Committed Monthly Recurring Revenue (CMRR) Defined

Committed Monthly Recurring Revenue Chart

What is Committed Monthly Recurring Revenue (CMRR)? Committed monthly recurring revenue (CMRR) is a forward-looking SaaS metric that combines actual monthly recurring revenue (MRR) data with known bookings and churn data.  It begins with your existing MRR (say, last month’s recognized MRR), adds known new bookings, and subtracts known cancellations and downgrades. For businesses who […]

The SaaS P&L Explained – Where Metrics and Margins are Born

SaaS P&L Explained

You can’t manage a SaaS business by only using the standard financial statements.  To really understand the underlying economics of your business, you must have a properly structured “software” or SaaS P&L (Profit and Loss Statement). You must also calculate the relevant SaaS metrics and margins for your business.  The SaaS P&L Explained “infographic” below […]

What the SaaS Magic Number of One is Not Telling You

SaaS Magic Number

Why the SaaS Magic Number of One is So Lonely The SaaS Magic Number is a sales-related SaaS metric that determines your efficiency in generating incremental recurring revenue.  In the SaaS community, a SaaS Magic Number of 1 or greater is considered ideal, but should you really pour more money into sales and marketing if […]

So you want to jump on the subscription pricing bandwagon?

Subscription pricing band wagon

Switching From One-time Sales to Subscription Pricing Subscription pricing has become an extremely popular revenue model these days.  It seems like any product or service such as wine, tea, cosmetics, or HVAC maintenance can be purchased via a subscription.  One-time sales seem to be a thing of the past. You can’t blame businesses for jumping […]