How Startups Metrics Can Help You Measure Your Startup Progress?
With the current boom in the Startup industry, there is a huge flood of new ventures starting up to become the next big thing in the corporate world. Angel Investors and Venture Capitalists are gambling over these startups offering funding in the hope that some of these startups may achieve success as Facebook, Twitter or Google, whereas some others may get acquired by these giant companies.
Hence, it is very important for these startups to perform in order to gain the trust of these funding sources if they aim to achieve success in their respective fields. The best way to achieve such accomplishment for these new ventures is by monitoring their startup metrics. Keeping an eye over these startup metrics will help you ward away too many distractions and allow you to focus on specific goals without any pressure.
Metrics helps in measuring the overall progress irrespective of the platform. Monitoring your startup progress will let you determine if your venture is on a positive path of growth or failing in the process.
So, if you are a startup owner, then I would strictly recommend you to follow these startup metrics if you wish to take your startup to a next level.
Lets, take a look at the startup metrics one by one:
Customers are definitely the key to measure the success rate of your business. However, in the startup industry, there are multiple sources and platform from where you could acquire customers effectively. In order to acquire more customers on daily or monthly basis, you must monitor the previous customer acquisition flow. You must accumulate the data by sorting your customers into source, platform and device. This data would help you to determine the right focus zone to attract more customers in the future. Customer acquisition is definitely the most important startup metric as it helps in growing your business smartly.
In the current world of Mobile App based startups or any other desktop or web based applications, the startup metric defining the churn rate is highly important. Many startups boast about its user growth and deem that as a success factor. Although true to some extent, just having a large user base is not enough if these users leave or unsubscribe almost in a span of a few months or let’s say after an annual subscription. The churn rate is quite decisive to measure the success of a startup as it defines whether the users are loving the product/service or not.
Lifetime Value of a Customer:
Although there are millions of users active on Google and Facebook, these are not their real customers. Among these users, the ones who buy ads or subscribe to their premium services are the real customers. Hence, these giant companies often keep a track on the LTA (i.e. Lifetime Value of a Customer) as this is one such metric that would let you understand how many customers you require or need every month to get your startup on a growth track. Many startups estimate such data as they don’t have enough numbers to play with. Hence, even as an estimation, such data can be very important to set the right goals from the beginning.
A startup operates basically to generate revenue. However, never treat your startup as a machine that simply produces money even though it’s a hot favorite among your customer base. To run a startup as a long term business venture, you must understand the different streams as well as different factors responsible to generate good revenue. These factors and streams comprise together as revenue metrics. Following these metrics, you can identify the processes that requires prioritization while you can always ignore or either remove the ones that do not. This way, you can also understand the user trends and determine the type of services/products, they are willing to pay for. There are users who may like to subscribe the product/service at a feasible monthly or yearly rate while others may spend extra to get the lifetime membership. Revenue metrics would help you understand these intents of the users and help you focus on the most favored subscription options.
The quality of a startup is not limited to the user-friendliness of its product or service alone. Instead of merely depending upon the developers or designers for monitoring the bugs or crashes, you can always allow the users to submit such reports when they experience any crashes or find any bugs while using the App. Such data would help you improve the quality of your product or service to the highest level.
Almost every startup around the world has a sales team in place in order to generate sales, leads or referrals for the startup venture. Monitoring the salesman metrics can help you sort the best performers from the non-performers in the team. Most importantly, you can always train the new sales team using these metrics that would give a rough idea on number of calls per day, recommended call length, etc. You can always record these sales calls and pick some conversations in order to train your team during meetings or training sessions. Salesman metrics would also help you decide whether you need to extend or reduce the sales team for the future.
The startup metrics discussed above are the basics that every startup must follow in order to achieve success in their respective industry as well as staying one step ahead of the competition. However, the prioritization of these metrics may vary depending on the type of the industry your startup belongs to.
So, if you’re not already monitoring these startup metrics, then its time to hold a meeting with your core team and set up measures to assess these metrics as soon as possible. Any metric you miss from the above from now is the opportunity missed to improve your startup venture.
Go ahead. Start measuring your startup now!