business-health-diagnostic

name business-health-diagnostic argument-hint [metrics or business context] description Diagnose SaaS business health across growth, retention, efficiency, and capital. Use when preparing a business review or prioritizing urgent fixes. intent Diagnose overall SaaS business health by analyzing growth, retention, unit economics, and capital efficiency metrics together. Use this to identify problems early, prioritize actions by urgency, and deliver a comprehensive health scorecard for board meetings, quarterly reviews, or fundraising preparation. type interactive theme finance-metrics best_for ["Getting a complete read on your SaaS business health across all dimensions","Identifying which metrics are red flags vs. leading indicators","Preparing for a board meeting or investor review"] scenarios ["Our growth is strong but we're burning cash fast — I need to understand our unit economics before the board meeting","I'm preparing for a Series A board meeting and need to assess our business health across growth, retention, and efficiency"] estimated_time 20-30 min Purpose Diagnose overall SaaS business health by analyzing growth, retention, unit economics, and capital efficiency metrics together. Use this to identify problems early, prioritize actions by urgency, and deliver a comprehensive health scorecard for board meetings, quarterly reviews, or fundraising preparation. This is not a single-metric check—it's a holistic diagnostic that connects revenue, retention, economics, and efficiency to reveal systemic issues and opportunities. Input Works best with: Whatever business metrics you have access to — growth rate, NRR/GRR, CAC payback, burn multiple, runway. Partial data is fine; the diagnostic flags what's missing. Also useful: The occasion (board meeting, quarterly review, fundraise prep) and what you already suspect is wrong. Anything supplied with the invocation itself — text after the skill name, a pasted context dump, or an appended ARGUMENTS: line — counts as answers already given. Use it and skip whatever it covers; don't re-ask. Arriving empty-handed? That works too. The diagnostic opens by asking your company stage and which metric families you can pull. Example invocation: Run a health check: $8M ARR, 60% YoY growth, NRR 96%, CAC payback 21 months, 14 months runway — board meeting in 3 weeks. Key Concepts The Business Health Framework A SaaS business is healthy when four dimensions work together: Growth & Retention — Are you growing and keeping customers? Revenue growth rate NRR (Net Revenue Retention) Churn rate Quick Ratio Unit Economics — Is the business model profitable at the customer level? CAC (Customer Acquisition Cost) LTV (Lifetime Value) LTV:CAC ratio Payback period Gross margin Capital Efficiency — Are you using cash efficiently? Burn rate Runway Rule of 40 Magic Number Strategic Position — Are you positioned for sustainable success? Market positioning (below, at, above market pricing) Competitive moat (network effects, data, brand) Revenue concentration risk Operating leverage Stage-Specific Benchmarks Early Stage (Pre-$10M ARR): Focus: Product-market fit, unit economics Growth: >50% YoY LTV:CAC: >3:1 Gross Margin: >70% Runway: >12 months Acceptable: Negative margins, high burn (if unit economics work) Growth Stage ($10M-$50M ARR): Focus: Scaling efficiently Growth: >40% YoY NRR: >100% Rule of 40: >40 Magic Number: >0.75 Acceptable: Moderate burn if growth is strong Scale Stage ($50M+ ARR): Focus: Profitability, efficiency Growth: >25% YoY NRR: >110% Rule of 40: >40 Profit Margin: >10% Required: Positive or near-positive cash flow Red Flag Categories Critical (Fix immediately): Runway <6 months LTV:CAC <1.5:1 Churn accelerating cohort-over-cohort NRR <90% Magic Number <0.3 High Priority (Fix within quarter): Rule of 40 <25 Payback >24 months Quick Ratio <2 Gross margin <60% Revenue concentration >50% in top 10 customers Medium Priority (Address within 6 months): NRR 90-100% (flat, not growing) Magic Number 0.3-0.5 Operating leverage negative Churn rate stable but high (>5% monthly) Anti-Patterns (What This Is NOT) Not a single metric: "Revenue is growing 50%, we're great!" (ignoring burn, churn, unit economics) Not stage-agnostic: Early-stage burn is acceptable; scale-stage burn is a problem Not static: Health is directional—are metrics improving or degrading? Not just numbers: Context matters (competitive pressure, market changes, team capacity) When to Use This Framework Use this when: Preparing for board meetings or investor updates Quarterly business reviews (QBR) Fundraising preparation (know your numbers) Annual planning (identify improvement areas) You suspect problems but can't pinpoint them New PM/exec joining and needs health assessment Don't use this when: You're pre-revenue (focus on product-market fit first) You're in pure research mode (not enough data) You need tactical guidance (use specific skills: feature, channel, pricing) Facilitation Source of Truth Use workshop-facilitation as the default interaction protocol for this skill. It defines: session heads-up + entry mode (Guided, Context dump, Best guess) one-question turns with plain-language prompts progress labels (for example, Context Qx/8 and Scoring Qx/5) interruption handling and pause/resume behavior numbered recommendations at decision points quick-select numbered response options for regular questions (include Other (specify) when useful) This file defines the domain-specific assessment content. If there is a conflict, follow this file's domain logic. Application This interactive skill asks up to 4 adaptive questions , then delivers a comprehensive diagnostic with prioritized recommendations. Step 0: Gather Context Agent asks: "Let's diagnose your business health. I'll need metrics across four dimensions: growth, retention, unit economics, and capital efficiency. Company context: Stage: (Pre-$10M ARR, $10M-$50M ARR, $50M+ ARR) Business model: (PLG, sales-led, hybrid) Target market: (SMB, mid-market, enterprise, mixed) Why this matters: Benchmarks vary by stage. Early-stage optimizes for growth; scale-stage optimizes for efficiency. Please provide the following metrics. Use 'unknown' if you don't have a metric." Step 1: Growth & Retention Metrics Agent asks: " Growth & Retention: Revenue: Current MRR or ARR: $___ Revenue growth rate: ___% (MoM or YoY) Retention: Monthly churn rate: ___% NRR (Net Revenue Retention): ___% Quick Ratio: ___ (or I can calculate it) Expansion: Expansion revenue as % of total MRR: ___% Cohort trends: Are recent cohorts retaining better or worse than older cohorts? Better (improving) Same (stable) Worse (degrading) Unknown" Based on answers, agent evaluates: ✅ Healthy growth: Growth >40% YoY (growth stage) or >25% (scale stage) ✅ Healthy retention: NRR >100%, churn <5% monthly, Quick Ratio >2 🚨 Growth problems: Growth <20% YoY 🚨 Retention problems: NRR <100%, churn >5%, cohort degradation Step 2: Unit Economics Metrics Agent asks: " Unit Economics: Acquisition: CAC (Customer Acquisition Cost): $___ Blended or by channel? (If by channel, what's your best channel CAC?) Value: LTV (Lifetime Value): $___ LTV:CAC ratio: ___ (or I can calculate it) Payback period: ___ months (or I can calculate it) Margins: Gross margin: ___% Contribution margin (if known): ___% Trends: Is CAC increasing, stable, or decreasing over time? Decreasing (improving efficiency) Stable Increasing (diminishing returns) Unknown" Based on answers, agent evaluates: ✅ Healthy economics: LTV:CAC >3:1, payback <12 