SaaS Quick Ratio: How efficient is your growth?


blog.chartmogul.comBack in February 2015, Social+Capital VC Mamoon Hamid unveiled SaaS Quick Ratio at the SaaStr Convention. Since then it’s been a hot topic, emerging as part of investors’ standard fundraising asks. So, we’ve put together everything you need to know about the metric, how (and when!) it’s helpful to a SaaS business, and other things to consider when using SaaS Quick Ratio.

Right off the bat, we need to clarify the term and its meaning. You might have heard of Quick Ratio before. Traditionally, “Quick Ratio” is a finance metric that gauges a company’s liquidity, or a company’s ability to pay off all current liabilities ASAP (aka the “Acid Test Ratio“). SaaS Quick Ratio is different. What the metrics have in common: they both give investors a snapshot of how promising — or risky — an investment may be. Let’s see how this new metric works for SaaS, specifically.




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