Metrics for Startup Success and Failure

Metrics that Matter Defining startup success and failure Hiten Shah Customer and Business Development Class at Berkeley • Mar 9, 2010

The Startup Pyramid The Race to the Top Growth Transition to Growth Product / Market Fit Sean Ellis: Startup-Marketing.com

Product / Market Fit • Low burn, focused on product, no VPs / sales people • Customer Development (Steve Blank, Four Steps) • Minimum Viable Product (Eric Ries, The Lean Startup) • Pivots (Eric Ries, The Lean Startup) “…the life of any startup can be divided into two parts – before product/market fit and after product/market fit.” Marc Andreesen, Founder of Netscape

Customer Development • It’s all about learning and discovery • Outlined by Steve Blank in Four Steps to the Epiphany

Minimum Viable Product • Coined by Eric Ries as part of The Lean Startup • Lean Startups are a series of MVP’s • Each designed to answer a specific question (hypothesis) “ The minimum viable product (MVP) is often an ad on Google. Or a PowerPoint slide. Or a dialog box. Or a landing page. You can often build it in a day or a week.” Nivi, Venture Hacks

“ If Apple can launch a smartphone without Find or Cut-and- Paste, what can you cut out of your product requirements?” Lance Glasser, former CTO KLA-Tencor

“ The first version of Gmail was literally written in a day” Paul Buchheit, Google / Friendfeed / Facebook

Pivot “ The idea that successful startups change directions but stay grounded in what they've learned.” Eric Ries, The Lean Startup • Segment pivot - existing product, different customers • Customer problem pivot - same customers, different problem • Feature pivot - pick a feature and reorient around it

Product / Market Fit Metrics Created by Sean Ellis (12in6) • 40%+ of users say they would be “very disappointed” • Representative of a large enough target market • Use Survey.io to get started Sean Ellis: Startup-Marketing.com

Transition to Growth “ Once you have achieved product/market fit, it’s time to accelerate through the next steps of the pyramid and then begin scaling your business.” Sean Ellis, 12in6 • Positioning - optimize first user experience via messaging • Economics - implement a business model • Optimization - track and report on the right metrics

First Product Iteration Target Customer: Social Application Developers

Pivot 1 Target Customer: Many customer types

Pivot 2 Target Customer: 1 specific customer type

“Metrics are people, too” Eric Ries, The Lean Startup

Test Things for Yourself!

Thank You! “Passionate about helping other entrepreneurs and startup people.” @hnshah hshah@kissmetrics.com

http://hitenshah.name	144
http://www.blogpiloten.de	61
http://www.slideshare.net	41
https://pramati.qontext.com	15
http://www.netzpiloten.de	7
http://test.www.netzpiloten.de	6
http://abrahamshafi.com	6
http://vinhtheredonethat.tumblr.com	3
http://safe.tumblr.com	3
http://feeds.feedburner.com	3
http://b.feednewmedia.com	2
http://paper.li	1
http://bullsbmw.posterous.com	1
http://static.slidesharecdn.com	1

Metrics for Startup Success and Failure

by Hiten Shah on Mar 10, 2010

Accessibility

Categories

Tags

Upload Details

Usage Rights

14 Embeds 294

Statistics

Metrics for Startup Success and Failure — Presentation Transcript