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Glossary

Growth & SaaS
Glossary

Plain-English definitions of the metrics, frameworks, and acronyms that actually matter for developer-first growth.

By Daria Dovzhikova · Updated May 2026

15 terms

Annual Recurring Revenue (ARR)

Metrics

The total amount of recurring revenue that a SaaS business expects to receive annually from its current customer base, calculated by multiplying Monthly Recurring Revenue (MRR) by 12.

Related:MRRRevenueSubscription

Customer Acquisition Cost (CAC)

Metrics

The total cost of acquiring a new customer, including all sales and marketing expenses divided by the number of customers acquired in a given period.

Related:LTVUnit EconomicsMarketing

Customer Lifetime Value (LTV)

Metrics

The predicted net profit attributed to the entire future relationship with a customer, typically calculated as average revenue per user times gross margin divided by churn rate.

Related:CACChurnRevenue

Monthly Recurring Revenue (MRR)

Metrics

The amount of recurring revenue that a business can expect to receive every month from its current subscribers or customers.

Related:ARRRevenueGrowth Rate

Churn Rate

Metrics

The percentage of customers who stop using a service during a given time period, calculated as (customers lost / total customers at start) × 100.

Related:RetentionLTVMRR

Product-Market Fit (PMF)

Strategy

The degree to which a product satisfies strong market demand, often measured through customer retention, growth rate, and user satisfaction metrics.

Related:Market ResearchProduct DevelopmentCustomer Validation

Conversion Rate Optimization (CRO)

Optimization

The systematic process of increasing the percentage of website visitors who complete a desired action, such as signing up for a trial or making a purchase.

Related:A/B TestingLanding PagesFunnel

Product-Led Growth (PLG)

Strategy

A go-to-market strategy where the product itself is the primary driver of customer acquisition, conversion, and expansion.

Related:FreemiumSelf-ServeProduct-Market Fit

North Star Metric

Strategy

A single metric that best captures the core value your product delivers to customers and drives sustainable business growth.

Related:KPIsOKRsGrowth Metrics

Expansion Revenue

Revenue

Additional revenue generated from existing customers through upselling, cross-selling, or increasing usage of the product.

Related:UpsellingCustomer SuccessNet Revenue Retention

Activation Rate

Metrics

The percentage of new users who complete key actions that indicate they've experienced the core value of your product during their initial usage period.

Related:OnboardingTime to ValueUser Journey

A/B Testing

Optimization

A controlled experiment methodology where two versions of a webpage, app, or feature are compared to determine which performs better for a specific goal.

Related:ExperimentationStatistical SignificanceConversion Rate

Cohort Analysis

Analytics

A behavioral analytics technique that groups users based on shared characteristics or experiences within a defined time period to track their behavior over time.

Related:User RetentionLifetime ValueBehavioral Analytics

Freemium Model

Strategy

A pricing strategy where basic product features are provided free of charge, while advanced features require a paid subscription.

Related:Product-Led GrowthConversion FunnelMonetization

Net Promoter Score (NPS)

Metrics

A customer satisfaction metric that measures the likelihood of customers to recommend your product to others, scored from -100 to +100.

Related:Customer SatisfactionCustomer LoyaltyProduct-Market Fit

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