Note on sample sizes: Sample size varies by metric based on source coverage and filter availability. Metrics with wider industry coverage (e.g., NRR, ARR growth) have larger samples. More granular slices (by GTM motion, ACV tier) have smaller effective n. All sample sizes below reflect Q1 2026 dataset.
Non-affiliation
BenchmarkHQ is an independent product of Dynakai Industries LLC. References on this page describe BenchmarkHQ definitions and standardization only. They do not imply affiliation with, endorsement from, licensing by, formal partnership with, or access to nonpublic data from any outside organization.
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Retention Metrics
Net Revenue Retention (NRR)
Also called: NDR · Net Dollar Retention
Definition
Measures how much recurring revenue from existing customers at the start of a period has grown or shrunk by the end of that period, including expansion, contraction, and churn. Values above 100% indicate net expansion from the existing customer base.
Formula
(Starting MRR + Expansion MRR − Contraction MRR − Churned MRR) ÷ Starting MRR × 100
Sample size
n = 620–850 companies depending on ARR band filter. Median cohort size across all peer groups.
Last updated
Q1 2026 (data period: FY2024 actuals + H1 2025 trailing)
Normalization note
Where sources reported annualized vs. trailing-12-month NRR differently, we standardized to trailing-12-month. Companies with <12 months of data were excluded from the NRR cohort.
Gross Revenue Retention (GRR)
Also called: GDR · Gross Dollar Retention · Logo-adjusted Retention
Definition
Like NRR but capped at 100% — measures only revenue preserved from the existing base, excluding expansion upsell. A floor metric: strong GRR means the core product retains well even without upsell.
Formula
(Starting MRR − Contraction MRR − Churned MRR) ÷ Starting MRR × 100Always ≤ 100%; expansion is excluded from numerator
Sample size
n = 480–720 companies. Lower coverage than NRR because some survey sources only ask for NRR.
Last updated
Q1 2026 (data period: FY2024 actuals)
Logo Churn Rate
Also called: Customer Churn · Account Churn
Definition
The percentage of customer accounts (logos) that cancel or do not renew in a given period. Measures breadth of churn rather than dollar impact.
Formula
Churned Customers ÷ Starting Customer Count × 100
Sample size
n = 540–780 companies. Annual churn rate basis. Monthly churn where reported was annualized (×12).
Last updated
Q1 2026 (data period: FY2024 actuals)
Normalization note
Sources mixing monthly vs. annual reporting were standardized to annual. Logo churn is reported separately from revenue churn — they diverge for companies with significant ACV variation across their customer base.
Revenue Churn Rate
Also called: MRR Churn · ARR Churn · Gross Churn
Definition
The percentage of MRR/ARR lost from cancellations and downgrades, before any expansion. The dollar-weighted equivalent of logo churn.
Formula
(Churned MRR + Contraction MRR) ÷ Starting MRR × 100
Sample size
n = 480–660 companies.
Last updated
Q1 2026 (data period: FY2024 actuals)
Growth Metrics
ARR Growth Rate
Also called: YoY ARR Growth · Annual Growth Rate
Definition
Year-over-year percentage growth in Annual Recurring Revenue. Primary growth signal for SaaS businesses.
Formula
(Current ARR − Prior Year ARR) ÷ Prior Year ARR × 100
Sample size
n = 780–1,100 companies — largest cohort in the dataset. Widely reported across all sources.
Last updated
Q1 2026 (data period: FY2024 actuals + H1 2025 trailing where available)
Normalization note
ARR band quartiles (p25/p50/p75) are computed within each band. Cross-band comparisons should account for the natural growth rate compression at larger ARR scales.
Magic Number
Also called: Sales Efficiency Ratio
Definition
Measures how efficiently new ARR is generated relative to S&M spend. Interpretation varies by business model, growth stage, pricing model, and market context. Members can compare against peer-group distributions inside reports and exports.
Formula
Net New ARR (Quarter) ÷ S&M Spend (Prior Quarter)
Sample size
n = 320–480 companies. Lower coverage because S&M spend requires survey self-reporting or public financials.
Last updated
Q1 2026 (data period: FY2024 actuals)
Efficiency Metrics
Customer Acquisition Cost (CAC)
Also called: blended CAC · average CAC
Definition
Total cost to acquire one new customer, including all S&M expenses divided by the number of new customers added in the same period.
Formula
Total S&M Expense (Period) ÷ New Customers Acquired (Period)
Sample size
n = 280–420 companies. Broken down by GTM motion (PLG, Sales-led, Channel) — smaller sub-cohorts apply.
