Ltv stands for lifetime value and Cac stands for the customer acquisition cost. VCs expect that a customer generates at least 3 times what it cost you to acquire him (it’s a minimum).

This ratio mixes many aspects from sales and marketing efficiency to your ability to keep users (linked to product quality and customer support). As a consequence, there are many ways to optimize this ratio and just looking at the “raw result” won’t give you many insights.

Churn is one of the most coveted and analyzed SaaS metrics on the internet so I won’t go into details here but just share this table by Tomasz Tunguz: 

You can probably be even more demanding for the Enterprise segment and expect a 0–0.5% monthly customer churn (and you generally measure Enterprise churn on a yearly basis rather than monthly).

The 40% rule is that your growth rate + your profit should add up to 40%. So, if you are growing at 20%, you should be generating a profit of 20%. If you are growing at 40%, you should be generating a 0% profit. If you are growing at 50%, you can lose 10%. If you are doing better than the 40% rule, that’s awesome.

What's a Good or Bad North Star? 

• Bad: Mostly measuring price paid as opposed to value delivered • MRR, paid seats

 • Good: Measures value delivered in bulk • MAU, DAU, messages sent

 • Better: Unquestionably indicates Product-Market fit has been reached with the customer • Number of users with L28>=16 • Messages sent w/in 30 days of signup.