The Metrics-Driven Startup: Which Metrics Matter And Why
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The Metrics-Driven Startup Which Metrics Matter and Why Hiten Shah Lean LA • September 21st, 2010
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Transcript of The Metrics-Driven Startup: Which Metrics Matter And Why
The Metrics-Driven StartupWhich Metrics Matter and Why
Hiten ShahLean LA • September 21st, 2010
Ferrari F430 Spider
152 miles per hour
Most Startups Crash and Burn
Let’s talk about what else is easy.
Stop measuring what’s easy.
Start measuring what matters.
Failure attracted me to The Lean Startup
Vanity Metrics
Actionable Metrics
Are the metrics you are tracking helping you make decisions?
Example SaaS Web App
• People sign up and pay online
• They first sign up for a 7 day free trial
• Then they pay $97 per month
What are your assumptions?
Example SaaS Web App
• People sign up and pay online
• They first sign up for a 7 day free trial
• Then they pay $97 per month
Software as a Service Product(Assumptions)
Key Actions % of people # of people
Visit Site 100% 1000
Sign Up 10% 100
Activate 5% 50
Upgrade 1% 10
Revenue $970 per month$970 per month
Baseline these key actions and assumptions.
Software as a Service Product(Actual Baseline)
Key Actions % of people # of people
Visit Site 100% 1000
Sign Up 3.6% 36
Activate 1.2% 12
Upgrade 0.4% 4
Revenue $388 per month$388 per month
What would you try to improve?
Key Actions % of people # of people
Visit Site 100% 1000
Sign Up 3.6% 36
Activate 1.2% 12
Upgrade 0.4% 4
Revenue $388 per month$388 per month
Software as a Service Product(Video Test)
Key Actions % of people # of people
Visit Site 100% 1000
Sign Up 6.5% 65
Activate 1.8% 18
Upgrade 0.3% 3
Revenue $291 per month vs. $388 baseline :($291 per month vs. $388 baseline :(
Get Inspired!
Software as a Service Product(Inspired Test)
Key Actions % of people # of people
Visit Site 100% 1000
Sign Up 7.7% 77
Activate 2.8% 28
Upgrade 1.2% 12
Revenue $1164 per month vs. $388 baseline :)$1164 per month vs. $388 baseline :)
Software as a Service Product(Compare all 3)
Key Actions Baseline Video Test Inspired Test
Visit Site 100% 100% 100%
Sign Up 3.6% 6.5% 7.7%
Activate 1.2% 1.8% 2.8%
Upgrade 0.4% 0.3% 1.2%
Revenue $388 per month
$291 per month
$1164 per month
Crazy Egg Pricing Before
Crazy Egg Pricing After
Crazy Egg Pricing Results
• Before - 150 sign ups per day
• After - 15 sign ups per day
• But revenue doubled in the first month!
Start measuring what matters.
Questions?
Got questions? Want advice? Email Me!
