Selecting the right metrics for your startup

METRICS, VALIDATIONBALAJI VISWANATHAN, JULY 7, 2016

ABOUT MYSELFWorked at Microsoft R&D Has two Masters degrees in CS & Business Administration Founded two startups Managed innovation at a pre-IPO stage company

WHAT WE ARE GOING TO TALK 1.Why startups in the US have high valuations? 2.The idea loop 3.The characteristics of metrics 4.Building the right metrics

WHY ARE STARTUPS SO CRAZY IN THE US?

WHY DO US STARTUPS HAVE SO HIGH EXITS

WHAT STARTUPS MEAN ELSEWHERE

Enterprises Startups

STARTUPS IN THE US

Enterprises Startups

FAMED ACQUISITIONSApplied Semantics —> Google [AdSense]

Forethought —> Microsoft [Powerpoint]

Instagram —> Facebook

IDEA LOOP

IDEA

DATA PRODUCT

Build

Measure

Learn & pivot

STARTUPS VS LARGE ENTERPRISES

Enterprises Startups

STARTUPS ARE EXCITING BECAUSE THEY CAN REACT FASTER THROUGH BETTER DATA COLLECTION.

METRICS & MEASUREMENTSMaking smart decisions with data

FOCUS ON THE GROWTH & NOT SIZE

Lorem

The need for metrics

The vanity metric

3 A’S OF METRICS

ACTIONABLE ACCESSIBLE AUDITABLE

CAN YOU GET THE DATA ON TIME?

CAN EVERYONE UNDERSTAND IT?

CAN YOU ACT ON THE METRIC?

IS IT AUDITABLE? DATA HAS TO BE REPRODUCIBLE & CREDIBLE.

TYPES OF METRICS

TOTAL SIGNUPSPERCENTAGE OF

NEW MEMBERS PER WEEK

PERCENTAGE OF USERS WHO SIGN

IN 3 TIMES A WEEK

PERCENTAGE OF USERS WHO

COMPLETED 1 PROJECT THIS

WEEK

Vanity Growth Usage Engagement

Good

MANAGING METRICS

QUALITATIVE QUANTITATIVE

COMPARATIVECOMPETITIVE

COMMON TYPES OF METRICS.FINANCIAL

1.Revenue

2.Gross profit

3.Gross margin

4.LTV

PRODUCT SALES

1.Cost of customer acquisition

2.Sales cycle [in months]

3.Conversion [awareness to sales]

1.Churn rate

2.Time between product releases

3.Month on Month growth in engaged users

4.Viral coefficient

5.Response time to tickets

METRICS CHECKLISTDoes it start with a percentage? Can everyone in organization understand it?Can you act on the numbers?

Does it reflect key user behavior?

Does it have a time element to it?