Framework · Measurement
Growth accounting and the user state model
Split active users into new, retained, resurrected and churned each period; the user quick ratio, (new + resurrected) / churned, must exceed 1 to grow. Duolingo's state model classifies every user daily and showed that lifting current-user retention (CURR) moved daily actives most. It is the tool for splitting a decline by phase.
Plain label: where active users come from and goAlso known as: quick ratio, Duolingo state model, CURR, resurrection, phase split
User accounting. This period's actives = new + retained + resurrected; last period's actives = retained + churned. Use rolling 28-day windows. For consumer apps, Hsu treated ratios between 1 and 1.5 as middling and between 1.5 and 2 as strong (benchmark confidence A, expert opinion).
Revenue accounting. Recurring revenue moves by new, expansion, resurrected, contraction and churned revenue. Net revenue retention includes expansion; gross retention excludes it. A SaaS quick ratio of 4 is a widely repeated rule of thumb with weak attribution (benchmark confidence C).
State model. New, current (active today and in the prior week), reactivated (back after 8-30 days), resurrected (after 30+), at-risk and dormant. Simulating a 2% monthly lift in each transition showed CURR mattered most; the team then moved it with tests, and daily actives grew about 4x from 2019 to early 2023 (company-reported).
How it plugs in. At Stalled, compare the last 90 days with the six months before: fewer new users points to Discover, more veterans leaving to Stay, early users not returning to Return.
Sources
Diligence at Social Capital, Part 1: Accounting for User Growth · Social Capital (Jonathan Hsu), 2015
Benchmark confidence A. A primary source for the benchmark.Meaningful metrics: the Duolingo growth model · Duolingo Blog (Erin Gustafson), 2023
Benchmark confidence A. A primary source for the benchmark.What is the quick ratio hiding? · Tom Tunguz
Benchmark confidence C. A secondary source.
Book content is paraphrased, never quoted at length. Last verified October 24, 2026.
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