A16Z has a great post up titled 16 Startup Metrics that outlines many of key metrics investors look for and entrepreneurs often get incorrect. I’m guilty of this: when I went into one of my first investor pitches 10 years ago, I talked about revenue when it really was bookings, and the VC politely corrected me.
Here are the 16 metrics to test your knowledge before reading 16 Startup Metrics:
- Bookings vs. revenue
- Recurring revenue vs. total revenue
- Gross profit
- Total contract value vs. annual contract value
- Lifetime value
- Gross merchandise value vs. revenue
- Unearned or deferred revenue … and billings
- Customer acquisition cost … blended vs. paid, organic vs. inorganic
- Active users
- Month-on-month growth
- Burn rate
- Cumulative charts (vs. growth metrics)
- Chart tricks
- Order of operations
Every entrepreneur should read 16 Startup Metrics and understand the metrics applicable to their startup.
What else? What are some more startup metrics that are important?