Revenue Growth Indicators

For half a decade, I thought I was tracking the right metrics I was wrong Revenue. Growth rate. ROAS. Conversion rate. New customers. Repeat revenue All important But they could tell me the business was growing without telling me whether that growth was making the company more valuable You can buy more traffic, discount more aggressively, and acquire less-profitable customers while the top line keeps going up The business gets bigger That doesn’t automatically mean its equity value does A stronger Brand should make future revenue easier to earn, more profitable, and less dependent on buying every sale Here are the 11 metrics I wish I’d started tracking sooner, framed as questions: 1. Are branded organic searches growing faster than revenue? 2. Are contribution dollars and contribution margin going up? Contribution Dollars = Revenue - variable costs like COGS, marketing, and shipping 3. Is direct and branded search revenue growing faster than overall revenue? 4. Is the gap between gross and net sales shrinking? This signals less reliance on discounts and fewer returns 5. Are 30, 60, and 90-day incremental LTV going up, excluding the first purchase? 6. Is reach growing as fast as—or faster than—revenue? 7. Have your worst days gotten better? One way to measure this: is the average of your 30 lowest-revenue days trending up? 8. For organic search, is revenue per session rising while sessions are growing or stable? 9. Is your share of branded organic searches growing versus your competitive set—at both the Brand and category level? 10. Is Baseline Revenue growing, both in dollars and as a percentage of total revenue? I define Baseline Revenue as revenue from direct traffic, organic search, and organic social referrals It’s imperfect. But if it’s rising in dollars AND as a percentage of revenue, good things are generally happening 11. Is Baseline Revenue per branded organic search going up? Branded searches are an imperfect proxy for the Brand you’re building. Baseline Revenue per search shows whether you’re monetizing it better If searches are soaring but Baseline Revenue per search isn’t, that’s something to audit — A few caveats: None of these metrics are perfect. You can game any of them They’re also mostly leading indicators—not the ultimate company scorecard The ultimate outcome is more operating profit and net cash over time The right metrics also change with the company’s stage, economics, and strategy. A five-month-old company shouldn’t use the same scorecard as a 100-year-old company But if you can honestly answer “yes” to most of these questions, there’s a good chance the quality of your growth is improving And that gives you a better chance of building a more valuable company—not just a bigger one Question for the people of the internet: What else do you track to understand whether growth is increasing the quality and equity value of the business?

ARR gets thrown around in every SaaS conversation 📊 But ask someone to explain why a 120% Net Revenue Retention rate makes investors salivate, and you'll get blank stares. Most people know the acronym. Few understand why it's the metric that determines whether you get funded or not. Annual Recurring Revenue represents the predictable revenue a company expects to receive annually from its subscription customers. It's the lifeblood of SaaS businesses and the key metric for measuring sustainable growth. ➡️ WHAT MAKES ARR SPECIAL ARR focuses on three core characteristics. Predictable revenue streams give you visibility into future cash flows. Recurring subscriptions create steady income you can count on. Most importantly, ARR excludes one time fees, giving you a clean view of your sustainable business foundation. ➡️ WHY INVESTORS GET EXCITED ABOUT ARR Four main reasons drive investor interest in your ARR metrics. Valuation becomes straightforward with predictable revenue. Higher ARR multiples translate directly to higher company valuations. Stickiness indicates customer loyalty and product market fit. When customers stick around, your business becomes more valuable and less risky. Predictability gives investors confidence in your business model. Recurring revenue provides visibility into future cash flows. Scalability shows potential for growth with existing customers. Each customer represents an opportunity to expand revenue without acquisition costs. ➡️ THE FOUR MOVEMENTS OF ARR Your ARR changes through four distinct customer behaviors each month. NEW subscribers bring fresh recurring revenue streams. This represents your acquisition engine working effectively. CHURN happens when customers cancel subscriptions entirely. You lose their complete recurring revenue contribution. EXPANSION occurs when customers upgrade plans, add users, or purchase additional features. This increases revenue per customer without acquisition costs. CONTRACTION takes place when customers downgrade plans or reduce usage. This decreases recurring revenue from existing relationships. ➡️ CALCULATING YOUR ARR GROWTH Opening ARR + New ARR - Churn ARR + Expansion ARR - Contraction ARR = Ending ARR Track these components monthly to understand your growth trajectory and identify improvement areas. ➡️ RELATED METRICS THAT MATTER Monthly Recurring Revenue provides granular tracking for short term trends. Net Revenue Retention measures revenue retained from existing customers over time. Customer Acquisition Cost shows how much you spend to acquire each new customer. Customer Lifetime Value represents total expected revenue from each customer relationship. ARR Multiple shows how SaaS companies typically trade in the market. === Understanding ARR gives you the foundation for building a strong SaaS financial model that investors will appreciate. What ARR challenges are you facing in your business? Join the discussion below 👇

