Saas Metrics

How to view your key SaaS metrics in Good Sign

SaaS metrics provide Good Sign users quick view on some key financial metrics of a SaaS company, based on data stored in and generated by Good Sign. It shows the development of both number of customers and recurring revenue over selected time period. 
SaaS metrics is accessible from Reports menu.

Required user rights

• 3260 Menu - SaaS Metrics
• 3262 Menu - SaaS Metrics Accounts

How to use SaaS Metrics

MRR/ARR and Time frame selection

On the top of the screen there are few settings that affect what data is shown in the charts. 

Metric dropdown specifies if the charts show monthly recurring revenue (MRR, default value) or annual recurring revenue (ARR). Annual recurring revenue is calculated by multiplying monthly revenue of a specific month by 12. 

Period is a quick selection for time frame shown on the charts. Selected period's start and end date are shown after the period dropdown. You can use the start date and end date selectors directly to specify the time frame of the charts. In that case you have to click refresh icon, and please note that Period dropdown is not synced any more. 

Charts

On the top there are two line charts: Recurring revenue and Number of Customers. They simply visualize the development of both recurring revenue and number of customers.
Under the line charts are two waterfall charts which give you more detail on where the change between two months originates from. 

Recurring revenue chart categorizes the change between customers whose invoicing has increased and customers whose invoicing has decreased. Increase could be increased usage, upsell, or because it's a completely new customer. Decrease could happen due to decreased usage, downsell, or when an organization seizes to be a customer.
Number of customers chart divides the change into new customers and churned (lost) customers.

Sometimes it's possible that "the big number", whether it's total revenue or total number of customers, might look like it has not changed that much. But these waterfall charts can show you that actually there is lot of changes but negative changes (churn, reduced usage) nullify the positive changes (new sales, increased usage). Once you have detected this, you have a chance to react and make corrective actions. Invoice monitoring and different dashboards of Good Sign provide you additional insights and details.

For more details, see chapter How charts are populated.

Organization tree

In addition to the settings on the top, the organization tree on the left affects the charts. Only the selected organization in the tree and organizations under it in the same branch are included in the charts. For example, you could filter the chart to show only one sales organization's customers or customers in one country. Note! The actual structure of the tree depends on your organization's setup, so these examples may not be applicable.

How charts are populated

In this chapter it is described in more detail how the data is interpreted and the SaaS Metrics' charts are populated. 

Recurring Revenue

First of all, Recurring Revenue charts read data from the invoice lines. Only the invoice lines where the CR account is recurring revenue account are included. If the account settings have not been set, all invoice lines are included, which is typically not the preferred behavior. See Settings for more details.

Each invoice line has two date fields: Charge (Calldate) First and Charge (Calldate) Last. They 
typically define the time period which has been invoiced. The actual invoice may have been
generated and delivered outside this period. Charge Calldate First is used to determine the month in the recurring revenue charts. 

Example 1: SaaS base fee for January 2024 would be a separate invoice line in an invoice, and have values 2024-01-01 and 2024-01-31 in Charge Calldate First and Charge Calldate Last respectively. The invoice is created and sent in the beginning of January, let's say 2024-01-05. Invoiced amount would be shown as recurring revenue for January 2024. 

Example 2: Usage or consumption based service or add-on is invoiced in arrears once the actual usage is known. Again the consumption for January 2024 would have 2024-01-01 and 2024-01-31 in Charge Calldate First and Charge Calldate Last, but it is invoiced in February. The invoiced amount would be shown as recurring revenue for January 2024, but would not be shown on the chart before the actual invoice and invoice lines were generated as before that the usage and therefore invoicing would have been unknown. 

Recurring Revenue waterfall chart

Recurring Revenue waterfall chart gives extra insight on why the revenue has changed between two months. Between two months the chart shows positive and negative bar representing the change from the first months' revenue to the second month's revenue. 

Each customer is analyzed separately and included either in the positive or negative change bar in the waterfall chart. All the customers who have been invoiced more than in the previous month, are included in the positive change bar. Reasons for this could be increased usage, upsell, or that it is a completely new customer. All the customers who have been invoiced less than in previous month, are included in the negative change bar. This could have happened due to decreased usage or cancellations. 

Example: Below is a small data set of invoicing of 4 different customers for 2 months, January and February. Chart would show 3500€ recurring revenue for January, and 4200€ for February. There would be a positive change bar of 1200€ (Customer A and C) starting from 3500€. Then there would be a negative change bar of 500€ (Customer B) starting from 4700€ (3500€ + 1200€) ending up on the same level as February's invoiced recurring revenue i.e. 4200€.

Number of customers

Number of Customers charts are based on contracts. Depending on your Good Sign setup, contracts may not be in use. In that case the charts will not show any data, but you can still benefit from recurring revenue charts.

If a customer has any contract in any day of a month, it is being considered as a customer for that specific month. This means that Contract valid from and Contract valid to fields are checked. [Known issue: also contracts in Draft status are counted here]

Example 1: Customer has one contract, which ends in 2024-01-15 (value of the Contract valid to field). Customer does not have any other contracts. Customer is included as a customer for January (despite the fact it was not customer anymore for the second part of January), but not for February.

Example 2: Customer has one contract, which ends in 2024-01-31. There's also another contract, which starts in 2024-02-01. Despite the end of the first contract, customer is included in both January and February in the charts.

Number of Customers waterfall chart

In a similar manner as in Recurring Revenue waterfall, the Number of Customer waterfall chart categorizes changes between two months to positive bar (new customers) and negative bar (churned customers).

Example: Customer contract ends in 2024-01-15, and there's no additional contracts for that
customer. This is a churned customer, and there will be a negative bar of size 1 from January to February. However, a new customer has been acquired, and their contract will start on 2024-02-01. This is a new customer, and there will be a positive bar of size 1 from January to February. The total number of customers remains the same, but the waterfall chart reveals that actually there has been both customer acquisition and churn.

Settings

By default, the charts show all invoicing as recurring revenue, which in most cases is not true. To show correct data, one has to select the recurring revenue accounts. Users with 3262 Menu - SaaS Metrics Accounts user right can make those selections from the tab SaaS Metrics Accounts.

Choose the right accounts from the Accounts list (you can filter the list by typing the name of the account) and press Save. The list underneath shows currently selected Accounts. You can deselect an account by removing it from the Accounts list and then saving.