Why Do Investors Care So Much About LTV:CAC?
https://a16z.com/why-do-investors-care-so-much-about-ltvcac
https://a16z.com/why-do-investors-care-so-much-about-ltvcac
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🚀 Essential SaaS Metrics: What Really Matters?
A SaaS business runs on subscriptions.
Its health = predictable revenue + strong retention + efficient growth.
Here are the core metrics every SaaS founder, operator, and investor should track.
---
## 💰 Core Financial Metrics
🔹 MRR / ARR — Monthly / Annual Recurring Revenue
Your primary indicator of predictable revenue.
🔹 ARPU — Average Revenue Per User
How much revenue each customer generates on average.
🔹 ARR Growth Rate — Percentage increase in ARR
Shows how fast the company is scaling.
🔹 Expansion Revenue — Upsells, upgrades, add-ons
The healthiest form of growth comes from existing customers.
🔹 Gross Profit Margin
Revenue minus cost of goods sold. Strong SaaS businesses typically operate at 70–90%.
---
## 🔁 Retention & Customer Success Metrics
🔹 Churn Rate (Logo & Revenue)
Percentage of customers or revenue lost during a period. Lower = stronger stability.
🔹 Net Dollar Retention (NDR / NRR)
Revenue retained from existing customers including upgrades/downgrades.
If >100%, your revenue grows even without acquiring new customers.
🔹 NPS (Net Promoter Score)
Measures customer loyalty and likelihood to recommend.
🔹 Usage / Activation Rate
How actively customers use your product. Low usage today = churn tomorrow.
---
## 📈 Acquisition & Efficiency Metrics
🔹 CAC (Customer Acquisition Cost)
Total sales & marketing spend required to acquire a new customer.
🔹 LTV / CLV (Customer Lifetime Value)
Total revenue expected from a customer over their lifecycle.
🔹 LTV-to-CAC Ratio
Measures ROI on acquisition. Ideal benchmark: 3:1 or higher.
🔹 CAC Payback Period
Months required to recover acquisition costs. Ideally < 12 months.
🔹 Rule of 40
Revenue growth rate + profit margin should exceed 40%.
A strong benchmark for balanced growth.
---
## 🔥 Additional Stability Metrics
• Cash Runway — How long the company can operate before running out of cash
• Customer Concentration — Revenue dependence on a few major customers
• Burn Multiple — Efficiency of growth relative to cash burned
---
📌 SaaS isn’t just about growth.
It’s about *predictable, efficient, and sustainable growth.*
Track the right metrics. Build with discipline. Scale with confidence.
A SaaS business runs on subscriptions.
Its health = predictable revenue + strong retention + efficient growth.
Here are the core metrics every SaaS founder, operator, and investor should track.
---
## 💰 Core Financial Metrics
🔹 MRR / ARR — Monthly / Annual Recurring Revenue
Your primary indicator of predictable revenue.
🔹 ARPU — Average Revenue Per User
How much revenue each customer generates on average.
🔹 ARR Growth Rate — Percentage increase in ARR
Shows how fast the company is scaling.
🔹 Expansion Revenue — Upsells, upgrades, add-ons
The healthiest form of growth comes from existing customers.
🔹 Gross Profit Margin
Revenue minus cost of goods sold. Strong SaaS businesses typically operate at 70–90%.
---
## 🔁 Retention & Customer Success Metrics
🔹 Churn Rate (Logo & Revenue)
Percentage of customers or revenue lost during a period. Lower = stronger stability.
🔹 Net Dollar Retention (NDR / NRR)
Revenue retained from existing customers including upgrades/downgrades.
If >100%, your revenue grows even without acquiring new customers.
🔹 NPS (Net Promoter Score)
Measures customer loyalty and likelihood to recommend.
🔹 Usage / Activation Rate
How actively customers use your product. Low usage today = churn tomorrow.
---
## 📈 Acquisition & Efficiency Metrics
🔹 CAC (Customer Acquisition Cost)
Total sales & marketing spend required to acquire a new customer.
🔹 LTV / CLV (Customer Lifetime Value)
Total revenue expected from a customer over their lifecycle.
🔹 LTV-to-CAC Ratio
Measures ROI on acquisition. Ideal benchmark: 3:1 or higher.
🔹 CAC Payback Period
Months required to recover acquisition costs. Ideally < 12 months.
