Series A Metrics: What Investors Actually Want to See

# Series A Metrics: What Investors Actually Want to See

You've built something meaningful. Your product has early traction. Now comes the critical question: **Are you ready for Series A?**

The answer isn't "do you have growth?" It's "do you have the *right* growth demonstrated through the *right* metrics?"

In our work with pre-Series A startups, we've noticed a pattern. Founders obsess over vanity metrics—total users, pageviews, revenue—while completely missing the metrics that actually move investor needles. This disconnect costs founders money, negotiating power, and sometimes entire rounds.

This guide walks you through exactly which **series a preparation** metrics matter, why they matter, and how to present them convincingly. We're not talking theory here. We're talking about what we see Series A investors actually scrutinizing in due diligence.

## The Investor Mindset: Understanding What Metrics Communicate

Before we list specific metrics, understand this: investors are trying to answer one fundamental question: **"Does this team have a sustainable, repeatable, scalable business model?"**

Metrics are just evidence for that argument. A vanity metric might show activity. But the *right* metrics prove repeatability and predictability—the hallmarks of a fundable business.

When we prepare founders for Series A fundraising, we help them think like investors. What would you want to see before writing a $2-5M check? Not hopeful assumptions. Not best-case projections. Actual data showing the business works.

## Core SaaS Series A Metrics

If you're a B2B SaaS company, Series A investors will zero in on these non-negotiable metrics:

### Monthly Recurring Revenue (MRR) and Growth Rate

MRR is the foundation. But here's what matters more: **your MRR growth rate**.

Investors want to see consistent month-over-month growth. The benchmark for Series A readiness typically hovers around 10-15% MRR growth month-over-month, though this varies by market and segment. Some high-growth categories (AI-enabled tools, for example) see expectations closer to 20%.

But consistency beats speed. A company with 8% predictable month-over-month growth raises more easily than one jumping from 2% to 25% to 5%. That volatility suggests you don't understand your growth engine.

Track this religiously. Not just the number—the trend. Create a simple spreadsheet showing 12 months of historical MRR. Include forward projections (though be conservative; we recommend 15% monthly growth in projections for a B2B SaaS company targeting Series A).

### Customer Acquisition Cost (CAC) and Lifetime Value (LTV)

This is where we see most founders stumble. They calculate CAC and LTV, but they calculate them *wrong*.

CAC should include *all* acquisition costs—salaries, tools, paid ads, everything—divided by the number of customers acquired. Many founders forget to include fully-loaded payroll for their sales team. That's a costly mistake.

LTV requires understanding your true customer lifespan. Not "we hope customers stay 3 years." Actual data from paying customers still active. If you're pre-PMF or very early, you won't have this data yet. That's okay. But you need to be honest about it.

The golden ratio investors watch: **LTV:CAC of at least 3:1**. This signals that for every dollar you spend acquiring a customer, you make $3 back. Below 3:1 and your growth isn't economically sustainable.

For a deeper dive into these unit economics, see our guide on [SaaS Unit Economics: A Complete Guide to CAC, LTV & Growth](/blog/saas-unit-economics-a-complete-guide-to-cac-ltv-growth/).

### Churn Rate

This metric separates funded companies from seed-stage startups.

Series A investors expect monthly churn below 5-7% for most B2B SaaS. Enterprise SaaS can sustain slightly higher churn. Low-touch, product-led growth should show even lower churn.

Here's the uncomfortable truth we share with founders: if your churn is above 10%, you have a retention problem that no amount of fundraising fixes. You're pouring money into a leaky bucket. Fix retention first.

We've worked with founders who delayed Series A rounds specifically to improve churn. Smart move. It's easier to improve churn when you're lean and hungry than to explain high churn to a Series A investor.

### Net Revenue Retention (NRR)

This is the metric that separates great SaaS companies from good ones.

NRR measures revenue from existing customers month-over-month, accounting for churn and expansion. An NRR above 100% means your existing customer base is growing (through upsells and expansions) even without new customer acquisition. An NRR of 120% is exceptional and signals strong product-market fit.

