A collection of terms commonly used in the Software-as-a-Service domain

The average recurring cost to operate a service.

The value of a given subscription agreement per annum.

The total monthly revenue divided by the number of customers.

Similar to
Average Revenue per User
but excluding free accounts.

The probability that a given customer will cancel his or her subscription within a given time frame.
In practical terms, this works out to the number of cancellations during a given period divided by
the total number of customers at the beginning of that period.

The total amount spent to produce a product which is then sold to customers. In a SaaS business this
may include product development, operation, and support costs.

The total cost of all sales and marketing expenses divided by the number of customers added.

The total revenue collected for all services provided to a given customer over the complete term of
a business relationship.

A tool representing the minimal amount of functionality required to begin the process of validated learning
with real customers.

The amount of revenue which is either predicted, in the case of monthly subscriptions, or contracted or
committed, in the case of term subscriptions.

A model for software delivery that delivers functionality on demand via a web browser or other thin client.