Growth Model
Definition
The component of the financial model that specifies the mechanisms by which the company acquires new customers or users, the drivers of revenue growth in each period, and the assumptions governing the rate at which those drivers translate to revenue. Different company types require different growth model architectures: B2B Enterprise companies use a pipeline and sales capacity model; Recurring Revenue software companies use a subscription growth model; Product-Led Growth companies use an activation and conversion model.
Common Misapplication
The most common misapplication is using a single growth rate assumption as the growth model. A growth model is not a growth rate; it is a structured representation of the specific operational mechanisms that produce growth. A model that applies a single percentage growth rate to revenue without specifying the sales capacity, pipeline, or acquisition mechanism that justifies it is not a compliant growth model.
FFI Standard Reference
This term is defined and applied in Book 2, Section 2.3: The Growth Modeling Standard.
Related Terms
Citable URL
This term may be cited using the following permanent URL.
Full citation format: Founder Financial Infrastructure Standard, Beta v0.5, Glossary: Growth Model. https://ffistandard.org/glossary/growth-model/. 2026.