Product managers should stop thinking about revenue. Not because revenue doesn’t matter—but because it’s the wrong thing to focus on daily. Revenue is a lagging metric. By the time you see a change, the real work—the decisions, the bets, the execution—happened months ago. It’s too late. If you were hiring a PM, would you rather hear: 📉 "We improved revenue by 10%." 📈 "We identified Analytics as the key wedge driving upgrades. We doubled down on improving it—boosting adoption by 40% and expansion revenue by 15%." Great PMs don’t chase revenue. They focus on the inputs that drive it. Here’s how to turn leading indicators into business impact: 💰 To drive new customer revenue, optimize conversion rates. → Reduce friction in sign-up, onboarding, or checkout. → Example: Removing unnecessary form fields boosted conversions by 20%. 🚀 To increase adoption, improve onboarding & time-to-value. → Get users to their "aha moment" faster. → Example: Users who invited 3 teammates in Week 1 retained 50% better—so we optimized for that. 🔄 To improve retention, reinforce core product habits. → Focus on the key features that keep customers engaged long-term. → Example: Users who created recurring reports stayed 3x longer—so we pushed for that habit earlier. 📈 To unlock expansion revenue, drive engagement in high-value features. → Double down on features that act as a wedge for upgrades. → Example: Power users of Analytics were 3x more likely to upgrade—so we drove a 40% increase in adoption. Final thought: PMs who focus on leading indicators don’t just measure impact—they create it. -- 👋 I’m Ron Yang, a product leader and advisor. Follow me for insights on product leadership + strategy.

🚀 Investors don’t just want to know where you’ve been—they’re focused on where you’re going. They’re looking for a clear roadmap, not just a rearview mirror. To keep them engaged and confident in your vision, your investor updates need to go beyond the basics. Here’s what you REALLY need to include to paint a full picture of your company’s future: 🩺 Financial Health: Investors want to see that you're managing resources wisely and planning for sustainable growth. ✅ Monthly Revenue: Your bread and butter—how much are you generating? This is the clearest indicator of your business performance. ✅ Month-over-Month Growth: Is your revenue scaling consistently? Steady growth signals market traction and operational success. ✅ Monthly Burn Rate: What are your monthly expenses? Keeping burn rate under control is critical for long-term success. ✅ Runway: How long can you keep going with current cash in hand? Demonstrates how prepared you are for the road ahead. ✅ Gross Margin: How much profit are you retaining after covering the cost of goods sold? This metric shows how efficiently you’re managing production costs. ✅ Customer Acquisition Cost (CAC): What does it cost to acquire a new customer? Investors want to know if your sales and marketing spend is producing healthy returns. 📈 Traction & Growth: Numbers are great, but investors also want to see momentum and strategic wins. ✅ Headcount: Is your team growing in line with your company’s expansion? Team size can be a reflection of scaling operations. ✅ Notable Product Releases: Keep investors excited about product innovation. Share breakthroughs that reflect your competitive edge. ✅ Market Engagement: How many users or customers are actively engaged? Highlight user growth, but also share insights on retention and customer satisfaction. Investors want to see not just growth, but sticky growth. ✅ Partnerships & Strategic Collaborations: Highlight any major partnerships, alliances, or collaborations that could drive future growth. Investors love seeing how your ecosystem is expanding. ✅ Pipeline of Deals or Opportunities: Show that there’s momentum in your sales pipeline. How many prospective deals are in the works, and how close are they to closing? This provides a forward-looking view of revenue potential. ⚠️ Pro Tip: If you're in a highly technical or deep tech business, write your investor updates in clear, non-technical language. Remember, updates often go beyond investors and reach advisors and strategic stakeholders. Simplify the complex to ensure everyone understands your key points and vision. Keeping investors informed is not just about transparency; it’s about building trust and enthusiasm for your company’s future. What else do you include in your investor updates? Let’s discuss in the comments! 💬 #InvestorUpdates #StartUpGrowth #FinancialHealth #Traction #BusinessGrowth #Leadership #DeepTech #ClearCommunication

