Why Misunderstanding Startup Metrics Can Cost You Your Business

Both Sides of the Table

There has been a lot of public debate over the past several weeks about whether it’s a good thing to be “gross margin positive” or not and commentary always reminds me that some people at startups don’t quite understand financial metrics or even how to think about which ones are healthy.

How Startups Can Use Metrics to Drive Success

Both Sides of the Table

Having a set of metrics that you watch & that you feel are the key drivers of your success helps keep clarity. And the more public you can make your goals for these key metrics the better. You’ll have no idea when you’re off course. Revenue Metrics. Salesman Metrics.

Granularity and Consistency of Startup Metrics

SoCal CTO

Part of those questions are around Startup Metrics. This aligns with understanding the the core business model: Get Users (= Acquisition, Referral) Drive Usage (= Activation, Retention) Make Money (= Monetize) (and Lifetime Value is a good one) Of course, that’s a big part of what the investor wants as well.

Timing and why we’re all VCs

TechCrunch LA

It’s obvious that we can be too late to these decisions of course. If — and it’s a big if of course — they can do that on the cheap, then why should an LP care at all? Some more on metrics design and quantification.

Does your team know your playbook?

Berkonomics

And if you have a plan but do not share it with your direct reports, then they are acting without motivation toward mutual goals, without metrics to measure their progress toward the goals, and without the leadership that makes great winners. This one comes straight from football.

Coach 218

Please learn this: “Noses in; fingers out!”

Berkonomics

The CEO spoke, shared metrics, spoke of issues to be addressed during the coming week, and did a fine job of pointing the assembled troops in the right direction. Many of us have someone who reports directly to us and who supervises others in return.

The five tactical skills of a great executive

Berkonomics

These are not the strategic visionary skills, like leading companies through risky product launches, or steering the course through economic storms where leaders become oversized personalities for their superhuman efforts. There are many types of metrics, some very easy to manage.

Making Sure You Are Ready to Begin Building Your MVP

SoCal CTO

I'm going to be looking at aspects like: Things to consider before building your MVP Features often overlooked when documenting an MVP for developers Understanding important metrics you want to measure Risks and challenges in developing an MVP. Correct your course quickly.

How do you measure your effectiveness as a leader?

Berkonomics

We can invent lots of metrics to measure progress for a leader, including revenue, profit, employee satisfaction, cost containment, percentage of available market, and more. There are many roads to Rio, so they say.

Does Your Team Know What Success Looks Like?

Alon Schwartz

We were both right, of course?—?looking It didn’t change the metrics that were important for the business. Shot of a group of businesspeople high fiving in an office. When Jason Nazar and I launched Docstoc years ago, we got 30,000 unique users on the first day. I was ecstatic.

Pragmatism with Flavor

TechEmpower

Focusing on the metrics that ultimately drive the business, often the bottom line, has provided a reality check, a counter-weight to the desire to consume all new technologies. Although we spend plenty of time researching and developing with new technologies based on desire and need, we don't want our clients to be guinea pigs (unless that's the nature of their business, of course). Project needs vary, of course, so technology chemistries vary in turn.

32 Questions Developers May Have Forgot to Ask a Startup Founder

SoCal CTO

Of course, it's way more complex than just these questions. What are your key Startup Metrics ? Analytics/Metrics - what are the key startup metrics that you will need to track? Are there specific metrics needed for future funding rounds or for operations?

Be Honest About Whether Your Product Really Makes a Difference

Both Sides of the Table

And of course it’s true in personal productivity apps, SMB apps, B2B software and so forth. His point is that you should figure out the metrics that TRULY matter in your business and hold yourself accountable to these. Not vanity metrics. Startups in a world of massive markets can be confusing. The law of large numbers, platforms that can make your company blow up unexpectedly and the trendy nature of tech markets can be deceiving. Success for many is ephemeral.

32 Questions Developers May Have Forgot to Ask a Startup Founder

SoCal CTO

Of course, it's way more complex than just these questions. What are your key Startup Metrics ? Analytics/Metrics - what are the key startup metrics that you will need to track? Are there specific metrics needed for future funding rounds or for operations?

How can I trust that my virtual employees are working?

Berkonomics

Of course we have expectations and KPIs, but any slackers would soon find themselves very uncomfortable surrounded by results–oriented team. It takes trusting management, good metrics, and entrepreneurial employees.

Coach 190

Who Should be on Your Startup Board?

Both Sides of the Table

Of course it happens all the time?—?especially If your metric move immediate up-and-to-the-right? Of course. One of the things that founders have the most angst about is whom they should have on their board and at what stage of the business.

Lighting the match – going viral

Berkonomics

And of course sometimes that requires a large amount, far beyond the capability of small companies looking for its initial audience. Well-tuned metrics are an absolute must. It doesn’t happen by accident. Not every new game site is a Club Penguin or Minecraft.

How Great, Operationally-Focused CFO’s Can Transform Your Business

Both Sides of the Table

A great CFO will make sure you’re accurately measuring your CAC (along with a great marketer, of course) and your LTV. The full financial details and metrics were in the deck. So my time was freed up to call board members in advance and walk them through our metrics and understand any concerns. David set up employee policies, helped negotiate office leases, established our long-term accounting system, implemented RJ Metric and so forth.

Happy Customers Make Gender Bias (Nearly) Irrelevant

InfoChachkie

Don noted that, "I always believed that metrics and accomplishments can outrun bigotry, sexism, racism or any ''ism'' that might otherwise hold you back. It''s not perfect, of course. A version of this article previously appeared on The Wall Street Journal.

