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SaaS & Startupadvanced

Viral Coefficient

Definition

The average number of new users each existing user generates. A viral coefficient above 1 means exponential growth without any paid acquisition.

Why it matters

A viral coefficient of exactly 1 means every user brings one new user and growth is linear. Above 1 and growth is exponential. Below 1 and you must supplement organic sharing with paid acquisition to sustain growth.

Example

On average, each of your users refers 0.7 new users who sign up. Your viral coefficient is 0.7. You need paid channels to compensate. If you improve referral mechanics to 1.1, growth becomes self-sustaining.

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