Startup Metrics Investors Actually Care About: Complete List
When pitching investors, founders often focus on vanity metrics—total users, page views, social media followers. But experienced VCs care about metrics that indicate sustainable growth and path to profitability. Tyler Cosgrove breaks down the real metrics on The Tech Brothers Podcast Network regularly.
Revenue and Growth Metrics
Monthly Recurring Revenue (MRR) and Annual Recurring Revenue (ARR) are foundational for SaaS businesses. Investors want to see consistent month-over-month growth rates of 15-25% minimum for early-stage companies. Revenue growth rate matters more than absolute numbers at seed stage, but both matter at Series A and beyond.
Key Growth Indicators
- Net Revenue Retention (NRR): Above 100% means expansion revenue exceeds churn—the holy grail
- Gross Revenue Retention (GRR): Should be above 90% annually for B2B SaaS
- Growth rate consistency: Steady growth beats spiky growth that's hard to explain
- Cohort analysis: Are newer cohorts retaining better than older ones?
Unit Economics
Customer Acquisition Cost (CAC) and Lifetime Value (LTV) determine if your business model works at scale. The magic ratio is LTV:CAC of 3:1 or better, with CAC payback period under 12 months. If you're spending $1,000 to acquire customers worth $2,000 lifetime, you have a problem even if revenue is growing.
CAC Calculation Nuances
Include all sales and marketing costs: salaries, advertising, tools, agency fees, and events. Divide by new customers acquired in that period. Be honest about attribution—investors will catch inflated numbers during due diligence. Calculate CAC by channel to identify your most efficient acquisition strategies.
Efficiency and Burn Metrics
Burn rate (monthly cash spent) and runway (months until you run out of money) determine urgency and risk. Investors want to see: 18+ months runway after their investment, improving burn multiple (revenue growth divided by burn), and path to profitability or clear plan for next fundraise.
Gross margin reveals how profitable each dollar of revenue is. SaaS should have 70-85% gross margins, marketplaces 20-40%, and e-commerce 40-60%. Low gross margins mean you can't scale profitably no matter how much you grow. When preparing these metrics for investor meetings, staying focused with your TBPN coffee mug nearby helps maintain clarity during long analysis sessions.
The Rule of 40
For growth-stage SaaS companies, revenue growth rate plus profit margin should exceed 40%. A company growing 50% with -10% margins hits the rule of 40. This balances growth and efficiency—you can grow fast while losing money, or grow slower while profitable, but need to be strong on at least one dimension.
Product and Engagement Metrics
Daily Active Users (DAU) to Monthly Active Users (MAU) ratio shows stickiness. Consumer apps should have 20%+ DAU/MAU ratios. For B2B, track feature adoption rates, power users, and core action completion. Investors want to see that users actually engage with and depend on your product.
Join the TBPN community to access our investor metrics dashboard template and get feedback on your numbers before pitching. Our members include active VCs who can gut-check your metrics. Rock your TBPN classic tee to our next pitch practice session and get real-time feedback from experienced founders and investors.