Metrics That Matter

What are the Metrics That Matter for your venture? No… not the vanity metrics that so many of us were taught to pay attention to.  What are the metrics that actually show you if your venture is on the right track?

I watch my students struggle with this a great deal.  I’d like to offer some patterns that can serve as a starting point to anyone considering these questions.

  1. Cost to acquire/get a customer helps you evaluate different channels for their relative value, shows you when your website is doing a terrible job of converting visitors into contacts, steers you towards labor-efficient/scalable techniques, etc.
    Somesubmetrics:

    1. Sales & marketing costs: out-of-pocket + labor (assume a market-rate labor cost so you do not underestimate labor-intensive marketing channels)
    2. # hits to your website, # of cold calls
    3. % that convert to contact you, % that meet with you
    4. % that purchase
  2. Cost to keep/retain a customer helps you spot when you are using unsustainable customer service / product delivery procedures.
    Somesubmetrics:

    1. Cost of customer service team, returns, refunds, etc.
    2. # of customers
  3. Lifetime value of a customer helps you think about customer retention and how to grow revenue from existing customers by keeping them longer or by solving other problems for them via new products.
    1. % of customers who renew
    2. Revenue per customer

These three metrics, while not all-inclusive, are a fantastic starting point.

 

You’re Invited! Lean Launchpad: Pioneer Valley Graduation & Demo Day

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If you’ve been following this blog you know that the Lean Launchpad is the #1 entrepreneurship curriculum in the country.  It has proven it can dramatically increase startups’ odds of success by accelerating their ability to find a repeatable, scalable business model before they run out of ramen noodles (or spousal patience :)).  

WE INVITE YOU TO COME SEE FOR YOURSELF.

The latest cohort of Western Massachusetts teams to complete the Lean Launchpad curriculum is graduating on 4/28 @ 5pm and giving their final presentations.  No spin-ridden investor pitches will be shown this night.  Instead the audience will hear how the companies developed their ideas, field tested them with real customers, changed (often radically) their businesses, and did the whole process over and over again until they got it right or ran out of time.  You’ll see how they learn and how they adapt.  You’ll also see how the Lean Launchpad curriculum is so different.  

And after the presentations… then there will be wine :).

You must RSVP to attend as space (and wine!) is limited.  We would love to have you join us.

Click to RSVP via Eventbrite

Click to RSVP via Eventbrite