The SaaS Financial Model projects your business forward from a small set of assumptions. It's the tool to reach for when an investor asks "what does this look like in two years?"
Three tabs
- Dashboard — headline outputs: ending ARR, customers, EBITDA, and LTV\:CAC, plus charts of the trajectory.
- Income Statement — the month-by-month table behind those numbers. Hover any column heading for a definition.
- Inputs & Assumptions — everything you control.
The assumptions that matter
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Initial ARR and initial customers — where you're starting from today. Together they imply your average revenue per customer, which drives the whole projection.
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Monthly growth rate — the share of your customer base you add each month. Be careful here: 10% monthly is 3.1× a year, which is aggressive for most companies. Model what you can defend.
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Churn rate — the share of customers who cancel each month. This is the assumption founders most often set too low. Use your real number if you have one, even if it's ugly.
Cohort retention is available as an alternative. A single flat churn rate assumes a customer who joined last week is exactly as likely to leave as one who has stayed two years, which is never true. Switch to cohort retention and you set a first-month churn rate (high) and a mature churn rate (low); churn then decays from one toward the other as each cohort ages. Flat churn stays the default, so existing models are unchanged until you opt in.
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Expansion rate — extra revenue from existing customers upgrading. Strong expansion is what lets good SaaS companies grow while churning.
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Projection months — how far out to model. 24 months is the usual ask.
Costs and hiring
Costs are entered as a percentage of revenue: COGS, sales & marketing, R&D, and G&A. Percentages rather than fixed amounts means they scale with the projection automatically.
The hiring plan is separate and absolute: add a role, a headcount, an average monthly cost, and the month they start. Use fully-loaded cost — salary plus taxes, benefits, and tooling — not just salary. Hires are added to expenses from their start month onward.
Reading the outputs
- LTV:CAC — lifetime value against acquisition cost. Above 3 is generally considered healthy; below 1 means you lose money on every customer you win.
- EBITDA — profitability before interest, taxes, and depreciation. The month it turns positive is your break-even point, and it's a number worth knowing by heart.
The metrics investors ask for
A row of five tiles sits under the headline outputs:
- Rule of 40 — annualised ARR growth percentage plus EBITDA margin percentage. 40 or above is the bar; it's the standard way of saying "grow fast or be profitable, ideally some of each."
- NRR (net revenue retention) — what happens to your existing base without new customers: expansion minus churn. Above 100% means the customers you already have are worth more each month, which is the single strongest signal in SaaS.
- Magic number — a quarter's net new ARR divided by the previous quarter's sales and marketing spend. Above 0.75 is considered efficient growth; well below it means you're buying revenue expensively.
- CAC payback — months of gross profit needed to earn back what a customer cost to acquire. Under 12 months is healthy for a company funding its own growth.
- Break-even — the first month EBITDA turns positive, or "not in range" if it doesn't inside your projection.
Each tile shows green when it clears the conventional bar and amber when it doesn't.
Scenario comparison
A bear / base / bull table sits below. Your entered numbers are the base case. Bear halves your growth rate and raises churn by 50%; bull does the reverse. Only those two assumptions are flexed, deliberately — moving every input at once produces a spread nobody can interpret.
The useful discipline is checking that you'd survive the bear case, not admiring the bull one.
Exporting
Export CSV gives you every projected month with readable column names — Beginning MRR, Net new MRR, Ending ARR, EBITDA, and the rest — ready to drop into a spreadsheet or a data room.
A word on assumptions
Every projection is wrong; the useful ones are wrong in ways you can explain. Investors rarely challenge the arithmetic — they challenge the growth and churn rates. Being able to say why you chose yours matters more than the size of the final number.
The Inputs & Assumptions tab flags the ones most often set to numbers a founder can't defend: growth that compounds implausibly, churn low enough to be best-in-class, zero churn (which makes LTV infinite), churn high enough to outrun growth, gross margins low for software, and cost percentages that sum past revenue so the model can never reach profitability. They're prompts to check your reasoning, not errors.
Pair this with the P&L calculator for what actually happened, and the burn rate calculator for how long you have.