MRR, churn, CAC, LTV, burn rate, runway — what each metric means, what good looks like, and how a fractional CFO uses them to drive decisions.
Metrics without context are noise. The value of a fractional CFO isn't just tracking numbers — it's knowing which numbers matter at your stage, what "good" looks like, and what action to take when a metric moves in the wrong direction.
This guide covers the 20 KPIs that matter most for UK startups, organised by category, with benchmarks and explanations of why each one drives decisions.
Predictable revenue from subscriptions in a given month.
Why it matters: The foundation metric for SaaS. Everything else — growth rate, churn, NRR — is calculated from MRR. Track new, expansion, contraction, and churned MRR separately.
MRR × 12. The annualised revenue run rate.
Why it matters: The number investors use to value your company. Most UK seed rounds happen at £100k–£500k ARR. Series A typically requires £1m+ ARR.
Month-on-month or year-on-year percentage increase in revenue.
Why it matters: Growth rate determines your valuation multiple. Consistent growth matters more than spikes — investors look at the trend over 6+ months.
Total value of transactions processed through the platform.
Why it matters: The top-line activity metric for marketplaces. Revenue = GMV × take rate. Growing GMV without growing take rate means more volume but not necessarily more profit.
Revenue retained from existing customers after expansion, contraction, and churn.
Why it matters: NRR above 100% means existing customers grow your revenue even without new sales. Above 110% is excellent. Below 90% is a retention crisis investors will flag.
Revenue retained from existing customers excluding expansion — only contraction and churn.
Why it matters: GRR strips out the flattering effect of upsells. It tells you how sticky your core product is. Below 85% GRR means your product has a retention problem that upsells are masking.
Percentage of customers lost per month.
Why it matters: Even small monthly churn compounds. 5% monthly churn means you lose 46% of customers per year. For SMB SaaS, under 5% monthly is acceptable; for enterprise, under 1%.
Total sales and marketing spend divided by new customers acquired in the period.
Why it matters: If CAC is higher than LTV, you lose money on every customer. Track CAC by channel — some channels are profitable, others aren't. A fractional CFO helps you see which.
Total revenue expected from a customer over the duration of the relationship.
Why it matters: LTV determines how much you can afford to spend on acquisition. For SaaS: ARPA ÷ monthly churn rate. The LTV:CAC ratio is the efficiency metric investors scrutinise.
Revenue minus cost of goods sold, divided by revenue.
Why it matters: Determines how much of each pound of revenue is available to fund growth. SaaS should target 70%+. Services businesses 40–60%. Declining gross margin signals scaling problems.
Months it takes to recover the cost of acquiring a customer.
Why it matters: Long payback periods drain cash. Under 12 months is good for SMB SaaS; under 18 months for enterprise. If payback exceeds runway, you'll run out of money before customers become profitable.
Net cash consumed per month (cash out minus cash in).
Why it matters: The speed at which you consume cash determines how long you survive. Track gross burn (total spend) and net burn (spend minus revenue) separately.
Cash balance divided by monthly net burn. Expressed in months.
Why it matters: The single most important number for survival. Below 6 months = fundraise now. Model under three scenarios. Use the runway calculator for a quick estimate.
Free cash flow divided by ARR growth. Measures capital efficiency.
Why it matters: Shows how efficiently you convert invested capital into recurring revenue. Relevant from Series A onwards when capital efficiency becomes a key investor metric.
Revenue growth rate + profit margin. Should sum to 40% or higher.
Why it matters: Balances growth against profitability. A company growing 60% with -20% margins (score: 40) is as healthy as one growing 20% with 20% margins. Used from Series A onwards.
Total revenue divided by headcount.
Why it matters: A proxy for operational efficiency. Declining revenue per employee as you hire signals that scaling is adding cost faster than output. Watch this before every hiring decision.
Not every metric matters at every stage. Here's what to focus on:
| Metric | Pre-seed | Seed | Pre-Series A | Series A+ |
|---|---|---|---|---|
| Burn rate | ● | ● | ● | ● |
| Runway | ● | ● | ● | ● |
| MRR / Revenue | ○ | ● | ● | ● |
| Growth rate | ○ | ● | ● | ● |
| Gross margin | ○ | ● | ● | ● |
| Logo churn | ○ | ○ | ● | ● |
| NRR / GRR | ○ | ○ | ● | ● |
| CAC | ○ | ○ | ● | ● |
| LTV & LTV:CAC | ○ | ○ | ● | ● |
| CAC payback | ○ | ○ | ● | ● |
| Rule of 40 | ○ | ○ | ○ | ● |
| Revenue per employee | ○ | ○ | ○ | ● |
● = track monthly ○ = not yet relevant or insufficient data
A fractional CFO selects the right 6–8 metrics for your stage and builds them into your monthly board pack as trend charts — so the data tells a story, not just a snapshot.
AccTek's fractional CFO builds your KPI dashboard from live Xero and Stripe data — delivered in your board pack every month.
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