What is Magic Number?
A SaaS sales-efficiency rule of thumb: the quarterly revenue increase times 4 (annualized net new ARR) divided by prior-quarter sales and marketing spend. Above about 0.75 is commonly read as efficient; below about 0.5 as inefficient.
Where you will use it: this term comes up in the Entrepreneurial Finance course, and the full course glossary collects every term in one place.
Related terms
From the free Entrepreneurial Finance course by Devon Coombs, CPA, MBA.