Quick Reference

PM Metrics Cheat Sheet

21 product management formulas, organized by category. Bookmark this page or use Ctrl+P to save as PDF.

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SaaS Economics

Customer Lifetime Value (LTV)

LTV = (ARPU x Gross Margin) / Churn Rate

3:1 or higher is Bessemer’s cloud LTV:CAC operating target, not an observed industry average. Bessemer: Scaling to $100 Million

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Customer Acquisition Cost (CAC)

CAC = Sales & Marketing Spend / New Customers

Bessemer targets CAC payback below 12 months for SMB, 18 for mid-market, and 24 for enterprise cloud sales. Bessemer: Scaling to $100 Million

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Monthly Recurring Revenue (MRR)

MRR = Sum of monthly subscription revenue

Median 2024 annual revenue growth was 25% in SaaS Capital’s Q1 2025 survey of over 1,000 private B2B SaaS companies. SaaS Capital 2025 growth report

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Churn Rate

Churn (%) = Customers Lost / Starting Customers x 100

Median annual customer retention was 65% for monthly plans at $250–500 monthly ARPA in ChartMogul’s 2024 data. This is annual retention, not monthly churn. ChartMogul 2025 report: sample and exclusions

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Prioritization

RICE Score

RICE = (Reach x Impact x Confidence) / Effort

Compare relative scores within backlog

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ICE Score

ICE = Impact x Confidence x Ease

All scored 1-10, higher = higher priority

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Weighted Scoring

Score = Sum(Criterion Score x Weight)

Normalize weights to 100%

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Kano Model

Functional + Dysfunctional questionnaire matrix

Survey classifications use paired responses; the web tool illustrates categories with ratings

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Impact/Effort Matrix

2x2 matrix: Impact (Y) vs Effort (X)

Review dependencies and strategic fit before choosing high-impact, low-effort work

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Statistical Testing

A/B Test Significance

Z = (p1 - p2) / sqrt(p(1-p)(1/n1 + 1/n2))

A 5% significance level is a common pre-specified convention

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Sample Size

n₀ = Z² x p(1-p) / E²

Survey proportion: Z is the confidence critical value; p and margin E are proportions. Apply finite-population correction when appropriate.

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A/B Test Planning

Duration = Sample per Variant / Daily Traffic per Variant

Plan the sample, usage cycle, and stopping rule before launch

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Net Promoter Score (NPS)

NPS = % Promoters (9-10) - % Detractors (0-6)

Software firms averaged 21.1 in Qualtrics’ 2024 U.S. consumer study. This is not a B2B SaaS benchmark. Qualtrics: 2024 NPS sample and method

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Growth & Engagement

Conversion Rate

CR = Conversions / Total Visitors x 100%

Unbounce’s 2024 landing-page sample had a 6.6% median conversion rate. Conversion events varied and were not necessarily purchases. Unbounce 2024 conversion report

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DAU/MAU Ratio

Stickiness = DAU / MAU

Compare products with the same expected usage frequency and active-user definition.

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Retention Rate

Cohort Retention (%) = Returning Cohort Users / Starting Cohort Users x 100

Compare the same cohort, qualifying activity, and return window

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Product-Market Fit Score

Composite score = weighted Sean Ellis result and supporting inputs

40%+ “very disappointed” is a Sean Ellis demand signal, not proof of PMF