Been digging into the Rule of 40 lately for SaaS metrics.
Wondering how others are using it to balance growth vs profitability.
Seems like it could add a new perspective to our usual KPIs and decision-making process.
Rule of 40 is useful, but don’t get hung up on it. Focus on what drives real growth.
For most apps, I’d prioritize retention and user LTV over arbitrary benchmarks. Those metrics directly impact revenue and profitability.
If you’re above 40%, great. If not, look at why. Are you overspending on low-quality users? Is your product sticky enough?
Use it as a guideline, not a hard target. Sometimes you need to sacrifice short-term profits for long-term market share. Just make sure you can justify the spend.
I’ve used Rule of 40 as a sanity check, but it’s not the whole picture.
For mobile apps, I care more about retention and ARPU. Those tell me if people actually like and use the app enough to pay.
Rule of 40 can flag issues, but digging into user behavior is where the real insights are. It’s a starting point, not an end goal.
Used it for a while, but found it too simplistic for app growth.
Instead, we started tracking a combo of CAC payback period, retention cohorts, and feature adoption rates. Gives us a clearer picture of sustainable growth.
Rule of 40 can mask problems. Had an app hitting 45% but bleeding users after month 2. Looked great on paper, disaster in reality.
Now we use it as a quarterly sanity check, not a daily driver. Helps spot red flags, but the real gold is in user-level data and behavior patterns.
If you do use it, pair it with qualitative feedback. Numbers alone don’t tell the whole story.
Tried it. Honestly not worth the hassle for small apps.
It’s okay for a quick check. But user retention and revenue per user matter more for apps. Those numbers tell you if people actually like it.