Bessemer Efficiency Score (BVPES)

Date created: Apr 7, 2021  •   Last updated: Jan 25, 2022

What is Bessemer Efficiency Score?

Bessemer Efficiency Score is a measure of capital efficiency that tracks net new ARR against net burn for a given period. This metric showcases the incremental ARR dollars added for every dollar of burn, effectively measuring a company’s spending habits.

Alternate names: BVP Efficiency Score

Bessemer Efficiency Score Formula

ƒ Sum(Net New ARR) / Sum(Net Burn)

How to calculate Bessemer Efficiency Score

A company records $1 million in net new ARR and $600K net burn in a given year, resulting in a Bessemer Efficiency Score of 1.7x. This indicates that the company’s capital efficiency has reached the “best” range of scores.

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What is a good Bessemer Efficiency Score benchmark?

According to Bessemer Venture Partners, the best Bessemer Efficiency Score is greater than 1.5x, with “better” companies falling in the range of 0.5-1.5.

Bessemer Efficiency Score benchmarks

Bessemer Efficiency Score

Bessemer Efficiency Score
Bessemer Venture Partners, 2019
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How to visualize Bessemer Efficiency Score?

The best way to visualize your Bessemer Efficiency Score is with a summary chart. This capital efficiency metric is usually displayed as a single number. It may help to compare it to a previous time period to view changes in value.

Bessemer Efficiency Score visualization example

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Bessemer Efficiency Score

2X

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1.05

vs previous period

Summary Chart

Here's an example of how to visualize your current Bessemer Efficiency Score data in comparison to a previous time period or date range.
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Bessemer Efficiency Score

2.49X

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1.09

vs previous period

Summary Chart

Here's an example of how to visualize your current Bessemer Efficiency Score data in comparison to a previous time period or date range.

More about Bessemer Efficiency Score

Bessemer Efficiency Score, also known as BVP Efficiency Score, is a measure of capital efficiency that was devised by Bessemer Venture Partners. Track this metric to have an objective way of looking at your capital efficiency.

While it’s great to generate revenue, it’s important to look at revenue as a return on capital expenditure. Bessemer Efficiency Score enables you to do this by looking at your Net New ARR as a multiple of Net Burn. You can then track this number against the benchmark to determine if you need to improve your capital efficiency.

Bessemer Efficiency Score Frequently Asked Questions

Why should you track Bessemer Efficiency Score?

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The BVP Efficiency Score is a great metric to measure how sustainable your cash burn is. Essentially, this metric tells you how well you would do in times of hardship or emergencies.

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