𝗔𝗿𝗲 𝗬𝗼𝘂 𝗠𝗶𝘀𝘀𝗶𝗻𝗴 𝘁𝗵𝗲 𝗕𝗶𝗴𝗴𝗲𝗿 𝗣𝗶𝗰𝘁𝘂𝗿𝗲? Many sales and marketing leaders focus on metrics that matter to their individual teams. While tracking website traffic, lead volume, or pipeline velocity is common, have you stepped back to see how these numbers fit into your overall revenue engine? Below is a snapshot of the key metrics each function typically tracks—and the revenue engine metrics you should monitor together for a complete picture: 𝗙𝗼𝗿 𝗦𝗮𝗹𝗲𝘀 𝗟𝗲𝗮𝗱𝗲𝗿𝘀:  • 𝗣𝗶𝗽𝗲𝗹𝗶𝗻𝗲 𝗩𝗲𝗹𝗼𝗰𝗶𝘁𝘆: How quickly deals move through your funnel. Faster velocity means efficient conversion.   • 𝗖𝗼𝗻𝘃𝗲𝗿𝘀𝗶𝗼𝗻 𝗥𝗮𝘁𝗲𝘀: The percentage of leads that turn into opportunities and closed deals.   • 𝗔𝘃𝗲𝗿𝗮𝗴𝗲 𝗗𝗲𝗮𝗹 𝗦𝗶𝘇𝗲 & 𝗪𝗶𝗻 𝗥𝗮𝘁𝗲𝘀: Indicators of deal quality and sales effectiveness. 𝗙𝗼𝗿 𝗠𝗮𝗿𝗸𝗲𝘁𝗶𝗻𝗴 𝗟𝗲𝗮𝗱𝗲𝗿𝘀:  • 𝗪𝗲𝗯𝘀𝗶𝘁𝗲 𝗧𝗿𝗮𝗳𝗳𝗶𝗰 & 𝗦𝗼𝗰𝗶𝗮𝗹 𝗘𝗻𝗴𝗮𝗴𝗲𝗺𝗲𝗻𝘁: Although often seen as vanity metrics, they offer a glimpse of initial interest.   • 𝗟𝗲𝗮𝗱 𝗩𝗼𝗹𝘂𝗺𝗲 & 𝗤𝘂𝗮𝗹𝗶𝘁𝘆: Focus on not just the number, but the qualification of leads (e.g., MQLs).   • 𝗟𝗲𝗮𝗱 𝗩𝗲𝗹𝗼𝗰𝗶𝘁𝘆 𝗥𝗮𝘁𝗲 (𝗟𝗩𝗥): The growth rate of qualified leads, hinting at future sales potential.   • 𝗔𝘁𝘁𝗿𝗶𝗯𝘂𝘁𝗶𝗼𝗻 & 𝗥𝗢𝗜: Which campaigns are truly driving valuable leads and revenue. 𝗙𝗼𝗿 𝗖𝘂𝘀𝘁𝗼𝗺𝗲𝗿 𝗦𝘂𝗰𝗰𝗲𝘀𝘀 𝗟𝗲𝗮𝗱𝗲𝗿𝘀:  • 𝗥𝗲𝘁𝗲𝗻𝘁𝗶𝗼𝗻 & 𝗖𝗵𝘂𝗿𝗻 𝗥𝗮𝘁𝗲𝘀: High retention and low churn show that your team is building lasting, profitable relationships.   • 𝗨𝗽𝘀𝗲𝗹𝗹 & 𝗖𝗿𝗼𝘀𝘀-𝗦𝗲𝗹𝗹 𝗥𝗮𝘁𝗲𝘀: Measure success in generating additional revenue from existing customers.   • 𝗡𝗣𝗦 & 𝗖𝘂𝘀𝘁𝗼𝗺𝗲𝗿 𝗛𝗲𝗮𝗹𝘁𝗵 𝗦𝗰𝗼𝗿𝗲𝘀: Gauge customer satisfaction and loyalty. 𝗥𝗲𝘃𝗲𝗻𝘂𝗲 𝗘𝗻𝗴𝗶𝗻𝗲 𝗠𝗲𝘁𝗿𝗶𝗰𝘀 𝘁𝗼 𝗠𝗼𝗻𝗶𝘁𝗼𝗿 𝗧𝗼𝗴𝗲𝘁𝗵𝗲𝗿:  • 𝗜𝗻𝘁𝗲𝗴𝗿𝗮𝘁𝗲𝗱 𝗙𝘂𝗻𝗻𝗲𝗹 𝗖𝗼𝗻𝘃𝗲𝗿𝘀𝗶𝗼𝗻: Track the seamless movement from MQL to SQL to closed deal.   • 𝗖𝗔𝗖 𝘃𝘀. 𝗖𝗟𝗩: Compare the cost of acquiring customers with the revenue they generate over their lifetime.   • 𝗨𝗻𝗶𝗳𝗶𝗲𝗱 𝗗𝗮𝘁𝗮 𝗘𝗳𝗳𝗲𝗰𝘁𝗶𝘃𝗲𝗻𝗲𝘀𝘀: Assess how well customer data is shared and used across teams for smarter targeting and personalization. Shifting your focus from isolated metrics to these holistic KPIs gives you clarity on where your revenue engine excels—and where it needs improvement. Together, these indicators provide a comprehensive view of how effectively your organization drives sustainable revenue growth. Are you ready to break down silos and embrace a holistic view of your performance metrics -  to unlock the full potential of your revenue engine?

