***** Notion available in Fincome

A

Active*

Status of a subscription that generated billing > €0 over the last period. An active customer has at least one active subscription and no overdue subscription.

Annual Contract Value (ACV)*

The annualized version of ARPA.

[ACV] = [ARPA] x 12

ARPA (average basket)*

The average basket, also called Average Revenue Per User (ARPU) or Average Revenue Per Account (ARPA), corresponds to the average MRR per active subscriber. Tracking ARPU is a way to assess your ability to sell increasing amounts to your subscribers.

[ARPU] = [MRR] ÷ [Number of active subscribers]

Annual Recurring Revenue (ARR)*

The predictable recurring revenue to be earned from active subscriptions over the next twelve months.

[ARR] = [MRR] x 12

ARR / FTEs (Full-Time Equivalents)

Annualized recurring revenue per employee. SaaS benchmark: €100–150k per FTE for growing companies.

[ARR/FTEs] = [ARR] ÷ [Number of employees (FTEs)]

Attrition (Churn)*

Loss of MRR related to the termination of a customer's last active subscription (see "Churn rate").
Average Sales Cycle
Average duration between opportunity opening and signing. In SMB SaaS: 60-90 days; Mid Market: 3-5 months.

[Average Sales Cycle] = [Total days to close all deals] ÷ [Number of closed deals]

B

Burn rate

Net cash consumption per month.

[Burn rate] = [Total monthly cash outflow] − [Total monthly cash inflow]

Burn multiple

Indicator that measures how much a company burns relative to its growth. A value ≤ 2 is considered healthy during a growth period.

C

Customer Acquisition Cost (CAC)*

Sum of all the costs related to acquiring a new customer, relative to the number of customers acquired over the observed period. It is a measure of the efficiency of your customer acquisition and a key factor of your profitability (it is generally compared to the Lifetime Value (LTV)). The default period is 3 months, which smooths the evolution of monthly expenses.

[CAC] = [Sum of marketing and sales expenses over the period] ÷ [Number of new customers over the period]

CAC Payback Period*

Number of subscription months needed to pay back the costs related to acquiring a customer.

[CAC Payback Period] = [Total acquisition costs over the period] ÷ [MRR of the customers acquired over the period]

Retention campaigns

Targeted action aimed at preventing churn; Fincome offers the export of "at-risk" segments.

CMRR (Committed MRR)*

Current MRR ± future movements already contracted (ramp-ups, future churns), for a "forward looking" view.

Cohorts*

Retention analysis of a group of customers who joined in the same month/quarter.

Contraction (Downsell)*

Decrease in MRR without a complete termination. It can be caused by:

• a volume reduction (e.g. fewer users)
• a decrease in unit price
• a discount applied to an existing subscription

Customer count growth*

Breakdown that helps understand how your customer base evolves over a given period:

• Gain: new customers won over the observed period
• Reactivation: customers reactivated over the observed period
• Churn: customers lost following a cancellation

Active customer*

Customer with at least one active subscription and generating MRR > 0.

Terminated customer*

Customer whose subscriptions have all expired or been canceled, and whose MRR has dropped to 0.

D

Currency*

Multi-currency aggregation into the target currency. Fincome lets you aggregate revenue in a target currency, with automatic adjustment according to exchange rates for multi-currency subscriptions (source: Open Exchange Rate).

E

Expansion (Upsell)*

Increase in MRR related to an existing subscription. It can come from:

• the addition of users or modules (volume expansion)
• an increase in unit price (price expansion)
• the end of a discount

F

FX (foreign exchange effect)*

Variation of the MRR related to exchange rate fluctuations. This movement is isolated in Fincome so as not to distort the operational analysis.

G

GRR (Gross Revenue Retention)*

Gross retention rate. This is the amount of money a company keeps from its current customer base. GRR does not take into account the MRR resulting from upsells, so it is capped at 100%.

[GRR] = ([MRR at start of period] − [Downsell] − [Churn]) ÷ [MRR at start of period]

L

Lifetime Value (LTV)*

Estimated amount a customer will spend on your product over the total anticipated duration of their subscription (renewals included). It lets you estimate the total value of each subscriber based on the revenue they will generate over their "lifetime". Since the total planned duration of the subscription is generally hard to observe, the LTV is estimated using ARPU and the churn rate.

[LTV] = [ARPU] ÷ [Average churn rate over the last 6 months]

LTV/CAC*

Ratio that compares a customer's lifetime value to the cost of acquiring them. The higher the ratio, the more a given customer generates long-term revenue exceeding their CAC, and the higher your direct profitability. As a general rule, a ratio ≥ 3x is considered the indicator of a sustainable business model.

LVR (Lead Velocity Rate)

Measures the monthly growth of qualified leads entering the pipeline, predicting future sales potential. A high LVR indicates strong top-of-funnel expansion and consistent pipeline growth.

[LVR] = ([Qualified leads this month] − [Qualified leads last month]) ÷ [Qualified leads last month] x 100

M

Monthly Recurring Revenue (MRR)*

Predictable recurring revenue that will be generated by your active subscriptions over the following month. MRR takes into account the average amount of each subscription normalized over a monthly period. For example, an annual subscription with a total amount of €1,200 translates into a €100 contribution to the MRR.

