Subscription KPIs

There are dozens of metrics you could track. Most subscription businesses track too many and act on too few. This page groups the KPIs that actually drive decisions into four categories: revenue, retention, efficiency, and payment health. The last group is the one most dashboards miss.

Revenue KPIs

Revenue metrics tell you how fast you're growing and where the growth comes from. MRR is the foundation. Everything else builds on it. ARR is MRR annualised, and it's the number your board and investors will reference most often. But the more useful breakdown sits underneath: net new MRR shows your real month-over-month trajectory, expansion MRR tells you whether existing customers are growing, and contraction MRR shows where they're shrinking.

In practice, net new MRR is the single number that best captures momentum. If it's consistently positive, most other things are working.

Retention and churn KPIs

Growth means nothing if you can't keep what you've won. Churn rate measures the percentage of customers or revenue you lose each period. Retention rate is its mirror. Both matter, but make sure you're tracking them separately for revenue and logos. Revenue churn weights losses by value, which gives a more honest picture than logo retention alone. A company losing fifty $10 accounts and zero enterprise deals looks very different depending on which metric you read first.

Efficiency KPIs

Customer lifetime value paired with CAC tells you whether your unit economics work. The SaaS magic number measures sales efficiency quarter over quarter. The SaaS quick ratio compares growth inputs (new and expansion MRR) against losses (churn and contraction), and a ratio above 4 is generally considered healthy. Revenue per employee is a blunter instrument, but it's useful for benchmarking operational efficiency as you scale.

These metrics are most valuable when tracked together over time. Any one of them in isolation can mislead.

Payment health KPIs

Here's the thing: most subscription dashboards don't include payment health at all, and that's a blind spot. Payment failure rate measures what percentage of renewal charges fail on the first attempt. Industry averages sit between 5% and 10% of all subscription charges. Involuntary churn tracks the customers you lose purely because a payment couldn't be collected, not because they wanted to leave.

We've found these two KPIs surface recoverable revenue that other metrics simply categorise as lost. A company with 7% payment failure rate and no dunning automation is leaving real money unrecovered every month. Tracking these numbers is the first step to fixing them.