revenue your business earns in a year from customers.

Revenue Run Rate

Revenue run rate is a projection of your annual revenue based on revenue generated in a previous period.

Marketing Qualified Lead (MQL)

MQLs are leads vetted and qualified by the marketing team—whether that is done manually or automatically.

Sales Qualified Leads (SQL)

An SQL is a lead that has been vetted and is highly interested in purchasing your product or service.

Downgrade MRR

Downgrade MRR is the amount of MRR lost due to customers paying less in subscription costs than the previous month.

Customer Retention Cost

Customer Retention Cost (CRC) is the total cost of retaining a customer.

Average Revenue Per User (ARPU)

ARPU is the average monthly recurring revenue (MRR) per user.

Revenue Retention

Revenue retention is the percentage of your revenue that is retained over a given period of time.

Negative Churn

Negative churn is when new revenue from existing customers (expansion MRR) is greater than the amount of revenue you lost from cancellations and downgrades (churned MRR).