Def: it measures the rate at which a startup is spending its cash reserves. Formula: Cash spent - cash generated
Desc: A positive net burn rate indicates that the startup is spending more cash than it is generating, while a negative net burn rate indicates that it is generating more cash than it is spending.
Net Revenue Retention
Def: Net revenue retention is a SaaS metric that measures the recurring revenue generated from existing customers over a set period. Formula: (MRR at the beginning of the period + Business expansion revenue – cancelled MRR – Downgraded MRR) / MRR at the beginning of the period} * 100.
Desc: For startups, net revenue retention is important because it measures how well a company is retaining and growing its existing customer base.
Number of customers
Def: A count of unique customers where they have placed orders
Desc: A growing customer base typically means that a business is gaining traction and increasing its revenue.
Number of new customers
Def: Count of unique customers where they have placed orders in the specified period
Desc: Tracking the number of new customers allows startups to understand their customer acquisition efforts and identify trends in customer behaviour.
Number of new subscriptions
Def: The total count of individuals or businesses that have signed up for a recurring service or product during a specific period of time.
Desc: This metric is important for startups because it helps them to understand how well they are doing in acquiring new customers and growing the business.
Number of orders
Def: The number of orders for a specific period.
Desc: It indicates the demand for their products/services
Number of subscriptions
Def: The total count of individuals or businesses that have signed up for a recurring service or product provided by a company.
Desc: For startups, the number of subscriptions is an important metric as it indicates the number of customers that have committed to using the company's service or product on a regular basis.
Number of transactions
Def: The total count of sales or purchases made by a company during a specific period of time, usually a month, quarter or a year.
Desc: This gives founders an understanding of how many times their products or services have been purchased by customers, and how active the business is.
Def: This measures the amount of time it takes for an investment or project to recoup its initial cost. Formula: initial cost of the investment or project / annual cash flow generated by the investment or project.
Desc: For example, if a startup invests $100,000 in a new project and the annual cash flow generated by that project is $25,000, the payback period would be 4 years (100,000 / 25,000 = 4).
Def: The Quick Ratio measures a startup's ability to meet its short-term liabilities using only its most liquid assets. Formula: current assets - inventory – prepaid expenses) / current liabilities
Desc: It is important for startups as it gives an idea of the startup's liquidity and ability to meet short-term obligations in case of emergencies. A ratio greater than 1.0 is generally seen as a positive sign.
Def: combined value of goods and services a business delivers to its customers during a specific reporting period.
Desc: Allows startups to understand their revenue growth and identify trends in customer behaviour.
Def: Working capital measures a company's ability to meet its short-term obligations. Formula: current assets – current liabilities
Desc: Without sufficient working capital, a startup may struggle to meet its obligations.
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