2026 Data
SaaS Metrics Benchmarks
How does your SaaS company stack up? Top quartile, median, and bottom quartile benchmarks for the metrics VCs care about most.
| Metric | Top Quartile | Median | Bottom Quartile | Context |
|---|---|---|---|---|
| ARR Growth (Seed → A) | 3x+ YoY | 2x YoY | <1.5x YoY | Series A requires $1-3M ARR growing 2-3x |
| ARR Growth (A → B) | 2.5x+ YoY | 2x YoY | <1.5x YoY | Series B requires $5-15M ARR growing 2x+ |
| Net Dollar Retention | 130%+ | 110-120% | <100% | Best-in-class: 130-150% (Snowflake, Datadog) |
| Gross Retention | 95%+ | 85-90% | <80% | Below 80% signals product-market fit issues |
| Gross Margin | 80%+ | 70-75% | <60% | Software should be 75%+; services drag it down |
| Burn Multiple | <1x | 1-2x | >3x | Burn multiple = net burn / net new ARR |
| Rule of 40 | 60%+ | 30-40% | <20% | Growth rate + profit margin should exceed 40% |
| CAC Payback | <12 months | 12-18 months | >24 months | Under 12 months is efficient; >24 is concerning |
| LTV/CAC Ratio | 5x+ | 3-4x | <2x | Below 3x means unit economics need work |
| Magic Number | >1.0 | 0.5-0.75 | <0.5 | Net new ARR / prior quarter S&M spend |
Frequently Asked Questions
What SaaS metrics do VCs care about most?
ARR growth rate is #1. Then net dollar retention (proves product stickiness), gross margin (proves software economics), and burn multiple (proves capital efficiency). At Series A, growth trumps everything. At Series B+, efficiency metrics matter more.
What ARR do I need for Series A?
$1-3M ARR growing 2-3x year-over-year is the current benchmark. Some AI companies raise Series A pre-revenue, but most SaaS companies need to demonstrate product-market fit through revenue traction.
What is a good burn multiple?
Under 1x is excellent (you're spending less than $1 to generate $1 of net new ARR). 1-2x is acceptable for growth stage. Over 3x is a red flag — you're burning too much capital relative to growth.