After reading about the Simplified One Page Strategic Plan, one of the common questions I get is “when should we start tracking metrics in our startup?” Basic things like cash, burn rate, and customers/users should be tracked immediately, but what about the dozens of other things that can be tracked? Generally, my recommendation is to start getting more operationally focused once product/market fit is in place and the search for a repeatable customer acquisition model is on (see the four startup stages in eight words).
Here are a few more thoughts on when to start tracking operational metrics:
- Finding product/market fit is all about building a product that customers love and are passionate about — that’s the main focus for everyone on the team.
- Small teams (e.g. four people in a room) all know what’s going on. When the startup hits 10+ people, it’s time to add more metrics tracking and accountability (if not sooner).
- With more scale on the people side comes more need for scale on the metrics side (e.g. operational metrics for sales, marketing, engineering, support, operations, etc.)
- Start with something simple like a Google Spreadsheet KPIs Dashboard and iterate from there
Most startups never get to the point where they have to worry about operational metrics because they don’t get past the product/market fit phase. For the ones that do, consider three buckets of metrics: financial, employee happiness, and customer happiness. And, start simple with the operational metrics and add more over time.
What else? What are some more thoughts on when to start tracking operational metrics in a startup?