Calculate it: (Beginning MRR + Expansion MRR - Churned MRR) / Beginning MRR × 100

If you can't calculate NRR, you don't have enough data yet. And that's often fine for early Series A. But if you do have this data and it's above 110%, lead with it. It's a magic metric.

## Metrics Beyond SaaS: What Non-SaaS Founders Need

If you're building in e-commerce, marketplace, B2C, or other models, the metrics shift but the principle remains: show sustainable, repeatable unit economics.

### Marketplace and E-Commerce Metrics

**Gross Merchandise Value (GMV) or Gross Revenue** with growth rate—same logic as MRR, but measured differently.

**Take Rate**: What percentage of transactions do you capture? Series A investors want to see stable take rates showing predictable unit economics. A take rate that jumps from 15% to 25% to 10% signals pricing instability or margin pressure.

**Customer Acquisition Cost and Repeat Purchase Rate**: Unlike SaaS, you need to show customers come back. A 40% repeat purchase rate with sustainable CAC is compelling for Series A.

### Consumer App Metrics

**Daily Active Users (DAU) and Monthly Active Users (MAU)** with growth trends—but focus on *engaged* users, not total downloads. The ratio of DAU to MAU tells the story of engagement.

**Retention Cohorts**: Show that users from month 1 are still active in month 3, 6, and 12. This proves the product has stickiness.

**Session Length and Frequency**: If sessions are getting shorter or less frequent, you have a problem.

## The Meta-Metrics: What Smart Investors Track

Beyond specific product metrics, Series A investors analyze derived metrics that prove your business model is sound:

### Payback Period

How long does it take to recoup the CAC from a customer's LTV? For SaaS, under 12 months is good. Under 6 months is excellent.

A long payback period means you're burning significant cash to grow. That's a risk in Series A when investors are betting on your team and product, not your cash reserves.

### Burn Rate and Runway

Here's where honesty matters. Series A investors *know* startups burn cash. They don't expect profitability. But they expect:

1. **Accurate burn calculation**: We've seen founders dramatically underestimate burn by excluding stock options, benefits, or contractor costs. Be precise. [Review our guide on cash flow calculation](/blog/the-cash-flow-trap-why-your-runway-calculation-is-probably-wrong/) if yours seems off.

2. **Runway alignment with fundraising timeline**: If you raise $2M with $200K monthly burn, you have 10 months. But Series A fundraising takes 3-6 months. You should raise when you have 12-18 months of runway, not 6 months.

3. **Improving unit economics**: Your burn rate should be declining as a percentage of revenue as you grow. If burn is increasing while revenue grows, you have a scaling problem.

### Magic Number (SaaS Specific)

Magic Number = (MRR Growth × 3) / Sales & Marketing Spend

A Magic Number above 0.75 shows efficient growth. Above 1.0 is outstanding. This metric proves your customer acquisition model is actually working at scale, not just in early days with friendlies.

## How to Present Metrics: The Formatting That Wins

Metrics are only valuable if they tell a clear story. We've reviewed hundreds of Series A pitches, and poor presentation kills compelling metrics.

### Create a One-Page Metrics Dashboard

Don't bury metrics in a 40-slide deck. Create a single, visual summary showing:

- Current MRR/Revenue
- Month-over-month growth rate
- MRR growth trend (12-month chart)
- Key unit economics (CAC, LTV, LTV:CAC ratio)
- Churn
- Payback period
- Runway

Make it clean. Use consistent formatting. Let the data breathe. Investors should understand your metrics in 30 seconds.

### Tell the Story with Data

Each metric should answer a specific question investors ask:

- **Is the business growing?** → MRR growth, GMV growth
- **Is growth sustainable?** → Churn, NRR, retention cohorts
- **Are unit economics sound?** → CAC, LTV, LTV:CAC, payback period
- **Will this company be large?** → Total addressable market (TAM) + growth trajectory
- **Can you execute?** → Improving metrics month-over-month

Connect each metric to a narrative point. Don't just show the numbers. Explain what they mean.

