Ryan DeissCo-Founder & CEO, The Scalable Company

What to track when your business is doing 8 figures in revenue.

12 Sept 2026 · 1 min

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In this concise monologue, Ryan Deiss argues that once a business reaches roughly $20 million in annual revenue, the most critical metric for CEOs to track is Revenue per Employee (RPE). He systematically compares RPE against other common performance indicators—gross margin, lifetime value (LTV), churn, customer concentration, conversion rate, net profit, and cash flow—showing that while each remains relevant, RPE becomes the primary lever because headcount rapidly becomes the largest expense at this scale. By optimizing RPE, a company can indirectly improve cash flow, profitability, and overall margins, making it the fastest‑acting control point for CEOs aiming to sustain growth and prepare for a potential exit.

Chapters

Is it gross margin or LTV? Still gross margin. LTV is starting to matter at $20 million though. Gross margin or churn? Gross margin. Gross margin or revenue per employee? Revenue per employee. At $20 million, your employees are probably your single biggest expense, and so if you want to know what your margins are, know your revenue per employee and optimize towards it. Your revenue per employee or your customer concentration? Revenue per employee. If you want to sell at $20 million, customer concentration really matters. Your revenue per employee or your conversion rate? Revenue per employee. You should know your conversion rate. Revenue per employee or net profit? Revenue per employee, because that's the one that you have the most control over as a CEO the fastest. Revenue per employee or cash flow? Revenue per employee, because if you've got that dialed in, your cash flow should take care of itself. So, is revenue per employee the most important metric at $20 million? It is, because at $20 million, that's when your headcount's gonna start to explode. And so if you don't have your RPE figured out, and if you're not optimizing it, it's gonna get away from you.