[MRR] = [Number of active subscriptions] x [Average subscription amount normalized over a monthly period]

Future MRR*

Projection of the MRR over the coming months, calculated from active and planned subscriptions. Used to visualize the revenue trajectory when changes are already scheduled.

Gross margin

Reflects the percentage of revenue that exceeds the cost of goods sold (COGS), showing the company's operational efficiency.

[Gross margin] = ([Revenue] − [COGS]) ÷ [Revenue] x 100

Billed amount*

Total amount of revenue that was billed and collected over a given period. Analyzing the revenue collection cycle provides a better understanding of the intra-annual seasonality of cash, with a view to optimizing working capital.

MRR movements*

Breakdown of MRR growth over a given period, detailing the main variations:

• New: MRR generated by acquired customers
• Reactivation: MRR generated by previously churned or paused customers who were reactivated
• Attrition (Churn): MRR lost due to lost customers
• Expansion (Upsell): incremental MRR generated by an increase in the subscription price, in the number of subscribed products/plans, or in users
• Contraction (Downsell): MRR lost due to a decrease in the subscription amount, in the number of subscribed products/plans, or in users
• Foreign exchange impact (FX): variation of the MRR due to exchange rate fluctuations

N

Number of active subscribers*

Sum of all customers who have an active subscription at a given moment. This indicator lets you precisely track the number of customers currently generating recurring revenue and the growth of your customer base.

New (New business)*

First subscription activated for a customer with no active MRR in the previous month.

NRR (Net Recurring Revenue)*

Net retention rate indicating the growth or contraction of revenue from existing customers, taking into account churns and upsells.

[NRR] = ([MRR at start of period] − [Downsell] − [Churn] + [Upsell]) ÷ [MRR at start of period]

P

Service period*

Period during which a subscription gives access to a service.

Pricing plan*

Offer or product sold as a subscription. Each plan has a price, a frequency (monthly, annual…), and a billing logic

Pipeline Coverage

Measure of the value of the sales pipeline's opportunities relative to the revenue targets, with a coverage ratio of 3:1 considered ideal for hitting the targets.

[Pipeline Coverage] = [Total Pipeline Value] ÷ [Revenue Target]

R

Reactivation*

Resumption of a subscription by a previously churned customer (with no active MRR). Generates a positive movement in the retention analysis.

Churn recognition*

Setting that defines when a termination is taken into account in the MRR:

• At the request date: the MRR is removed as soon as the customer notifies their intention to terminate, even if the service continues to be provided until the contractual term
• At the effective date: the drop in MRR is recorded on the day the subscription actually drops to €0 in the billing system (often the monthly/annual due date)
• At the end of the service period: the churn is recognized when the customer is no longer served; for an annual subscription paid in advance, the MRR remains recorded until the last day covered by the invoice

Recognized revenue*

Amount of revenue generated by your company over a given period, generally a month or a year. Revenue is split into two parts:

• Recurring revenue: revenue recognized for all your active subscriptions over a given period. Revenue from subscriptions covering a period longer than one month is smoothed over the duration of the subscription and recognized according to the number of days in the selected period. This notion therefore differs from MRR, which is the sum of the monthly amounts of all subscriptions active at a given moment
• Non-recurring revenue: sum of all billed items that are not related to subscriptions (one-off items, setup fees, etc.) over a given period

Cash runway

Number of months before your company runs out of cash, based on your average cash consumption over the previous months. Average cash consumption is a measure of the amount of cash consumed by your company over a given period. It is calculated:

• on a gross basis ([Gross burn] = sum of all cash outflows over a given period)
• and on a net basis ([Net burn] = sum of all cash outflows and inflows, excluding financing-related inflows, for example a fundraising, over a given period)

[Cash runway (in months)] = [Current cash balance] ÷ [Net or gross cash burn]

S

Segment*

Group of customers filtered according to criteria (plan, country, channel, etc.). Used to perform targeted analyses or track a specific subset.

SaaS Quick Ratio*

Ratio between the MRR gained and the MRR lost over a period. A ratio greater than 1 confirms that the company is growing.

[SaaS Quick Ratio] = ([New MRR] + [MRR Expansion]) ÷ ([Churn MRR] + [MRR Contraction])

SaaS Magic Number

Assessment of the impact of sales and marketing investments on revenue growth.

[SaaS Magic Number] = ([Current quarter revenue] − [Previous quarter revenue]) x 4 ÷ [Previous quarter sales and marketing expenses]

Sales Velocity

Measures the daily revenue potential of the current pipeline, taking into account the number of opportunities, the average value of each deal, the conversion rate, and the length of the sales cycle.

[Sales Velocity] = ([Number of opportunities] x [Average deal value] x [Win rate]) ÷ [Sales cycle]

T

Churn rate*

Percentage of MRR or customers lost over a given period. Several variants are available in Fincome (customer churn, churn in value, net churn).

[Churn rate] = [MRR lost] ÷ [MRR at start of period]

Revenue growth rate*

Tracking of the percentage increase in revenue over a given period, serving as a direct indicator of the company's growth.

[Revenue growth rate] = ([Revenue this period] − [Revenue last period]) ÷ [Revenue last period] x 100

W

Win Rate

Percentage of opportunities won relative to the total, reflecting sales effectiveness and performance. A rate of 20-30% is common; anything above 30% is considered strong.

[Win Rate] = [Closed won deals] ÷ [Revenue deals target] x 100

Updated on: 03/07/2026