Simple Revenue Metric Tree
A simple metric tree breaking down revenue into typical B2B SaaS components of new business, expansion, contraction, and churn.
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Problem
No single source of truth for key company metrics. Metrics housed in multiple dashboards.
Solution
Map metrics into a hierarchical tree in order to visualize how they interact with each other to drive growth.
Impact
Cross-functional alignment on metrics. Ability to pinpoint growth problems and opportunities. Easily tie changes back to revenue.
Your Company Has No Idea Where ARR Actually Comes From
Your CEO asks in the leadership meeting: "ARR grew $120K last quarter. Great. But where did that come from?"
Someone says: "New deals."
Someone else says: "I think expansion too."
Your CFO starts pulling up spreadsheets. Check Stripe for subscription data. Pull HubSpot for contract deals. Cross-reference with that manual tracking sheet for upgrades and downgrades. Add up cancellations. Subtract contractions.
Twenty minutes later: "Looks like $180K from new business, $60K from expansion, minus $90K from churn and $30K from downgrades. So net $120K."
Everyone nods. Meeting continues.
But here's what nobody asked: Is that new business mostly subscriptions or contracts? Is expansion coming from plan upgrades or license additions? Are we losing more to downgrades or outright cancellations? Which components are trending up or down?
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