Last updated
Q1 2026 (data period: FY2024 actuals)
Normalization note
CAC is segmented by GTM motion (Product-Led Growth, Sales-Led, Channel/Partner). Blended CAC benchmarks are for companies with a single primary motion. Multi-motion companies are excluded from the per-motion breakdown.
CAC Payback Period
Also called: months to recover CAC
Definition
Number of months it takes to recover the cost of acquiring a customer through gross profit from that customer. Shorter = more capital efficient.
Formula
CAC ÷ (ACV × Gross Margin %)Denominator is annual gross profit per customer; divide by 12 for monthly payback
Sample size
n = 260–400 companies. Requires both CAC and gross margin data from the same company — reduces coverage vs. individual metrics.
Last updated
Q1 2026 (data period: FY2024 actuals)
LTV:CAC Ratio
Also called: Customer Lifetime Value to CAC · LTV/CAC
Definition
Ratio of the expected lifetime value of a customer to the cost of acquiring them. Interpretation varies by business model, growth stage, pricing model, and market context. Members can compare against peer-group distributions inside reports and exports.
Formula
LTV ÷ CACwhere LTV = (ACV × Gross Margin %) ÷ Logo Churn Rate
Sample size
n = 220–360 companies. Requires CAC, gross margin, and churn data — smallest cohort due to multi-signal requirement.
Last updated
Q1 2026 (data period: FY2024 actuals)
Standardization note
This is the BenchmarkHQ standardized version used for cross-source comparability. LTV is calculated as (ACV × Gross Margin %) ÷ Logo Churn Rate. CAC is blended acquisition cost (sales + marketing spend ÷ new logos). Sources using different LTV definitions (e.g., excluding gross margin) are normalized to this formula.
Burn Multiple
Also called: cash efficiency ratio (David Sacks definition)
Definition
How much cash a company burns for every dollar of net new ARR added. Lower is better. Interpretation varies by business model, growth stage, pricing model, and market context. Members can compare against peer-group distributions inside reports and exports.
Formula
Net Cash Burned ÷ Net New ARR Added
Sample size
n = 300–440 companies.
Last updated
Q1 2026 (data period: FY2024 actuals)
Standardization note
This is the BenchmarkHQ standardized version used for cross-source comparability. Net cash burned uses ending minus beginning cash (excluding financing inflows). Sources using EBITDA-based burn approximations are normalized to actual cash burn where possible.
Rule of 40
Also called: R40 · efficiency score
Definition
The principle that a healthy SaaS company's ARR growth rate plus free cash flow margin should equal or exceed 40%. Balances growth and profitability — a company growing at 60% can sustain a –20% FCF margin and still score 40.
Formula
ARR Growth Rate (%) + FCF Margin (%) ≥ 40Primary (BenchmarkHQ standardized): FCF margin. Alternative (source-specific variant): Some sources substitute EBITDA margin — we note this when it occurs.
Sample size
n = 420–600 companies.
Last updated
Q1 2026 (data period: FY2024 actuals)
Normalization note
FCF-based Rule of 40 is the BenchmarkHQ standardized version used for cross-source comparability. Where sources used EBITDA margin instead of FCF margin, we note the substitution. EBITDA-based variants are labeled as such in export data and typically run 5–10 points higher than the FCF-based equivalent for growth-stage companies.
Margin Metrics
Gross Margin
Also called: Software Gross Margin · COGS Margin
Definition
Revenue remaining after direct cost of goods sold (hosting, support, CS). Interpretation varies by business model, growth stage, pricing model, and market context. Members can compare against peer-group distributions inside reports and exports. Professional services revenue in the revenue mix will typically lower this figure.
Formula
(Revenue − COGS) ÷ Revenue × 100
Sample size
Sample-size note: coverage varies by cohort and source availability. See member exports and report notes where available.
Last updated
Q1 2026 (data period: FY2024 actuals)
Normalization note
Pure-software gross margin is reported separately from blended (software + professional services) gross margin. Where sources didn't distinguish, we flagged as blended. PS-heavy companies (>30% of revenue) were excluded from the pure-SaaS cohort.
Free Cash Flow (FCF) Margin
Also called: FCF %; cash generation margin
Definition
Operating cash flow minus capital expenditures, divided by revenue. The truest measure of cash generation efficiency — harder to massage than EBITDA.
Formula
(Operating Cash Flow − CapEx) ÷ Revenue × 100
Sample size
n = 280–400 companies. Smaller coverage because many private companies don't track formal FCF; proxied from burn rate where needed.
Last updated
Q1 2026 (data period: FY2024 actuals)