### Include Historical Context

Forecast 12 months into the future, but show 12 months in the past. This demonstrates track record. If you've been consistent with your growth projections, Series A investors gain confidence you understand your business.

If your actual metrics diverged from projections, own it. Explain why. Investors respect founders who acknowledge misses and explain what they learned.

## Common Metrics Mistakes at Series A

In our experience preparing founders for Series A, we see these errors repeatedly:

### 1. Using Gross Revenue Instead of MRR

You might have $500K in gross revenue but only $30K MRR because you're delivering annual licenses upfront or have significant refunds. This matters. MRR shows what you're actually retaining.

### 2. Ignoring Cohort Analysis

Cohort analysis shows whether each new customer cohort is better or worse than the last. If month 1 cohorts churn at 8% but month 12 cohorts churn at 15%, you have a problem—your product, onboarding, or positioning is degrading.

### 3. Cherry-Picking Time Periods

We've seen founders show "our best three months" and ignore the rest. Investors look at full-year trends. Inconsistency will be discovered in due diligence. Don't waste time.

### 4. Projecting Unrealistic Growth

A founder with 10% monthly growth projecting 20% is not being ambitious—they're being dishonest. Use historical data to inform projections. Conservative projections you beat are more compelling than aggressive ones you miss.

### 5. Forgetting Category Context

Not all metrics are equal across categories. A B2B SaaS company and a consumer app have completely different expectations. Know your category benchmarks. This is where having a fractional CFO helps—we can advise based on hundreds of companies we've worked with.

## Preparing Your Metrics: The Series A Checklist

1. **Calculate MRR, growth rate, and 12-month history** ✓
2. **Analyze CAC, LTV, and LTV:CAC ratio** ✓
3. **Measure churn and NRR** ✓
4. **Build cohort analysis** ✓
5. **Calculate payback period** ✓
6. **Determine accurate burn rate and runway** ✓
7. **Calculate Magic Number (if SaaS)** ✓
8. **Create visual metrics dashboard** ✓
9. **Prepare narrative explaining each metric** ✓
10. **Stress-test projections against historical data** ✓

## When to Get Help With Metrics

If you're uncertain about any of these calculations, that's a signal. Series A investors will ask detailed questions about how you derived metrics. If you can't defend the numbers confidently, investors lose trust.

We regularly help founders audit their metrics before Series A. It's shocking how often we find errors—sometimes favorable, often not. Better to discover and fix them before the pitch meeting than during due diligence.

If you've raised a seed round via [convertible notes or SAFEs](/blog/safe-notes-vs-convertible-notes-a-founders-guide/), you likely have some founder-friendly investors already. Ask them if your metrics pass the smell test. They'll give you honest feedback.

## The Bottom Line: Metrics as Your North Star

Series A preparation isn't about gaming metrics or finding the story you want to tell. It's about understanding your actual business performance deeply enough that you can explain it confidently.

The best founders we work with treat metrics not as something for investor decks, but as their actual operating system. They check MRR weekly. They understand cohort trends monthly. They know their unit economics intuitively.

When metrics are that central to how you run the company, they become authentic. And authentic metrics backed by a founder who truly understands the business? That's what moves Series A investors to write checks.

Start measuring now. Build the discipline of understanding these metrics deeply. By the time you're ready to fundraise, they'll feel like second nature—because they'll be based on real data, real history, and real understanding of your business.

---

## Ready to Prepare for Series A?

Metrics are just one piece of Series A readiness. From financial modeling to due diligence preparation to understanding what your cap table should look like, the details matter.

At Inflection CFO, we've helped dozens of startups prepare for successful Series A rounds. We'll audit your metrics, stress-test your financial model, and ensure you're walking into investor meetings fully prepared.

**[Book a free financial audit with our team](#contact)** to identify gaps in your Series A preparation and get specific recommendations for your stage and situation.