August Revenue is N120 Million..... ❌ That's not how to report revenue. When it comes to closing the month-end, one thing management always wants to know first is: “How did we make money this period?” If you can make management see not only what was earned, but also why it was earned, how it compares to past performance, and where future opportunities lie, then you are not just reporting, you are adding value. My Approach ✔️ Step 1: Start with the headline number Always open your report with the revenue figure for the period. Keep it simple and clear. Example: Our total revenue for August 2025 was N120 million. ✔️ Step 2: Compare with relevant benchmarks A single number means little in isolation, that's why the real insight comes from comparing it against: ▪️ Previous Month (Actual) – Shows short-term growth or decline. ▪️ Budget/Target for the Month – Reveals if the company is on track. ▪️ Previous Year (Same Month/Period) – Shows long-term growth trend. This is where you bring the story alive. Suppose August 2025 revenue was N120 million. ▪️ July 2025 actual revenue was N100 million → Growth of 20% month-on-month. ▪️ Budgeted revenue for August was N125 million → Achieved 96% of target. ▪️ August 2024 revenue was N90 million → Growth of 33% year-on-year. Interpretation: Revenue grew strongly compared to last month and last year, showing an upward trend. However, it fell slightly short of the budget, meaning assumptions on product demand or pricing may have been a little optimistic. ✔️ Step 3: Go Deeper with Product Analysis Management wants to know what is driving the numbers. Break revenue down by product or service line. ▪️ Which products grew the fastest? ▪️ Which ones are underperforming? ▪️ Did price changes, discounts, or promotions affect sales? ▪️ Was the increase driven by volume (more units sold) or by higher prices? Example (for August 2025): ▪️ Product A: N60m revenue (up 25% vs last month):-growth driven by higher sales volume after a new marketing campaign. ▪️ Product B: N40m revenue (flat vs last month):- price discount boosted sales but reduced margins. ▪️ Product C: N20m revenue (down 10% vs last month):- customers switching to competitors due to pricing. Step 4: Highlight Growth Trends and Drivers Your report should explain not just the what, but the why. ▪️ Was growth driven by increased demand, new customers, or higher pricing? ▪️ Were there seasonal factors (festive periods, back-to-school, holidays)? ▪️ Did external factors like exchange rates, inflation, or regulation affect revenue? This helps management make informed decisions, whether to double down on what works or to fix what’s broken. Important! Clear revenue reporting gives management quick insight, supports wise decisions, ensures accountability to budgets, and guides strategic planning. Remember, revenue is not just a number; it’s the heartbeat of a business. I hope this helps.

I spent 25 years in boardrooms. These are the 10 metrics that actually matter. I've sat in a lot of board meetings where marketing metrics fell flat. Not because they were wrong. Because they weren't connected to anything the CFO or board actually cared about. Revenue growth is fine. But are you splitting new vs returning? CAC is fine. But are you showing the trend — and moving toward marginal CAC? LTV is fine. But is it on a margin basis, with a time horizon attached? These details are the difference between "Marketing is a cost" and "Marketing is an investment" I put together 10 KPIs that bridge the gap. Each one framed three ways: → What it tells you as a CMO → What the board actually sees → How to enhance it Swipe through the slides to learn more→ * * * Want the slide deck template that uses these exact metrics? → Grab it here: https://bit.ly/4qkLEuE

