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Selecting the right metrics for your startup

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METRICS, VALIDATION BALAJI VISWANATHAN, JULY 7, 2016
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Page 1: Selecting the right metrics for your startup

METRICS, VALIDATIONBALAJI VISWANATHAN, JULY 7, 2016

Page 2: Selecting the right metrics for your startup

ABOUT MYSELFWorked at Microsoft R&D Has two Masters degrees in CS & Business Administration Founded two startups Managed innovation at a pre-IPO stage company

Page 3: Selecting the right metrics for your startup

WHAT WE ARE GOING TO TALK 1.Why startups in the US have high valuations? 2.The idea loop 3.The characteristics of metrics 4.Building the right metrics

Page 4: Selecting the right metrics for your startup

WHY ARE STARTUPS SO CRAZY IN THE US?

Page 5: Selecting the right metrics for your startup

WHY DO US STARTUPS HAVE SO HIGH EXITS

Page 6: Selecting the right metrics for your startup

WHAT STARTUPS MEAN ELSEWHERE

Enterprises Startups

Page 7: Selecting the right metrics for your startup

STARTUPS IN THE US

Enterprises Startups

Page 8: Selecting the right metrics for your startup

FAMED ACQUISITIONSApplied Semantics —> Google [AdSense]

Forethought —> Microsoft [Powerpoint]

Instagram —> Facebook

Page 9: Selecting the right metrics for your startup

IDEA LOOP

IDEA

DATA PRODUCT

Build

Measure

Learn & pivot

Page 10: Selecting the right metrics for your startup

STARTUPS VS LARGE ENTERPRISES

Enterprises Startups

Page 11: Selecting the right metrics for your startup

STARTUPS ARE EXCITING BECAUSE THEY CAN REACT FASTER THROUGH BETTER DATA COLLECTION.

Page 12: Selecting the right metrics for your startup

METRICS & MEASUREMENTSMaking smart decisions with data

Page 13: Selecting the right metrics for your startup

FOCUS ON THE GROWTH & NOT SIZE

Page 14: Selecting the right metrics for your startup

Lorem

The need for metrics

Page 15: Selecting the right metrics for your startup

The vanity metric

Page 16: Selecting the right metrics for your startup

3 A’S OF METRICS

ACTIONABLE ACCESSIBLE AUDITABLE

Page 17: Selecting the right metrics for your startup

CAN YOU GET THE DATA ON TIME?

Page 18: Selecting the right metrics for your startup

CAN EVERYONE UNDERSTAND IT?

Page 19: Selecting the right metrics for your startup

CAN YOU ACT ON THE METRIC?

Page 20: Selecting the right metrics for your startup

IS IT AUDITABLE? DATA HAS TO BE REPRODUCIBLE & CREDIBLE.

Page 21: Selecting the right metrics for your startup

TYPES OF METRICS

TOTAL SIGNUPSPERCENTAGE OF

NEW MEMBERS PER WEEK

PERCENTAGE OF USERS WHO SIGN

IN 3 TIMES A WEEK

PERCENTAGE OF USERS WHO

COMPLETED 1 PROJECT THIS

WEEK

Vanity Growth Usage Engagement

Good

Page 22: Selecting the right metrics for your startup

MANAGING METRICS

QUALITATIVE QUANTITATIVE

COMPARATIVECOMPETITIVE

Page 23: Selecting the right metrics for your startup

COMMON TYPES OF METRICS.FINANCIAL

1.Revenue

2.Gross profit

3.Gross margin

4.LTV

PRODUCT SALES

1.Cost of customer acquisition

2.Sales cycle [in months]

3.Conversion [awareness to sales]

1.Churn rate

2.Time between product releases

3.Month on Month growth in engaged users

4.Viral coefficient

5.Response time to tickets

Page 24: Selecting the right metrics for your startup

METRICS CHECKLISTDoes it start with a percentage? Can everyone in organization understand it?Can you act on the numbers?

Does it reflect key user behavior?

Does it have a time element to it?


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