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The Metrics Investors Actually Track (Even If You Don't)
Founders love to talk about MRR, customer logos, and growth charts. But most VCs? They're looking at an entirely different scorecard. If you've ever left a pitch thinking, "That went great!"—only to be ghosted days later—it's often because you were showing one set of numbers, and they were waiting for another.
The truth is, what founders think of as "strong traction" doesn't always translate to investor interest. Especially in vertical SaaS, where nuance, capital efficiency, and operational clarity matter as much as revenue growth. This isn't about impressing investors—it's about understanding how they evaluate risk, return, and readiness. So let's walk through the metrics that matter—and how to make them work for you.
June 22, 2025
Sales Efficiency (The Quiet Test of GTM Discipline)
You might be growing, but are you doing it efficiently? Sales Efficiency measures how much new ARR you generate per dollar spent on sales and marketing. A strong ratio tells investors you're scaling responsibly—not recklessly.
According to Bessemer's Cloud 100 benchmarks, elite SaaS companies maintain a sales efficiency score above 0.8—meaning every dollar of GTM spend returns at least 80 cents in ARR within the same year (Bessemer Venture Partners, 2025).
Low sales efficiency isn't always fatal—but it signals a GTM model that hasn't found its rhythm yet.
0.8+
Elite Sales Efficiency
Benchmark for top-performing SaaS companies
$1
GTM Spend
Should generate at least $0.80 in ARR
CAC Payback Period (Are You Recovering Fast Enough?)
1
Customer Acquisition
Initial investment to acquire customer
2
Recovery Period
Time to recoup acquisition costs
3
Profitability
Customer becomes profitable
Customer Acquisition Cost (CAC) Payback Period tells investors how long it takes you to recoup the cost of acquiring a customer. If it takes more than 18–24 months to recover CAC, it raises red flags about cash flow, pricing power, or churn risk (OpenView Partners, 2024).
Vertical SaaS founders often underestimate this metric. You may have sticky customers, but if onboarding is complex or expansion is slow, your payback timeline may be too long for VC appetite.
Net Dollar Retention (The Ultimate Confidence Signal)
Net Dollar Retention (NDR) shows whether existing customers are growing with you—or quietly churning out. Top-tier SaaS companies have NDR rates over 110%—meaning upsells and expansions more than offset any revenue losses (Affinity, 2025).
This is the most predictive metric of long-term value, especially for Series A and beyond. VCs know they can fuel what's already working—so weak NDR makes even strong new sales look unstable.
110%
Elite NDR
Benchmark for top-performing SaaS companies
100%
Break-even
Expansions equal churn
90%
Warning Zone
Losing more than you're expanding
Gross Margin (They Want High-Quality Revenue)
Not all revenue is created equal. If your Gross Margin is below 60% in SaaS, it signals infrastructure or support burdens that might limit future scalability (SaaS Capital, 2025).
Elite SaaS
High-margin, scalable revenue
Good SaaS
Healthy margins with room to improve
Minimum Threshold
Investor warning threshold
Vertical SaaS often includes more services or onboarding than other models—but investors still expect healthy software margins. Know your true gross margin. Separate services from product. Show where efficiency gains will come from over time.
Burn Multiple (How Efficiently Are You Spending Capital?)
Burn Multiple = Net burn / Net new ARR. It tells investors how much you're spending to grow. A Burn Multiple below 2 is considered healthy in today's venture climate. Anything above that needs strong justification—and a clear path to improvement (S&P Global, 2025).
"Growth at all costs" isn't the default anymore. Affinity's 2025 Investment Benchmark Report shows that investors are gravitating toward companies that balance growth with capital stewardship (Affinity, 2025).
1
Burn Multiple < 1
Exceptional capital efficiency. You're generating more ARR than you're burning.
2
Burn Multiple 1-2
Healthy range. You're spending responsibly to fuel growth.
3
Burn Multiple > 2
Warning zone. Your growth is becoming increasingly expensive.
Capital Efficiency Is the New Growth Narrative
2021 Approach
Flashy revenue graphs and growth at all costs
2025 Reality
Showing how each dollar compounds and creates sustainable value
In 2021, you could raise with flashy revenue graphs. In 2025, you raise by showing how each dollar compounds. You don't need to be perfect—but you do need to show that you understand the metrics investors care about. That you've mapped a path to profitability or at least to sustainable scale.
This is especially critical for vertical SaaS founders. Your TAM might be narrower. Your CAC might be higher. So your ability to tell a smart efficiency story becomes your differentiator.
How to Start Measuring What Matters
Audit your internal scorecard
Do you track CAC payback? NDR? Sales efficiency? If not—start now.
Benchmark with intention
Don't compare your niche SaaS to horizontal giants. Use vertical SaaS benchmarks (like those from Bessemer, OpenView, and SaaS Capital) to ground your narrative.
Build your narrative from metrics
Show investors how these numbers tie into GTM, pricing, ops, and product strategy.
Track
Implement systems to consistently measure the right metrics
Analyze
Understand what your metrics reveal about your business model
Present
Frame your metrics in ways investors understand and value
Final Thought
Investors aren't ignoring you because you lack traction. They're often passing because the traction isn't framed in a way they can evaluate.
Learning the metrics they care about isn't about pandering—it's about alignment. If you're asking someone to write a multi-million dollar check, they need to know you're tracking the same signals they are.
It's not about impressing investors—it's about understanding how they evaluate risk, return, and readiness.
References
Affinity. (2025). The 2025 Investment Benchmark Report. https://www.affinity.co/report/the-2025-investment-benchmark-report
Bessemer Venture Partners. (2025). The Cloud 100 Benchmarks Report. https://www.bvp.com/atlas/the-cloud-100-benchmarks-report
OpenView Partners. (2024). SaaS Benchmarks. https://openviewpartners.com
SaaS Capital. (2025). SaaS Financial Benchmarks. https://www.saas-capital.com/benchmarking/
These resources provide comprehensive benchmarks and industry standards for SaaS metrics that investors track. Review them to better understand how your company compares to industry averages and expectations.