In a classic blogger’s example of “I wish I’d written that,” here is a great piece by David Skok on metrics for running your SaaS business with a focus on information that is meaningful and useful:
Metrics for metric’s sake are not very useful. Instead the goal is to provide a detailed look at what management must focus on to drive a successful SaaS business. For each metric, we will also look at what is actionable.
The piece also includes some guidelines. Did you know, for example, that the lifetime value of a customer should ideally be greater than three times the cost to acquire that customer and that you should aim to recoup the cost of acquiring that customer in less than a year?
Skok’s article is a crash course in SaaS economics. If you’re serious about a SaaS business, read the whole thing.
Tags: David Skok, Matrix Partners, saastop