months, gross margin >70% ⚠️ Marginal economics: LTV:CAC 2-3:1, payback 12-18 months 🚨 Poor economics: LTV:CAC <2:1, payback >24 months, gross margin <60% Step 3: Capital Efficiency Metrics Agent asks: " Capital Efficiency: Cash: Cash balance: $___ Monthly net burn rate: $___ Runway: ___ months (or I can calculate it) Efficiency ratios: Rule of 40: ___ (Growth % + Profit Margin %) (or I can calculate it) Magic Number: ___ (S&M efficiency) (or I can calculate it) Operating expenses: S&M as % of revenue: ___% R&D as % of revenue: ___% Is OpEx growing faster than revenue? No (positive operating leverage) Yes (negative operating leverage) Unknown Profitability: Profit margin: ___% Path to profitability: (already profitable, 6-12 months, 12-24 months, >24 months, unknown)" Based on answers, agent evaluates: ✅ Healthy efficiency: Rule of 40 >40, magic number >0.75, runway >12 months ⚠️ Acceptable efficiency: Rule of 40 25-40, magic number 0.5-0.75, runway 6-12 months 🚨 Poor efficiency: Rule of 40 <25, magic number <0.5, runway <6 months Step 4: Deliver Comprehensive Diagnostic Agent synthesizes all metrics and delivers: Overall Health Score — Healthy / Moderate / Concerning / Critical Dimension Scores — Growth, Retention, Economics, Efficiency Red Flags — Critical, High Priority, Medium Priority Prioritized Recommendations — Top 3-5 actions with expected impact Stage-Appropriate Benchmarks — How you compare to peers Diagnostic Pattern 1: Healthy Business When: Growth, retention, economics, and efficiency all meet stage-appropriate benchmarks No critical red flags Improving trends Output: "## ✅ Overall Health: Healthy Your business shows strong fundamentals across all dimensions. Health Scorecard Dimension Score Status Growth & Retention ✅ Healthy Growth ___% YoY, NRR ___%, Churn ___% Unit Economics ✅ Healthy LTV:CAC ___:1, Payback ___ months Capital Efficiency ✅ Healthy Rule of 40: ___, Runway ___ months Overall ✅ Healthy Strong position for scaling Key Strengths [Specific strength 1] Metric: [e.g., NRR 120%] Why it matters: [Expanding within base without new logos] [Specific strength 2] Metric: [e.g., LTV:CAC 5:1] Why it matters: [Sustainable unit economics support scaling] [Specific strength 3] Metric: [e.g., Rule of 40 = 65] Why it matters: [Excellent balance of growth and efficiency] Opportunities for Optimization Even healthy businesses can improve. Here are your top opportunities: 1. [Opportunity 1] Current: [e.g., Magic Number 0.9] Opportunity: [Could scale S&M spend 2x and maintain efficiency] Impact: [+$___ MRR/month] 2. [Opportunity 2] Current: [e.g., Expansion revenue 15% of total] Opportunity: [Build upsell paths, target 25% expansion revenue] Impact: [NRR 110% → 120%] 3. [Opportunity 3] Current: [e.g., CAC $500, stable] Opportunity: [Improve conversion, reduce CAC to $400] Impact: [Faster payback, better LTV:CAC] Recommended Actions (Next Quarter) Priority 1: Scale what's working [e.g., Double content marketing budget (best channel)] Expected impact: [+___ customers/month, +$___ MRR] Priority 2: Expand within base [e.g., Launch premium tier for 20% of customers] Expected impact: [NRR 110% → 115%] Priority 3: Improve efficiency [e.g., Optimize paid acquisition (reduce CAC 10%)] Expected impact: [Payback 8mo → 7mo] Monitor These Metrics Weekly: NRR (should stay >___%) Churn rate (should stay <___%) Quick Ratio (should stay >___) Monthly: Rule of 40 (should stay >___) Magic Number (should stay >___) LTV:CAC (should stay >___:1) Quarterly: Cohort retention trends Revenue concentration risk Operating leverage Benchmarks (Your Stage: [Growth/Scale]) Metric Your Performance Benchmark Status Growth Rate ___% >40% (growth) / >25% (scale) ✅ NRR ___% >100% ✅ LTV:CAC ___:1 >3:1 ✅ Rule of 40 ___ >40 ✅ Gross Margin ___% >70% ✅