📍 Key considerations

| 1️⃣ Metrics are important since they enable investors and entrepreneurs to | - Track the health and growth of the business

Support (substantiate, actually) decision-making
Communicate among themselves and with other stakeholders
Benchmark their performance | | --- | --- | | 2️⃣ Relevant considerations | - If you want to improve something, start from tracking it (well)
The metric and systematic approach you use clearly affects what you see
It's much easier to measure quantity (e.g. website visitors), than quality (super fans)
In general: what is tough to measure, is tough to manage - John Doerr
Being (very) wrong in calculating metrics = bad decision making and poor transparency → we will focus a bit on this | | 3️⃣ Unit Economics are specially relevant since they: | - Mirror & summarize the drivers that allow to understand and optimize operations
Provide the most reliable inputs for forecasting & planning
Show more clearly when a business is unprofitable and cannot (shouldn't) be scaled | | 4️⃣ Traditionally, metrics must be: | - Precise: calculations and understanding must be documented and shared
Realistic: a good trade off between ambition and motivation
Time-specific: temporally bound
Actionable: focused on an action
Measurable: thus, avoid directional indicators that can't be measure and tracked
Accesible: people must be able to understand how to read them and have ready access to latest data
Challenging (but again, realistic) | | 5️⃣ But its even better when they are: | - Breakable: into smaller pieces, subsets that are relevant for individuals and teams (ideally have a map of KPIs)
Benchmarkable: (internally: vs. oneself; & externally: vs. competitors)
Auditable: an skeptic must be able to check how the metrics were produced
Oriented towards next stages: in terms of funding, sales (...)
Few, & relevant: to avoid noise 〰️ Most KPIs and Metrics are standardized and meet the above-mentioned requirements |

✅ Reason by analogy, noy only by data
✅ If you could focus on only one metric to guide your life, what would it be?

📨 Cheat Sheets

🔢 Key startup metrics

1. Unit Economics

2. Revenue & Growth

3. Acquisition

4. Activation

5. Referral

6. Engagement

7. Retention

8. Other metrics

📈 (Classic) Financial metrics

🧑‍🔧 (Classic) Business KPIs

👨‍👨‍👧‍👧 (Classic) People Metrics

🎒 Benchmarks

🗺️ Relevant frameworks

🚯 Other considerations & Readings

Traditional SaaS Metrics may not be as meaningful in PLG (Product Led Growth) strategies or consumption-based models (see RGR or NGR) + see latest Openview and Battery Ventures 2021 Software Report for thoughts on this (1)

📌 Some people think the analyzing metrics is more art than science - tons of data are useful but noisy, and as investors we must be able to imagine the future (Aquilino Peña, retweaked)

📌 Growth is important, but engagement provides healthy growth (Aquilino Peña)

📌 Know the difference between data-informed and data-driven, metrics are a reflection of the product strategy (by Andrew Cheng)

📌 Unit Economics Tool for Excel and Google Sheet - by Taylor Davidson from Foresight