How to Measure SaaS Growth Strategy Progress

Everyone talks about building a top 1% SaaS product. Very few can actually answer the questions or measure the KPIs that matter most. After digging into Andrew Chen’s book "The Cold Start Problem," here are the questions and KPIs every founder and operator should obsess over if they want to build a product that dominates. Key Strategic Questions Market & Network Foundation Who are the atomic users that will get immediate value from our product? What network type are we building: utility network like Slack, marketplace like Airbnb, content/social like Instagram, or a hybrid? What is the minimum network density needed for users to feel value? How do we seed the first networks—niche communities, single-player tools, or incentives? Growth & Scale What are our engines of growth: virality, paid acquisition, partnerships, integrations, sales? Where is the tipping point that turns slow adoption into exponential growth? What is our playbook for scaling from atomic networks to large networks? How do we avoid the chicken-and-egg problem between supply and demand? Retention & Engagement What is the core action that users repeat every day? How do we measure whether users are sticking? What triggers users to come back daily or weekly? What is the minimum retention rate required for sustainable growth? Defensibility & Competition How do network effects make us stronger as we scale? What switching costs prevent churn once a network is established? How do we defend against competitors who try to replicate our playbook? Monetization & Business Model When is the right moment to layer in monetization without stalling growth? What monetization aligns with our network effects: usage-based, subscription, transaction fees? How do we balance growth with revenue optimization? Core KPIs to Track and Improve Acquisition & Activation New user signups and activations Cost per activated user Viral coefficient (K-factor) Activation rate to the “aha” moment Retention & Engagement DAU/MAU ratio Cohort retention curves Time to first value Core action frequency Churn rate Network Effects Network density Cross-side liquidity Virality loop completion rate Power users percentage Revenue & Monetization ARR and MRR growth Net dollar retention ARPU Free to paid conversion rate CAC payback period Scaling & Defensibility Network concentration risk Geographic or vertical expansion Competitor overlap and switching rate The playbook is simple but not easy. In the early stage you optimize activation, TTFV, and network density. In growth you push virality, retention, and DAU/MAU. In scale you drive ARR, net dollar retention, CAC payback, and expansion. In defensibility you double down on network effects, switching costs, and market share. This is how you build a top 1% SaaS product.

Imagine this. You're sitting in the next board meeting. Revenue looks flat. CAC is climbing. New logo sales are slower than forecast. Everyone turns to you, the CFO. “What’s our plan?” If you don’t have a Net Revenue Retention (NRR) story to tell... You don’t have a story at all. In SaaS, NRR isn’t just a metric. It’s a reflection of how resilient, or fragile, your business really is. → It tells you how much your customers love you. → It shows whether your revenue grows on its own, or if you're trapped on the acquisition treadmill. → It decides if you’re compounding value... or quietly bleeding out. Where does your NRR stand? → < 100% ➔ You’re losing ground. Churn is eating your future. → 100–120% ➔ You’re stable, but expansion isn't pulling its weight yet. → 120%+ ➔ You’re riding a compounding machine. The valuation premiums start here. If you want to move NRR, you need to think like a strategist, not just a scorekeeper. Here is how 👇🏻 1. Expansion-first mindset: ↳ Upsells and cross-sells should be built into the customer journey, not bolted on later. 2. Churn risk radar: ↳ Low usage, late payments, silent accounts, spot them early. Silent customers are halfway out the door. 3. Pricing and packaging that invite upgrades: ↳ Make it easier to buy more, without heavy-handed sales. 4. Customer success as a revenue engine: ↳ Not just a support function. The best Success teams drive expansions without needing a quota. 5. Cohort deep dives: ↳ Not all customers expand equally. Find your power users and clone them. Why this matters even more now? It’s 5x cheaper to expand an existing customer than to acquire a new one. Every 1% improvement in NRR can lift your valuation by 15–20% over five years. High NRR buys you resilience when markets turn, and leverage when opportunities come. We all know the era of “growth at all costs” is dead. NRR-led growth is how you build a durable SaaS business. PS: How aggressively are you planning to move your NRR this year? Because if it's not on your agenda, it's definitely on your competitor's. ♻️ Share this to a finance leader who has outgrown their spreadsheets 🔔 Follow Mariya Valeva for more SaaS finance insights ➡️ And check out Subscript if you’re done paying the hidden tax of manual finance #SubscriptCFOPartner

🏊♂️ SaaS executives I meet are drowning in quarterly metrics reports, lacking actionable insights and taking a lot of time. My blueprint streamlines leadership meetings by prioritizing data-driven diagnosis and comparison to benchmarks for your scale. ⏸ Stop the data overload! Most SaaS leaders struggle with a flood of metrics each quarter. My framework cuts through the noise by: 🌍 Guiding you to the industry benchmarks relevant to your company's stage. 🆘 Helping you identify 3-4 key metrics that truly reflect your company's health. 👓 This laser focus lets you have more productive leadership meetings, prioritizing data-driven diagnosis over raw numbers. Example: 👉 Early-stage Company. Below $10M ❓ Question1: Are you retaining your revenue? 🔘 Metric: Gross Revenue Retention (GRR) 🎚 Benchmark: 80% to 90% ❓ Question 2: Are you closing a high % of sales opportunities? 🔘 Metric: Win Rate 🎚 Benchmark: 20% to 40% ❓ Question 3: Are your customers Satisfied? 🔘 Metric: NPS or Customer Satisfaction Score 🎚 Benchmark NPs: 30 to 50 Satisfaction: 70% to 80% ❓ Question 4: Driving growth from existing customers? Metric: New and Existing Annual Recurring Revenue (ARR) 🎚 Benchmark: 92% to 112% The most significant contribution of my work is the development of a diagnostic tool. This tool allows for a precise identification of the key areas where these benchmarks can be enhanced.

Most SaaS founders chase revenue, but the real problem is what they’re not tracking. They focus on: - Sales - Scaling - Signups But behind the scenes, pricing leaks are quietly draining profits. A small tweak in pricing could 2x retention. But without the right metrics, they never see the problem. Pricing isn’t just a number, it’s a growth engine hiding in plain sight. Here’s what you should be measuring: → LTV → CAC → NRR → MRR → ARR → ARPU → Churn Rate → Price Sensitivity → Discount Impact → Expansion Revenue SaaS growth isn’t just about more customers, It’s about pricing them right. P.S. Which pricing metric has made the biggest impact on your SaaS growth? ♻️ If you find value, let others benefit too. __________________________________________ Ready for more SaaS pricing insights? Follow me, Marcos Rivera🔔