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How to Categorize Expenses in a SaaS Startup v2.0

Baremetrics

The gist of it is that Cost of Revenue includes costs that go into providing your Software as a Service. You’ll need Cost of Revenue to calculate your Gross Margin, which in turn you need to calculate Customer Lifetime Value (LTV), Customer Acquisition Cost (CAC) Payback Time and to understand your company’s unit economics in general.

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A Look Back: “SaaS Metrics Masterclass: Key Business Metrics, Pricing Strategies and Billing Models with Stripe’s Head of France and Southern Europe, Guillaume Princen” (Video + Transcript)

SaaStr

Average Revenue per Customer. Customer Lifetime Value (LTV). Customer Acquisition Cost (CAC). & High touch sales on the opposite, is where customers need some help in deciding whether or how to adopt your product. I didn’t want to pay for this service.” MRR, obviously. Transcript.

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Subscription renewal: getting customers to renew subscriptions

ProfitWell

Yes, they might kick the can down the road a little longer, but they only delay the inevitable while giving customers an awful experience in the meantime. The key feature separating subscription businesses from their more standard counterparts is the recurring nature of payments. Of course, you know better.