Startup metrics:because everything counts              Justo Hidalgo        jhidalgo@24symbols.com              @justohida...
Let’s talk about metrics andstartups!
Watch this…500startups’ Dave McClure
… and this!Carsonified’s Ryan Carson
Hi!■ Co-founder,■ Data Integration and Management,  Product Strategy and Innovation■ Ph.D. in Computer Science on Data  In...
24symbols is a service to read digital books on the Internet based on a subscription model                = cloud + social...
40000                                  45000                                          50000                               ...
My goals today Metrics are important Metrics are useful in many dimensions. Start from day 1 There are some “standards” bu...
What I won’t talk about A/B Testing Qualitative measurement  • Competitive landscape, UX quality, … Standard financial met...
AARRRAcquire     Activate     Retain         Refer      Get RevenueSEO         Landing     Content        Campaigns     Sh...
AARRR is great for starters…… but focused on linear acquisition flow
Traffic Metrics
Acquisition How do people find your site?
@justohidalgo
15 seconds in “La       1”
MetricsNumber of visits         Distributions (per browser, region,                         …)Bounce rate                 ...
Pivots? Customer-segment pivot     But always… Cohort Analysis and     Segmentation!!!!
AActivation    How sticky is your site?
Metrics   # Sign ins!!!            Recency (time since user did85000                            something meaningful)80000...
Pivots? Channel pivot Needed faster growth But 0€ for marketing! Content is critical but it cannot be an excuse 3rd party ...
Biggest Apple                Reseller in Spain                1-year                subscription to                24s per...
AARetention  Why do users come back?
Metrics. The standard ones… Number of unique/returning visitors Visits over time Average session time
… engagement… D/WAU: Daily/Weekly Active Users MAU: Monthly Active Users                D/WAU Stickiness =                ...
… but also domain-specific!!! # Active readers # Books read per user Pages read per active reader per month               ...
Pivots? Not yet, but:  • Retention and    engagement through FB    is extremely tough  • A confirmation:    engagement is ...
85+ publishers, 10+ in UK and growing@justohidalgo
Social Metrics
AARReferral Do people talk about your site?
Types of users Visitor Contributor Distributor
ViralityAmplification rate:• (#shares, #RTs, …)K-Factor = AR *conversion rate• = 1: steady state• > 1: growth    ➤ 1.4 < x...
The Four Viral App Objectives     % viral hosts     Contact rate per active host     Duration of each active host’s     in...
Pivots? Engine of growth pivot 1st: Let’s use SEM, …  • Expensive  • Might use it, but carefully A few campaigns have show...
@justohidalgo
Business Metrics
AARRRevenue    Do you make money?
3 metrics for SaaS CMRR LTV CACR
Churn
CMRR SaaS = recurring revenues CMRR = Committed Monthly Recurring Revenue • Recurring + new accounts + new upsells – churn
LTV                                                     ARPU *                                                            ...
Customer Acquisition Cost                     gross margin per customer CAC Ratio=                  sales/marketing costs ...
LTV vs CAC Of course, LTV > CAC But, moreover: LTV > 3x CAC
Freemium. Conversion Rate                                              Free    Users                   Delayed subscriptio...
Freemium for Books. Price per page Price/page                                  Profit threshold              Growth   Cons...
Pivots? Too soon, but… Channel pivothttp://www.businessinsider.com/state-of-internet-slides-2012-10?op=1
Tools
Conclusions
@justohidalgo
2. Have someone taking care of it
3. Only measure what you truly care about@justohidalgo
But again, choose right
4. Beware vanity metrics…
… they may hide an awful truth
Thanks for your time!Justo Hidalgohttp://www.loscuentosdelabuelo.comjhidalgo@24symbols.com@justohidalgo
Credits  Olivier Guin, from The Noun Project  Dima Yagnyuk, from The Noun Project  Redesign from Otl Aicher’s icon, from T...
