SaaS Magic Number Calculator
Compute the SaaS Magic Number — the sales-efficiency metric that tells you whether to spend more or pull back on growth.
Quarterly Inputs
Magic Number
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Run to see Magic Number
Net new ARR (Q2 minus Q1)—
Magic Number—
Verdict—
The Bessemer rule of SaaS growth investment
Bessemer Venture Partners popularized the Magic Number rule: above 1.0, invest aggressively. Between 0.5 and 1.0, invest with discipline. Below 0.5, fix product-market fit before scaling. The Magic Number forces you to ask whether your last dollar of S&M produced enough net-new ARR to justify the next dollar.
Frequently Asked Questions
Quarterly or annual?
Quarterly is the standard. Annual smooths over too many fluctuations to be diagnostic.
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Riman Agency tunes SaaS marketing for healthy Magic Numbers.