Viral Coefficient
A measure of how many new users each existing user generates through referrals.
Definition
The viral coefficient (K) measures the organic growth generated by each existing user: K = average invitations sent per user × conversion rate of those invitations. A viral coefficient above 1.0 means the product grows exponentially without marketing spend — each user generates more than one additional user. Below 1.0, virality amplifies but does not sustain growth on its own.
Why It Matters
True viral growth (K > 1) is extremely rare and represents one of the most powerful growth mechanisms in software. Even a K of 0.5 meaningfully reduces effective CAC. Building viral loops — referral programs, share mechanics, network effects — into a product's core experience is a key lever for capital-efficient growth.
Example
If each user invites 5 people and 20% convert, K = 5 × 0.20 = 1.0 — exactly on the viral threshold.