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Ted Levi Toldman's avatar

Great article.

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CJ Gustafson's avatar

Thanks for reading glad you got value from it

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Brian H's avatar

Thanks CJ, great article. Curious why NRR wins out over GRR?

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CJ Gustafson's avatar

My top two retention metrics are net dollar retention to show customer expansion over time and gross account retention to show on an absolute basis (regardless of spend) which customers are sticking around. Both help you manage different aspects of retention. One on the dollar side and one on the account side. At the end of the day though they are all helpful cuts

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Brian H's avatar

100%. I am a CS guy by trade so I am curious to see how finance experts weigh in. I was speaking to a company last week where gross was 70 and net was close to 100, yikes!

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CJ Gustafson's avatar

those are some strong signals if they are b2b. for b2c not terrible

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Brian H's avatar

B2B :/. It was an interview for a role on their CS team....lots of red flags and this was a big one for me.

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Nicki Gustafson's avatar

Hey CJ

What charity are you sponsoring this month?

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CJ Gustafson's avatar

We are sponsoring Cure SMA, which provides support to patients and families affected by spinal muscular atrophy and funds and directs research leading the way to a cure for SMA.

Thanks for your support!

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Daniel Barnes's avatar

Fantastic write up CJ, a lot of value for folks here.

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Nicki Gustafson's avatar

That is a great organization! Love your philanthropy!

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Wyatt's avatar

Thanks, CJ - very helpful. What is the specific formula for burn multiple?

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CJ Gustafson's avatar

It’s EBITDA / Net new ARR

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Wyatt's avatar

What does EBITDA tell you about cash burn though? I figured it would be (total opex + COGS) / NNARR

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CJ Gustafson's avatar

EBITDA is a proxy for cash burn in this situation, but I get what you mean, it's not true cash burn because it's still related to gaap revenue

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