Metric Glossary

Browse 10 metric terms defined in plain English, from the cultural dictionary of computing.

10 Metric Terms

ARR
Annual Recurring Revenue — the value of contracted recurring revenue normalized to a one-year period. The North Star metric for SaaS businesses. Not to be...
Burn Rate
The rate at which a company spends its cash reserves before generating positive cash flow. Gross burn is total monthly spending; net burn subtracts revenue....
Churn
The rate at which customers cancel their subscriptions or stop using a product. A SaaS company's most watched (and most dreaded) metric. Customer churn counts...
Hockey Stick Growth
A revenue or user growth pattern that resembles a hockey stick when graphed — flat for a period, then suddenly turning sharply upward. The chart every VC wants...
Latency
The time delay between a request and its response. In networking, it's the round-trip time for a packet. In user experience, it's the time between click and...
LTV / CAC
Lifetime Value / Customer Acquisition Cost — the ratio of how much revenue a customer generates over their lifetime to how much it costs to acquire them. The...
Perplexity
A metric that measures how well a probability model predicts a sample. Lower perplexity means the model is less 'surprised' by the data. Informally, it...
Retention
Retention in product and business context measures the percentage of users or customers who continue using a product or service over time. It is widely...
Runway
Runway is the amount of time a startup can continue operating before it runs out of money, assuming its current burn rate (monthly spending minus revenue)...
Throughput
The amount of work a system can handle per unit of time — requests per second, transactions per minute, data processed per hour. Not the same as latency: you...

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