Metrics. Because everything COUNTS (LeanCamp Madrid 2012)
Metrics. Because everything COUNTS (LeanCamp Madrid 2012)
Metrics. Because everything COUNTS (LeanCamp Madrid 2012)
Metrics. Because everything COUNTS (LeanCamp Madrid 2012)
Metrics. Because everything COUNTS (LeanCamp Madrid 2012)
Metrics. Because everything COUNTS (LeanCamp Madrid 2012)
Metrics. Because everything COUNTS (LeanCamp Madrid 2012)
Metrics. Because everything COUNTS (LeanCamp Madrid 2012)
Metrics. Because everything COUNTS (LeanCamp Madrid 2012)
Metrics. Because everything COUNTS (LeanCamp Madrid 2012)
Metrics. Because everything COUNTS (LeanCamp Madrid 2012)
Metrics. Because everything COUNTS (LeanCamp Madrid 2012)
Metrics. Because everything COUNTS (LeanCamp Madrid 2012)
Metrics. Because everything COUNTS (LeanCamp Madrid 2012)
Metrics. Because everything COUNTS (LeanCamp Madrid 2012)
Metrics. Because everything COUNTS (LeanCamp Madrid 2012)
Metrics. Because everything COUNTS (LeanCamp Madrid 2012)
Metrics. Because everything COUNTS (LeanCamp Madrid 2012)
Metrics. Because everything COUNTS (LeanCamp Madrid 2012)
Metrics. Because everything COUNTS (LeanCamp Madrid 2012)
Metrics. Because everything COUNTS (LeanCamp Madrid 2012)
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Metrics. Because everything COUNTS (LeanCamp Madrid 2012)

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Keynote presentation at LeanCamp Madrid 2012. Metrics are key for every startup. This presentation shows some basics about metrics and analytics, with specific examples about how they're being used in 24symbols, a publishing-related startup.

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  • 10. And why do they read more and more? Because we already have more than 80 publishers that provide commercial, bestselling titles. Titles that you can find in the bookstore&apos;s main tables. Here in the UK we are starting to have extremely interesting publishers collaborating with us, such as Profile, Canongate, No Exit Press or Parkstone International
  • Metrics. Because everything COUNTS (LeanCamp Madrid 2012)

    1. 1. Startup metrics:because everything counts Justo Hidalgo jhidalgo@24symbols.com @justohidalgo
    2. 2. Let’s talk about metrics andstartups!
    3. 3. Watch this…500startups’ Dave McClure
    4. 4. … and this!Carsonified’s Ryan Carson
    5. 5. Hi!■ Co-founder,■ Data Integration and Management, Product Strategy and Innovation■ Ph.D. in Computer Science on Data Integration and Web Automation■ Ergo: Love Data ■ @justohidalgo
    6. 6. 24symbols is a service to read digital books on the Internet based on a subscription model = cloud + social + freemium@justohidalgo
    7. 7. 40000 45000 50000 55000 60000 65000 70000 75000 80000 85000 Nov-11 Dec-11 Jan-12 Feb-12 Mar-12@justohidalgo Apr-12 May-12 Jun-12 Jul-12 Aug-12 Sep-12
    8. 8. My goals today Metrics are important Metrics are useful in many dimensions. Start from day 1 There are some “standards” but focus on actionable metrics Get feedback from your experience!
    9. 9. What I won’t talk about A/B Testing Qualitative measurement • Competitive landscape, UX quality, … Standard financial metrics • Revenue, Balance, Burn rate, Runway, … All possible metrics in the world • As many as asses
    10. 10. AARRRAcquire Activate Retain Refer Get RevenueSEO Landing Content Campaigns ShoppingSEM Page (blogs, Emails cartCampaigns Product articles, … SubscriptionsEmail Features …) Lead GenBlogs … Emails …… Alerts … traffic social business
    11. 11. AARRR is great for starters…… but focused on linear acquisition flow
    12. 12. Traffic Metrics
    13. 13. Acquisition How do people find your site?
    14. 14. @justohidalgo
    15. 15. 15 seconds in “La 1”
    16. 16. MetricsNumber of visits Distributions (per browser, region, …)Bounce rate Number of page views
    17. 17. Pivots? Customer-segment pivot But always… Cohort Analysis and Segmentation!!!!
    18. 18. AActivation How sticky is your site?
    19. 19. Metrics # Sign ins!!! Recency (time since user did85000 something meaningful)800007500070000650006000055000500004500040000 Time per page Time on site (and churn as well!!!)
