business-health-diagnostic

## Purpose Diagnose overall SaaS business health by analyzing growth, retention, unit economics, and capital efficiency metrics together. Use this to identify problems early, prioritize actions by urgency, and deliver a comprehensive health scorecard for board meetings, quarterly reviews, or fundraising preparation. This is not a single-metric check—it's a holistic diagnostic that connects revenue, retention, economics, and efficiency to reveal systemic issues and opportunities. ## Key Concepts ### The Business Health Framework A SaaS business is healthy when four dimensions work together: 1. **Growth & Retention** — Are you growing and keeping customers? - Revenue growth rate - NRR (Net Revenue Retention) - Churn rate - Quick Ratio 2. **Unit Economics** — Is the business model profitable at the customer level? - CAC (Customer Acquisition Cost) - LTV (Lifetime Value) - LTV:CAC ratio - Payback period - Gross margin 3. **Capital Efficiency** — Are you using cash efficiently? - Burn rate - Runway - Rule of 40 - Magic Number 4. **Strategic Position** — Are you positioned for sustainable success? - Market positioning (below, at, above market pricing) - Competitive moat (network effects, data, brand) - Revenue concentration risk - Operating leverage ### Stage-Specific Benchmarks **Early Stage (Pre-$10M ARR):** - Focus: Product-market fit, unit economics - Growth: >50% YoY - LTV:CAC: >3:1 - Gross Margin: >70% - Runway: >1...