What is Viral Coefficient (K-factor)?
Nexa Consultancy | Startup & Finance Glossary
The Viral Coefficient, or K-factor, is a metric that measures the organic, word-of-mouth growth of a product. It represents the number of new users that each existing user successfully invites or refers.
Base Term for Startups: A K-factor greater than 1.0 indicates exponential viral growth, which is the holy grail for consumer apps and product-led startups. It means the user base is growing on its own without paid marketing spend.
Base Term for SaaS/Consumer Tech: This is often engineered into the product through features like "Invite a teammate" or referral programs that reward users for bringing in new customers.
Calculation: K = (Number of invites sent per user) * (Conversion rate of invites)
Base Term Example: If each user of a new app invites 5 friends on average, and 25% of those friends sign up, the K-factor is 5 * 0.25 = 1.25. This means every user brings in 1.25 new users, leading to viral growth.