What is
Cash Conversion Score
?
The Cash Conversion Score is a capital efficiency metric popularized by Bessemer Venture Partners. It measures how much Annual Recurring Revenue (ARR) a company generates for every dollar of 'Net Capital' (total capital raised minus the cash currently on hand) that has been invested in the business. Essentially, it tells you how much 'yield' the founders are getting from the venture capital they have spent. A score of 1.0x or higher is considered 'Good,' meaning the company has generated $1 in ARR for every $1 of VC money burned. A score of 1.5x+ is exceptional. This metric is more 'Macro' than the Burn Multiple because it looks at the entire history of the company's capital usage rather than just a single quarter. It prevents founders from hiding historical inefficiency behind a single 'good' recent quarter. In the 2026 fundraising environment, a high Cash Conversion Score is the strongest evidence that a team knows how to deploy capital for maximum growth.
Frequently asked questions.
Who popularized this metric?
It was popularized by Bessemer Venture Partners to measure capital efficiency.
What is a 'Good' score?
A score of 1.0x or higher is considered good; 1.5x is exceptional.
How is it different from Burn Multiple?
It looks at the total capital ever raised vs the ARR currently being generated.
Does it apply to bootstrapped companies?
No, it is specifically designed to measure the efficiency of 'venture-raised' capital.
How to improve my score?
Focus on high-velocity growth and avoiding large, unnecessary fundraising rounds.
