Reference
Business Finance Glossary
Plain-language definitions of the metrics that matter for pricing, growth, and profitability — each with a formula and a worked example.
- Gross MarginRevenue minus cost of goods sold, expressed as a percentage of revenue.
- Break-Even ROASThe minimum return on ad spend needed to cover the cost of running an ad campaign.
- Customer Acquisition Cost (CAC)The total cost to acquire one new paying customer.
- Customer Lifetime Value (LTV)The total revenue a business expects from a customer over the entire relationship.
- Business RunwayHow long a business can operate at its current burn rate before running out of cash.
- Monthly Recurring Revenue (MRR)The predictable revenue a subscription business earns each month.
- Churn RateThe percentage of customers or revenue lost in a given period.
- Contribution MarginRevenue minus variable costs — the amount each unit contributes toward fixed costs and profit.