🔹 Rule of 40
Revenue growth rate + profit margin should exceed 40%.
A strong benchmark for balanced growth.
---
## 🔥 Additional Stability Metrics
• Cash Runway — How long the company can operate before running out of cash
• Customer Concentration — Revenue dependence on a few major customers
• Burn Multiple — Efficiency of growth relative to cash burned
---
📌 SaaS isn’t just about growth.
It’s about *predictable, efficient, and sustainable growth.*
Track the right metrics. Build with discipline. Scale with confidence.
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AnalyticsEngineeringSQLdbt.pdf
10.3 MB
Rui Machado / Analytics Engineering with SQL and dbt
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🔰 The 4 Types of SQL Joins
SQL joins combine rows from two or more tables based on a related column. Here are the different types of joins you can use:
1⃣ Inner Join
Returns only the matching rows between both tables. It keeps common data only.
🔢 Left Join
Returns all rows from the left table and matching rows from the right table. If a row in the left table doesn’t have a match in the right table, the right table’s columns will contain NULL values in that row.
🔢 Right Join
Returns all rows from the right table and matching rows from the left table. If no matching record exists in the left table for a record in the right table, the columns from the left table in the result will contain NULL values.
🔢 FULL OUTER JOIN
Returns all rows from both tables, filling in NULL for missing matches.
SQL joins combine rows from two or more tables based on a related column. Here are the different types of joins you can use:
1⃣ Inner Join
Returns only the matching rows between both tables. It keeps common data only.
🔢 Left Join
Returns all rows from the left table and matching rows from the right table. If a row in the left table doesn’t have a match in the right table, the right table’s columns will contain NULL values in that row.
🔢 Right Join
Returns all rows from the right table and matching rows from the left table. If no matching record exists in the left table for a record in the right table, the columns from the left table in the result will contain NULL values.
🔢 FULL OUTER JOIN
Returns all rows from both tables, filling in NULL for missing matches.
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🔥 Top 8 SQL Tricks Every Data Person Should Know
1️⃣ QUALIFY instead of subqueries
Filter window function results directly — no wrapping needed:
2️⃣ EXCEPT in SELECT * (BigQuery)
Grab everything but the noise:
3️⃣ COUNT(DISTINCT x) vs APPROX_COUNT_DISTINCT(x)
On billions of rows, approximate counts are 10x faster and usually accurate within ~1%.
4️⃣ NULL-safe comparisons
5️⃣ Window frames are not all the same
6️⃣ Anti-joins done right
7️⃣ GROUP BY ALL
Stop counting column positions. Group by every non-aggregated column automatically (BigQuery, Snowflake, DuckDB).
8️⃣ CTEs ≠ optimization
In some engines CTEs are inlined, in others materialized. If a CTE is referenced twice and it's heavy — check the query plan, don't assume.
#SQL #BigQuery #DataEngineering #Analytics
1️⃣ QUALIFY instead of subqueries
Filter window function results directly — no wrapping needed:
QUALIFY ROW_NUMBER() OVER (PARTITION BY user_id ORDER BY created_at DESC) = 12️⃣ EXCEPT in SELECT * (BigQuery)
Grab everything but the noise:
SELECT * EXCEPT (raw_payload, _synced_at) FROM t3️⃣ COUNT(DISTINCT x) vs APPROX_COUNT_DISTINCT(x)
On billions of rows, approximate counts are 10x faster and usually accurate within ~1%.
4️⃣ NULL-safe comparisons
a = b is NULL when either side is NULL. Use IS NOT DISTINCT FROM (or <=> in MySQL) to compare safely.5️⃣ Window frames are not all the same
ORDER BY inside OVER() silently changes the default frame to RANGE UNBOUNDED PRECEDING → CURRENT ROW. Running totals? Fine. Full-partition aggregates? Bug.6️⃣ Anti-joins done right
NOT EXISTS beats NOT IN — the latter returns nothing if the subquery contains a single NULL. 😬7️⃣ GROUP BY ALL
Stop counting column positions. Group by every non-aggregated column automatically (BigQuery, Snowflake, DuckDB).
8️⃣ CTEs ≠ optimization
In some engines CTEs are inlined, in others materialized. If a CTE is referenced twice and it's heavy — check the query plan, don't assume.
#SQL #BigQuery #DataEngineering #Analytics
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