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A short guide to key metrics for quarterly/monthly investor reporting

Help! I’ve got my seed funding and now my investors want to know everything! Sound familiar?

At GrowthBuilders we work with a lot of companies and founders who have just received their first round of funding. Founders who, after the initial excitement of securing the much needed investment to grow their business, are suddenly entering the brave new world of investor oversight. Because with funding, invariably comes reporting.

For many founders this is the first time they have been asked to provide any kind of

formal, regular update on how their business is doing. Up until this point many founders have managed their business through their online bank account. Whilst they are very clued up on cash flow and monthly sales targets, they aren’t sure what else they are going to be required to measure and report.

Plus there’s a lot of conflicting advice on what’s important, which can be confusing and exhausting. So, here is our short guide to the key metrics (and acronyms) that founders need to focus on for their monthly or quarterly investor reporting.

Cash burn and cash runway

Probably familiar terms to any founder, but not necessarily something that is formally tracked and monitored. Investors will want to know what your cash runway is i.e. how long you can survive and where their money is being spent. Your monthly cash burn rate is calculated as:

Closing cash balance in prior month - cash balance for the current month

Cash burn rate can be calculated on a gross basis (excluding any sales receipts) or a net basis (including sales receipts) but the important thing is to be consistent.

Your cash runway is how long your cash balance will fund the business at the current burn rate. The main aim for most scale-ups is to get cashflow positive or secure the next funding round before the cash runs out!


Annual and Monthly Recurring Revenue (ARR/MRR) are both key metrics for any SaaS or subscription based business and a real focus for investors. Investors will use it to monitor a business’ expansion, contraction and how effective marketing activities have been in influencing new wins. Against this, these metrics will be used to track client numbers, churn and retention rates. And, most importantly for both founders and investors, these numbers will ultimately influence the exit value. Make sure you know these numbers and have them front of mind for any investor conversation.

The reference point is key to this metric. For instance, if you record MRR when you close an opportunity in your CRM this will help to motivate your sales team but may mislead investors because there will be a delay in recognising the revenue in the books as it takes time to sign the deal and start the service. As such, recording MRR at the service start date or invoice date would be more prudent. Again, the key here is to be consistent and clearly define where the data has come from and how the metric has been calculated.


Customer Acquisition Cost (CAC) and Average Customer Value (ACV) might be less familiar, these acronyms are important as they are an indication of how much it is costing the business to win a new customer or piece of work. Investors will want to monitor these ratios to ensure that the sales team are not spending more in winning a client than they are worth to the business either on an annual basis or on a lifetime basis. Investors will monitor these two metrics closely and will consider the ratio of CAC:ACV to assess whether the cash invested is being spent in the right way.

Customer Lifetime Value (LTV)

This metric is key to understand for any subscription based business. However, it can be very difficult to accurately measure in the early days as you need to understand the client retention rate and how many times a customer will renew their subscription / licence. However, it is a useful metric when assessing the customer acquisition cost and how much time and money the business invests in winning and retaining a customer. This cost should not be more than the lifetime revenue that the customer will bring in otherwise the business is not viable.

Customer numbers

Understanding your customer acquisition rate, retention rate and churn rate is key to any business. Tracking the number of new customers, lost customers or upsells will be crucial to assessing the success of any sales and marketing activities. When linked to the above metrics you can understand if the growth in MRR / ARR is due to new customers won or upsells, both of which are key to driving growth.

Create a dashboard of your customer subscription metrics so you know when customers are due to renew or who is on a free trial so you can direct your attention to securing their business. Having the data can direct your discussions and help you identify or understand trends in the business or customer satisfaction which need your attention.

Profit margin

In the early stages of your business, making a profit may seem like a distant target. However, tracking gross profit margin and net operating profit margin is important to understand if you have control over your costs. Understanding the margin per customer can also be useful in assessing if the business is scaleable or if you need to drive further efficiencies before you ramp up sales and marketing efforts.

Return on capital employed (ROCE)

This is a profitability ratio that measures how efficiently a company is using its capital to generate profits. This is more important for later stage companies but it is considered to be one of the best measures of profitability and is commonly used by investors when making a decision whether a company is suitable to invest in.

ROCE = Earnings before interest and tax (EBIT)

(total assets - current liabilities)

ROCE tells you how much operating profit is generated for every pound invested in the business.

If you are a founder who has just received your first round of seed funding and are in the position of having to manage investors for the first time, then we can help.

We start by running a free financial health check in which we will analyse how you are managing your finances and provide some quick tips on what you can do immediately. Then we put in place a reporting system that takes the worry out of how, what and when you need to report to investors. Get in touch now for a chat about how to run your business in a way that will keep your investors happy :)

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