U3 CAPITAL NETWORK GLOSSARY
Plain-language terminology for SaaS and software founders, buyers and investors. Definitions are designed to support clearer private-market conversations. Technical, legal, tax, engineering and transaction meanings can vary by agreement, reporting standard and jurisdiction.
EBITDA adjusted for identified items intended to better represent normalized operating performance; the appropriateness of adjustments depends on the facts and transaction.
The annualized value of contracted recurring revenue under a stated methodology.
The annualized value of recurring subscription revenue, commonly used to describe the scale of a subscription software business.
A reference point used for comparison, such as a market metric, transaction observation, operating statistic or pricing indicator.
The rate at which a company consumes cash over a stated period.
The loss of customers or recurring revenue over a period of time.
An annualized recurring-revenue measure that may include contracted recurring revenue not yet fully reflected in current ARR; definitions vary by company.
A company selected for comparison because relevant business, financial, market or operating characteristics may be similar; comparability is a matter of judgment.
A prior transaction used as market context because relevant characteristics may be similar to the opportunity being considered.
The cost associated with acquiring a new customer, calculated according to the company's chosen methodology.
The degree to which revenue or cash flow depends on a relatively small number of customers.
A controlled repository used to organize and share confidential diligence materials with authorized parties.
Cash proceeds received by a founder or shareholder from selling part or all of an ownership interest.
Cash proceeds received by a founder or shareholder from selling part or all of an ownership interest.
Revenue remaining after specified direct costs, expressed as an amount or percentage under the company’s accounting methodology.
The percentage of recurring revenue retained from an existing customer base before expansion revenue, according to the company's measurement method.
The percentage of recurring revenue retained from an existing customer cohort before expansion revenue, under the stated methodology.
Capital intended to support expansion rather than solely provide shareholder liquidity.
A non-binding range generated from stated information, benchmarks and assumptions for preliminary discussion; it is not an offer, appraisal or formal valuation.
An estimate of the economic value generated by a customer over the customer relationship; calculation methods vary.
The percentage of customers or accounts lost during a period, distinct from revenue churn.
A U3CN engagement tool that uses supplied information and stated assumptions to generate an illustrative scenario or market range for preliminary discussion.
Recurring subscription revenue expressed on a monthly basis.
A recurring-revenue retention measure closely related to net revenue retention, reflecting expansion, contraction and churn within an existing customer cohort.
A measure of recurring revenue retained from an existing customer cohort after contractions, churn and expansions, according to the company's measurement method.
Earnings adjusted for identified non-recurring, owner-specific or unusual items to support analysis of ongoing operating performance.
Revenue that repeats under subscriptions, contracts, maintenance relationships or other continuing arrangements.
The percentage of recurring revenue lost during a period before or after specified expansion effects, depending on the methodology.
A SaaS heuristic that commonly compares growth rate plus a profitability or cash-flow margin, with methodology varying by analyst.
The estimated time a company can continue operating before available cash is exhausted under stated assumptions.
A comparison showing how an output changes when one or more assumptions are changed.
Potential paths considered by a company or its shareholders, which can include raising capital, recapitalizing, partnering, acquiring, selling part of the company or pursuing a full exit.
The total contracted value expected over the stated term of a customer agreement, subject to its terms.
The most recent twelve-month period used to summarize revenue, earnings, payments or another operating measure.
A pricing model in which customer charges vary with measured product or service usage.
A ratio used to relate an observed or assumed value to a financial or operating metric such as revenue or EBITDA.
Software designed primarily for the workflows or needs of a specific industry or market vertical.
Use the U3CN Master Glossary or return to the SaaS & Software section.