--- title: "Micro Blog: Quality Revenue Week 3" description: Quality Revenue Series (also published via weekly newsletter emails) image: https://labs.goldensection.com/hubfs/5-1.png --- [![GST_Logo_Horizontal_Gold-Navy No BG](https://labs.goldensection.com/hs-fs/hubfs/GST_Logo_Horizontal_Gold-Navy%20No%20BG.png?width=670&height=218&name=GST_Logo_Horizontal_Gold-Navy%20No%20BG.png "GST_Logo_Horizontal_Gold-Navy No BG")](https://goldensection.com) - [Golden Section](https://www.goldensection.com/) - [Resources](https://www.goldensection.com/frameworks) - [Partner with Us](https://www.goldensection.com/#contact) # Micro Blog: Quality Revenue Week 3 ![](https://cdn2.hubspot.net/hubfs/2040891/Marketplace/WASABI/icons/icon-calendar.svg) *By [Lauren Bahorich](https://labs.goldensection.com/author/lauren-bahorich) - December 02, 2019*   Today, [Lauren Bahorich](https://labs.goldensection.com/author/lauren-bahorich), Venture Partner with [GST](https://gstdev.com) shares with us how she and the GST team advise Growing B2B SaaS Companies to have regard for the Quality of Revenue sought.   ## Quality Revenue: Unit Economics We have been discussing the importance of a company pursuing growth in quality revenue rather than simply growth at any cost. In the wake of the We Work IPO meltdown, this conversation takes on new urgency. VCs and other institutional funders are refreshed in their pursuit of profitability and strong financials.  One of the metrics VC and PE firms examine closely to determine a company’s long-term health and profitability is its unit economics. A company’s unit economics indicates its ability to grow and become profitable in the future, even if that company is currently not turning much of a profit. And a company that focuses on producing strong unit economics is one that is increasingly becoming more efficient with its spending and resource allocation over time. LTV (Customer Lifetime Value) and CAC (Customer Acquisition Cost) are the two main components of Unit Economics. LTV expresses the total amount of revenue generated from one customer over the lifetime of that customer with your company. CAC expresses the amount of Sales & Marketing lift required to acquire one customer.   These numbers can be combined in the ratio, LTV : CAC, to compare the expected revenue from a customer with the cost to acquire him. The industry benchmark is an LTV:CAC ratio of 3:1. Additionally, you want to see this ratio decreasing over time as your company becomes more efficient with its go-to-market strategy. Over the next few weeks, we will be discussing factors to consider in your pursuit of high-quality revenue. As always, we love hearing from you as to what you're experiencing as you drive growth for your company; please reach out below. [We'd love to hear from you!](mailto:adam@gstdev.com)     ![GST042606](https://labs.goldensection.com/hs-fs/hubfs/GST042606.jpg?width=215&name=GST042606.jpg "GST042606") #### Actionable insight for seed and scaling B2B founders and teams ## Learn how to build a great company GST Labs is a community of experts in strategy, finance, technology, product, development, sales, and operations. The collaborators each have significant insight for B2B SaaS firms. Subscribe today to keep in the loop and get special access to world class content and tools. [![SUBSCRIBE](https://no-cache.hubspot.com/cta/default/5897825/8418736b-504f-4a0f-a4b4-81287143f0a4.png)](https://cta-redirect.hubspot.com/cta/redirect/5897825/8418736b-504f-4a0f-a4b4-81287143f0a4) ### Recommended For You Comments ### Subscribe to GST Labs We promise that we won't SPAM you. #### About GST Labs GST Labs delivers actionable, crisp insight for scaling B2B SaaS founders and teams from experts in a variety of disciplines including sales, operations, development, devops, support, training, customer success, and etc.  #### Recent news [**How and When to Raise Capital for Your Startup Business** 21 May 2021](https://labs.goldensection.com/when-should-i-raise-capital-for-my-business) [**The Most Efficient & Cost-Effective Way to Staff Your Startup Company** 17 March 2021](https://labs.goldensection.com/when-should-a-startup-bring-talent-in-house) [**How Tech Companies Can Prevent a SolarWinds Level Breach** 17 February 2021](https://labs.goldensection.com/how-tech-companies-can-prevent-a-solarwinds-level-breach) #### Subscribe #### Contact us ![GST_Primary_Logo-Horizontal_White-1](https://labs.goldensection.com/hs-fs/hubfs/GST_Primary_Logo-Horizontal_White-1.png?width=647&name=GST_Primary_Logo-Horizontal_White-1.png "GST_Primary_Logo-Horizontal_White-1") 808 Travis St, Suite 1406, Houston, Texas, 77002, USA Copyright © 2020 Golden Section Ventures, LLC dba Golden Section Technology. All rights reserved. [Privacy Policy](https://www.gstdev.com/privacy-policy)