    20. 20. Pivots? Channel pivot Needed faster growth But 0€ for marketing! Content is critical but it cannot be an excuse 3rd party channels to increase breadth and virality
    21. 21. Biggest Apple Reseller in Spain 1-year subscription to 24s per iPad/Mac purchased@justohidalgo
    22. 22. AARetention Why do users come back?
    23. 23. Metrics. The standard ones… Number of unique/returning visitors Visits over time Average session time
    24. 24. … engagement… D/WAU: Daily/Weekly Active Users MAU: Monthly Active Users D/WAU Stickiness = MAU
    25. 25. … but also domain-specific!!! # Active readers # Books read per user Pages read per active reader per month Pages read per paid user per month
    26. 26. Pivots? Not yet, but: • Retention and engagement through FB is extremely tough • A confirmation: engagement is directly proportional to content
    27. 27. 85+ publishers, 10+ in UK and growing@justohidalgo
    28. 28. Social Metrics
    29. 29. AARReferral Do people talk about your site?
    30. 30. Types of users Visitor Contributor Distributor
    31. 31. ViralityAmplification rate:• (#shares, #RTs, …)K-Factor = AR *conversion rate• = 1: steady state• > 1: growth ➤ 1.4 < x < 2.1 => hot & viral!!!• < 1: decline
    32. 32. The Four Viral App Objectives % viral hosts Contact rate per active host Duration of each active host’s infectious time period Infection conversionSource: http://framethink.wordpress.com/2008/01/15/the-four-viral-app-objectives-aka-social-network-application-virality-101/
    33. 33. Pivots? Engine of growth pivot 1st: Let’s use SEM, … • Expensive • Might use it, but carefully A few campaigns have shown the value of virality. Focus now: ➤Product built-in viral campaigns (member-get-member) ➤Carefully measure each campaign and see “what sticks” ➤Work on Amplification Rate ➤Improve and enhance the social experience (but watch out!!!)
    34. 34. @justohidalgo
    35. 35. Business Metrics
    36. 36. AARRRevenue Do you make money?
    37. 37. 3 metrics for SaaS CMRR LTV CACR
    38. 38. Churn
    39. 39. CMRR SaaS = recurring revenues CMRR = Committed Monthly Recurring Revenue • Recurring + new accounts + new upsells – churn
    40. 40. LTV ARPU * 100% Churn rate Lifetime Value =Source: http://blog.kissmetrics.com/how-to-calculate-lifetime-value/
    41. 41. Customer Acquisition Cost gross margin per customer CAC Ratio= sales/marketing costs per customer Bessemer: average ratio of SaaS companies = 0.6
    42. 42. LTV vs CAC Of course, LTV > CAC But, moreover: LTV > 3x CAC
    43. 43. Freemium. Conversion Rate Free Users Delayed subscription Premium (test the service & engage) Conversion Rate Time@justohidalgo
    44. 44. Freemium for Books. Price per page Price/page Profit threshold Growth Consolidation time/conversion rate@justohidalgo
    45. 45. Pivots? Too soon, but… Channel pivothttp://www.businessinsider.com/state-of-internet-slides-2012-10?op=1
    46. 46. Tools
    47. 47. Conclusions
    48. 48. @justohidalgo
    49. 49. 2. Have someone taking care of it
    50. 50. 3. Only measure what you truly care about@justohidalgo
    51. 51. But again, choose right
    52. 52. 4. Beware vanity metrics…
    53. 53. … they may hide an awful truth
    54. 54. Thanks for your time!Justo Hidalgohttp://www.loscuentosdelabuelo.comjhidalgo@24symbols.com@justohidalgo
    55. 55. Credits Olivier Guin, from The Noun Project Dima Yagnyuk, from The Noun Project Redesign from Otl Aicher’s icon, from The Noun Project Axsys, from The Noun Project Monika Ciapala, from The Noun Project Rob Schill, from The Noun Project Martin Karachorov, from The Noun Project Alexandre Mendes, from The Noun Project All other icons from The Noun Project Publishers trademarks, logos and brands belong to their respective companies.

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