Custom 197

When the Good Guys in Venture Change Roles

Both Sides of the Table

He had always read all of the materials, gone through the metrics, done pre-calls with the CEO and was always respectful in how he walked through the challenges of the company and our remedies. Of course Kleiner has had a difficult couple of years.

Gogii 318

How the Seed-Stage VC Trend Began, The Downsides of Unicorns & Much More

Both Sides of the Table

It is, of course, a very recent phenomenon. Having a great early investor provides downstream capital with a “signal” that you are a company worthy of being paid attention to even if you haven’t scaled your metrics.

The new Berkus SMALL BUSINESS SUCCESS COLLECTION – eBooks and books

Berkonomics

Creating metrics. Farming out tasks beyond your core, and of course, much more. New forms of metrics for your business. Announcing EIGHT new mini-books and eBooks by Master Entrepreneur, Dave Berkus , just released by The Berkus Press.

eBook 197

The Loneliness of Success that Nobody Talks About

Both Sides of the Table

Of course that’s true. Every $10 million financing only puts more pressure on the founders to figure out how to hit the metrics to get to the next milestone and every company that raises $25 million puts a ton of pressure on their 10 competitors who haven’t.

Press 405

Here’s Why a Booming Tech Market May Fool You into Thinking You’re Successful

Both Sides of the Table

Of course back then it literally was sold in a package and stored on a shelf! Create company measures for success that go beyond financial metrics. You manage what you measure so be careful about having too narrowly defined of performance metrics. Perhaps having renewal rates with a good bonus spiff, have a component of MBO tied to usage performance metrics or spiff certain milestones like business plans. Since 2009 we’ve been in an unequivocal bull market.

Pricing Customer Acquisition Sunk Costs and More - Ten Recent Great Startup Posts

SoCal CTO

Startup Killer: the Cost of Customer Acquisition | For Entrepreneurs , February 2, 2010 Looks at the critical equation around customer acquisition cost vs. customer lifetime value similar to what I discussed in Startup Metrics but in more depth. Of course, one of the best ideas around this is to have Negative Customer Acquisition Costs. A VC : Venture Capital and Technology , February 18, 2010 Great post from Fred Wilson that questions a common metric – unique visitors.

Non-millennial Bootstrapping – These 50-Something Entrepreneurs Rejected VC $ And Nailed It

InfoChachkie

Semick: We’re a very metrics driven company, and we have been from the beginning. Metrics related to customer acquisition, lifetime value and churn. We’re transparent with our employees about these metrics and where the company stands with monthly marketing and sales goals.

How to Solve the Biggest Frustration Marketers Have With Social

Both Sides of the Table

And of course you could add up impressions by counting your the followers of everybody who had retweeted plus your own. It is what is commonly referred to as “vanity metrics” as in, “Look at how many more followers I got us!

How Open Should a Startup CEO be with Staff?

Both Sides of the Table

Of course not. Of course you need to be open. Good press and industry mojo wasn’t enough to overcome the financial metrics of the business and the offers came in at more like $10 million. Of course you shouldn’t f **g buy a house. CEO transparency.

Course 428

Lean Startup Legend Steve Blank Discloses His Most Daring Guerrilla Marketing Tactics

InfoChachkie

He met with the editors of the three Mac magazines that his customers read and showed them metrics that confirmed that SuperMac's boards were the fastest on the market. "I I highly recommend Steve's How To Build A Startup online courses.

In 15 Years From Now Half of US Universities May Be in Bankruptcy. My Surprise Discussion with @ClayChristensen

Both Sides of the Table

Today’s higher education is responding by making more courses online and available to people outside of physical boundaries. ” But I pointed out a professor at HBS ( Tom Eisenmann ) who teaches a course where blogs are a part of the classroom reading material.

Startup CTO or Developer

SoCal CTO

Of course, I have an advantage because I organize the LA CTO Forum. Of course, since you know those questions, you can just collect up the answers and provide them to your developers. Of course, it’s never complete.

CTO 259

If You Don’t Have a Discrete Hypothesis You Are Incapable of Failing

Both Sides of the Table

Oh, and if you didn’t guess, the title, “if you don’t have a discrete hypothesis you are incapable of failing” is, of course, an Eric Ries quote. 48:30 Vanity metrics. 52:00 Actionable metrics.

Why I F **g Hate Unicorns and the Culture They Breed

Both Sides of the Table

Not the successful companies themselves but the entire b t culture of swash-buckling startups who define themselves by hitting some magical $1 billion valuation number and the financiers who back them irrespective of metrics that justify it. For a fee, of course. And of course it’s not just our industry – it’s pervasive in society, this short-cut mentality. Something is rotten in tech startup land. Don’t call me a hater for saying so.

Ten Startup Tips From Amazon Founder, Jeff Bezos

InfoChachkie

If your culture rewards those who seek the truth, your team will be prone to objectively identifying tactical course corrections. But we do it anyway, because we believe that the short-term metrics probably aren’t indicative of the long term.”.

Tips 285

Bad Notes on Venture Capital

Both Sides of the Table

It’s like we need a finance 101 course for entrepreneurs. There were no metrics. Him: On metrics. If we priced it based on any metrics your company would likely be worth less than 7 figures at your A round. This week. On the phone … Me: So, you raised venture capital? Him: Yeah. We raised a seed round. About $1 million. Me: At what price? Him: It wasn’t priced. We raised a convertible note. Me: With a cap? Him: Yes, $8 million. Me: Ah. I see.