Setting the right KPIs and focusing on MRR will help prioritize strategies and measure the value delivered to customers.

• 📊
  00:00

  Setting the right KPIs and focusing on MRR will help you measure and prioritize the value you're delivering to customers.

  • Setting the right KPIs and goals will objectively tell you if your business is doing well, bad, or just okay, and help you prioritize and course correct.
  • Pick one primary metric to focus on that quantifies the value you're delivering to customers.
  • Revenue is the best metric to measure value, and MRR (Monthly Recurring Revenue) is a good indication of whether a product is delivering enduring value to users.
• 💰
  03:35

  Pick a lagging indicator of success (e.g. revenue or active users) to prioritize strategies and make decisions quickly in a startup.

  • Pick a primary metric that is a lagging indicator of success to best represent real value.
  • Revenue or active users are the two primary metrics to pick from when trying to prioritize strategies and make decisions quickly in a startup.
• 🤑
  05:45

  Use revenue as the primary metric to test product success, and define users appropriately to avoid being tricked by an easy definition.

  • 99% of people should use revenue as their primary metric to test whether people want their product and to avoid the trap of getting feedback from free users.
  • Building a large audience is a prerequisite for modernization, and active users can be a reasonable proxy for revenue, especially if there are strong network effects.
  • It is important to define user appropriately and not trick yourself by having an easy definition of users, especially when there are two types of users in a marketplace.
• 🤝
  08:58

  Choose a primary metric and 3-5 secondary metrics to get a 360 degree overview of the health of your business.

  • Pick a value that represents both users getting value, such as weekly trips for Uber riders and drivers, or revenue/active users for biotech/hard tech businesses.
  • For businesses with regulatory issues, the primary metric is a binary thing, while for those without, revenue should be the primary metric.
  • Figure out the technical milestones needed to demonstrate the effectiveness of a drug or technology and ask questions to answer if it works.
  • Choose 3-5 secondary metrics to pair with your primary metric to get a 360 degree overview of the health of your company.
• 📈
  12:41

  Focus on getting the immediate goal of a hundred users each week, and track 3-5 metrics to measure growth at a rate of 5-10% week over week.

  • Pick 3-5 metrics to track, but don't try to optimize too many at once or you'll suffer from analysis paralysis.
  • Before launching, focus on defining your primary metric and user to get everyone on the same page.
  • The goal of a startup is to grow its primary metric, proving that it is making something people want.
  • Focus on getting the immediate goal of a hundred users each week, and don't worry about the eventual goal of 10,000 users too soon.
  • Recent YC startups have grown at a rate of 5-10% week over week, equating to 20-50% month over month and a multiple of 1-2x year over year.
• 🤔
  17:00

  When setting goals for consumer startups, factor in the time it takes to acquire users and make a sale.

  • For consumer startups, consider the time it takes to acquire users and make a sale when setting goals, as initial growth is usually fast but slows down over time.
  • I decide to buy or sign up for an app/website instantly if I want it.
• 📈
  18:46

  Prioritize ideas to grow your business and set weekly targets to ensure you're working on the right idea to meet your goal.

  • It may take months to make your first sale, but focus on organic growth and avoid paid users in the early days to ensure your startup's growth.
  • Pick an exponential growth rate or time-box an absolute goal, track progress with metrics and use it as a motivational tool by printing out a graph and putting it everywhere.
  • Weekly, prioritize ideas to grow your business and make a good guess on what will have the biggest impact to meet your goal.
  • Set weekly targets and be honest about where you are to ensure you're working on the right idea.
• 💡
  22:41

  Use the given software to get into the habit of filling out notes and adding it to your workflow to help you and change things dramatically.