@agatestudio

Lean Analytic

Marvin

Clerics

Agate Studio

@agatestudio

Lean Analytics: Using data to build a better

startup faster

TDS – 12 April 2014

Lee Marvin- lee.marvin@agategames.com

@agatestudio

WHAT IS LEAN ANALYTICS?

@agatestudio

What is Lean Analytics?

Make what you can sell, don’t sell what you can make

@agatestudio

What is Lean Analytics? (cont’d)

@agatestudio

THE LEAN ANALYTICS FRAMEWORK

@agatestudio

Lean Analytics Stages

Empathy • I’ve found a real, poorly-met need a reachable market faces

Stickiness

• I’ve figured out how to solve the problem in a way they will adpot and pay for

Virality

• I’ve built the righ product/features/functionality that keeps users around

Revenue • The users and features fuel growth organically and artificially

Scale

• I’ve found a sustainable, scalable business with right margin in a healthy ecosystem

@agatestudio

Empathy Stage: Localmind hacks Twitter

• Needed to find out if a core assumption-strangers answering questions – was valid

• Ran Twitter Exeriment instead of writing code

• Asked senders of geolocated Tweets from Times Square random questions; counted response rate

• Conclusion: high enough to proceed

@agatestudio

Stickiness: qidiq streamlines invites

Survey owner adds recipient to group

Survey owner asks questions

Recipient gets invite

Recipient installs mobile app

Recipient creates account

Recipient reads survey question

Recipient responds to question

Recipient sees survey results

Survey owner adds recipient to group

Survey owner asks questions

Recipient gets invite

Recipient installs mobile app

Recipient creates account

Recipient reads survey question

Recipient responds to question

Recipient sees survey results

10

-25

% R

esp

on

se R

ate

70

-80

% R

esp

on

se R

ate

@agatestudio

Who is worth more?

A

B

pre

sen

t

Lifetime: $200

Lifetime: $200

@agatestudio

Virality Stage

Users Viral Coefficient Churn &

abandonment x - > 1

• How to calculate viral coefficient:

• 2000 users sent 5000 invitation

• Your invitation rate = 2,5

• Every ten invitations get 1 sign ups

• Your acceptance rate = 0,1

• Multiply the two,you have viral coefficient 0,25

• Every customer you add will add an addition 25% of customer

@agatestudio

Revenue Stage: Backupify’s Customer Acquisition Payback

• Initially focused on site visitors

• Then focused on trials

• Then switched to signus

• Early 2010, CAC was $243 and ARPU was only $ 39

– Pivoted target business users

– CLV-to-CAC today is 5-6x

• Metrics: Customer Acquisition Payback

– Target is less than 12 months

@agatestudio

CLV calculation

25%

Monthly Churn

100/25=4

The average customers

lasts

5% Monthly

Churn

100/5=20

The average customers

lasts

2% Monthly

Churn

100/2=50

The average customers

lasts

@agatestudio

Scale Stage: Incremental order cost

Fixed Cost

@agatestudio

Six Tech-Business Archetype

E-commerce

2 Sided Market

SaaS

Mobile App

User-gen content

Media

@agatestudio

Lean Analytics Framework

Empathy

Stickiness

Virality

Revenue

Scale

E-commerce

2 Sided Market

SaaS Mobile

App User gen-content

Media

Model + Stages = One Metrics that Matters

@agatestudio

Moz cuts down on metrics

• SaaS-based SEO toolkit in the scale stage, Focus on net adds – Net adds up:

– Net adds flat:

– Net adds down:

Was a marketing campaign successful? Were customer complaints lowered?

Was a product upgrade valuable?

Can we acquire more valuable customers? What product features can increase engagement?

Can we improve customer support?

Are the new customers not in the right segment? Did a marketing campaign fail?

Did a product upgrade fail somehow? Is customer support failing apart?

@agatestudio

Lean Analytics Framework (detailed)

Thank You

Bit.ly/BigLeanTable