What is a KPI (key performance indicator)?

A KPI (key performance indicator) is a measurable value used to evaluate how effectively a business is achieving its goals. Financial KPIs help businesses monitor performance, identify trends, and make informed decisions.

Example: A startup tracks monthly recurring revenue (MRR), burn rate, and gross margin as key performance indicators.

Related terms: Forecasting, Burn Rate, Gross Margin, Investor Reporting