We analyzed payment data from several 7-8 figure brands on FanBasis. The pattern was impossible to ignore. REVENUE MIX Businesses over $1.5M monthly follow a similar revenue split: 80% from high-ticket offers. 20% from MRR (recurring revenue). Within that 80%, about 25% comes from buy-now-pay-later. This mix creates sustainable, predictable growth. HEALTH INDICATORS Top performers keep dispute rates under 2%. They don't fight refunds. They keep refund rates at 2-3% and move on. They focus on fulfillment quality over dispute wins. This shows they genuinely care about customer success, not just extracting money. THE PLATEAU WARNING The biggest plateau indicator: you can't scale ad spend. When ROAS tanks as you increase budget, you've hit your ceiling. Over-reliance on paid ads limits growth potential. Sustainable businesses diversify acquisition channels. If ads are your only lever, you're in trouble. Most founders think they have a marketing problem when they plateau. They don't. They have a business model problem. Your payment patterns reveal everything about your growth potential. If you're stuck, look at your revenue mix first. Then fix your acquisition channels. Then optimize your offer structure. The infrastructure always comes before the marketing.

2025 results from the world’s largest brewers send a clear signal: Revenue Growth Management is evolving. Across AB InBev , The HEINEKEN Company and Carlsberg Group: • Revenue per hectoliter up • Margins expanding • Volumes still flat or negative For years, growth came from price/mix. Premiumization. But sustainable growth cannot depend on pricing alone. Volume is back at the center of the long-term game. Because revenue = price × volume. And without penetration and frequency, pricing eventually hits a ceiling. The market context matters: • Emerging markets offer structural volume upside (demographics, urbanization, premium headroom) • Developed markets depend on premium, specialty and non-alcoholic growth • Affordability pressure is real across regions The next phase of RGM is not “more price.” It is smarter volume. That means: • Stronger price-pack architecture • Clear value ladders across income tiers • Occasion-based activation • Disciplined trade investment • Execution at outlet level In the end, the real strategy is not short-term price maximization. It is rebuilding revenue through the right balance of volume and mix. That’s the evolution of modern RGM. #RevenueGrowthManagement #GrowthStrategy #FMCG #CommercialStrategy #ValueCreation #BeerIndustry

Great to catch up again with my friend Joubin Mirzadegan on the #Grit podcast. This time, we kind of turned the tables, rolled up our sleeves, and worked on his new startup, Roadrunner, to answer a question every founder is asking: Should I be scaling faster? It's interesting that we have so many rigorous frameworks to recognize our revenue—bookings, GAAP, net income—but almost no quantitative frameworks to calculate how fast we should scale revenue. Imagine you're planning to scale from $10M to $50M ARR by hiring 10 new sales reps every month this year. How do you know if that's the right plan? The answer starts with building a revenue scaling speedometer—a set of leading and lagging indicators that inform us if we should scale faster by measuring two things: 1. Product-Market Fit Are customers consistently receiving the value you promised? The lagging indicator is customer retention. But retention takes time. The leading indicator of retention (LIR) is much more actionable: P% of customers complete Event E every T time period. If we are hitting the LIR, customers are seeing value. They will retain and expand in the longer term. We have PMF. 2. Go-to-Market Fit Can you acquire customers and deliver that value profitably? The lagging indicator is unit economics. The leading indicators come from working backward through the revenue velocity formula: [Opportunities × Win Rate × ACV] ÷ [Sales Cycle] Dashboard these inputs, and you'll know whether your go-to-market engine is ready to absorb more investment. Together, these two metrics inform whether we should be scaling faster. But what threshold indicates I should accelerate? It depends on the blitzscale pressure of your category. If you're competing in an AI-native category with well-funded competitors, set a lower tolerable P% (say 40%) and a higher tolerable payback period (around 20 months) because time is of the essence. You need to take more risks and build the plane while you are flying it. Joubin’s company is in this category. If you're in a more protected market—with long-term contracts, regulatory requirements, or little room for product defects—set a higher P% (perhaps 90% activation) and a shorter payback period before accelerating your hiring from 10 reps per month to 15. Whether you're growing from $10M to $100M or from $1B to $10B, every company needs a way to determine whether it should scale faster. Measure product-market fit. Measure go-to-market fit. Let the data—not intuition—determine your pace of scaling. For more 1st principles frameworks to guide your agentic GTM strategy, check out The Science of Scaling. 100% of proceeds are donated to mental health. The links to the book and the full GRIT episode are in the comments.