
Aggregate measures of engagement such as DAU/MAU provide a limited lens for understanding depth of engagement. A better practice is to observe the full distribution of depth of engagement. This is also true when considering the distribution of revenue generation where ACV is also a limit…
…tire distribution of contract values which gives us more nuanced information than just the average. We typically encapsulate such an analysis by stating that X% of the revenue stream is subject to a downturn in startup-driven spending vs. Y% that will survive because it’s coming from high quality customers.
… fashion are generally higher quality customers because they are more likely to survive a downturn. The customers on the right end of the revenue distribution are the flagship customers who are getting a lot of value from the product and would likely continue being customers in a weaker macro environment. For enterprise startups it’s often the case that small customers with low contract values are other…