Introduction
I always struggle to stay focussed. Often, I find myself spending time on activities that don’t yield the highest return. Development is secondary and building the right it, iterating fast, and getting in touch with users who will pay for your software product is the ultimate bottleneck at least for people like me. To address this problem I am making a list of activities that other notable and even lesser known startups did to hack or achieve growth and product market fit. My main goal here is that I can daily or bi-weekly review this list to keep my startup efforts on track and ensure that I am spending my time on the right things.
Startup Metrics, OKRs, and KPIs
The AARRR framework is a customer acquisition model that stands for: Acquisition, Activation, Retention, Referral, and Revenue. It helps startups to understand the key performance indicators (KPIs) that they need to track in order to grow their customer base. Here is a table that provides example KPIs for each component of the AARRR framework:
| Component | KPI | Explanation |
| Acquisition | Traffic | The number of visitors to your website or app |
| Conversion Rate | The percentage of visitors who take a desired action (e.g. sign up or make a purchase) | |
| Cost per Acquisition (CPA) | The cost of acquiring a new customer | |
| Bounce Rate | The percentage of visitors who leave your website or app after only visiting one page | |
| Click-through Rate (CTR) | The percentage of visitors who click on a specific link or button on your website or app | |
| Lead-to-customer Ratio | The ratio of leads generated to customers acquired | |
| Activation | Activation Rate | The percentage of new users who take a desired action (e.g. complete a tutorial or make a purchase) |
| Engagement Rate | The percentage of users who are active in your product | |
| Feature Adoption | The percentage of users who have adopted a specific feature or set of features | |
| Time to First Value (TTV) | The time it takes for a new user to generate value for the business | |
| Retention | Retention Rate | The percentage of users who continue to use your product over a specific period of time |
| Churn Rate | The percentage of users who stop using your product over a specific period of time | |
| Repeat Purchase Rate | The percentage of customers who make repeat purchases | |
| Time to Churn | The time it takes for a customer to stop using the product or service | |
| Referral | Referral Rate | The percentage of users who refer others to your product |
| Net Promoter Score (NPS) | A measure of customer loyalty and advocacy | |
| Referral Conversion Rate | The percentage of referred users who convert into customers | |
| Referral Revenue | The revenue generated from referred customers | |
| Revenue | Monthly Recurring Revenue (MRR) | The amount of revenue generated by your product on a monthly basis |
| Lifetime Value (LTV) | The total revenue generated by a customer over their lifetime | |
| Average Revenue per User (ARPU) | The average amount of revenue generated per user | |
| Gross Margin | The difference between the revenue and cost of goods sold (COGS) | |
| Customer Acquisition Cost (CAC) | The cost of acquiring a new customer, including marketing and sales expenses | |
| Lifetime Value to CAC Ratio (LTV:CAC) | The ratio of a customer’s lifetime value to the cost of acquiring them |
Here’s an updated table that lists KPI, the associated component, and explanation, examples of OKRs for that KPI, and a task list on how to boost that KPI:
| KPI | Component | Explanation | OKRs Examples | Task List |
| Organic Search Traffic | Acquisition | The number of visitors to your website or app that came from organic search results | Increase organic search traffic by 20% in the next quarter | 1. Conduct a keyword research to identify the most relevant keywords for your business. 2. Optimize the website content for those keywords. 3. Build backlinks from reputable websites. 4. Monitor and measure the progress regularly. |
| Customer Satisfaction (CSAT) | Retention | A metric that measures how satisfied customers are with a product or service | Improve customer satisfaction by 15% in the next quarter | 1. Conduct customer satisfaction surveys to understand customer pain points. 2. Implement customer service improvements based on feedback. 3. Monitor customer support interactions and provide training when necessary. 4. Send out customer satisfaction surveys regularly. |
| Revenue Growth Rate | Revenue | The rate at which a business’s revenue is growing | Increase revenue growth rate by 25% in the next quarter | 1. Identify new revenue streams. 2. Implement upselling and cross-selling strategies. 3. Optimize pricing strategy. 4. Monitor the progress and make adjustments when necessary. |
| Subscription Renewal Rate | Retention | The percentage of subscribers who renew their subscriptions | Increase subscription renewal rate by 10% in the next quarter | 1. Send out reminders for subscription renewal. 2. Send out surveys to understand why customers are not renewing. 3. Implement loyalty programs for repeat customers. 4. Monitor the progress and make adjustments when necessary. |
| Email Open Rate | Acquisition | The percentage of recipients who opened an email campaign | Increase email open rate by 30% in the next quarter | 1. Segment the email list to target specific groups of customers. 2. Test different subject lines and email content. 3. Monitor the progress and adjust the email frequency if necessary. 4. Implement an email automation strategy. |
| Viral Coefficient | Referral | A metric that measures how many new users are brought in by each existing user | Improve viral coefficient by 50% in the next quarter | 1. Implement referral programs. 2. Add social sharing buttons to the website. 3. Encourage users to share the product or service. 4. Monitor the progress and make adjustments when necessary. |
| Gross Margin | Revenue | The difference between the revenue and cost of goods sold (COGS) | Increase gross margin by 10% in the next quarter | 1. Optimize pricing strategy. 2. Reduce production or operational costs. 3. Increase sales or revenue. 4. Monitor the progress and make adjustments when necessary. |
| Time to First Value (TTV) | Activation | The time it takes for a new user to generate value for the business | Reduce TTV by 25% in the next quarter | 1. Implement an onboarding process. 2. Add a tutorial or a walk-through of the product or service. 3. Provide customer support. 4. Monitor the progress and make adjustments when necessary. |
| Bounce Rate | Acquisition | The percentage of visitors who leave your website or app after only visiting one page | Reduce bounce rate by 20% in the next quarter | 1. Optimize website design and user experience. 2. Improve website load speed. 3. Monitor the progress and make adjustments when necessary. 4. Use heat maps and analytics to understand the user behavior. |
| Affiliate Revenue | Referral | The revenue generated from affiliate partnerships | Increase affiliate revenue by 50% in the next quarter | 1. Identify potential affiliate partners. 2. Develop an affiliate program. 3. Monitor the progress and make adjustments when necessary. 4. Provide support and resources for affiliates. |
| Lead-to-customer Ratio | Acquisition | The ratio of leads generated to customers acquired | Improve lead-to-customer ratio by 25% in the next quarter | 1. Optimize lead generation campaigns. 2. Implement lead nurturing strategies. 3. Monitor the progress and make adjustments when necessary. 4. Implement a CRM system to manage leads effectively. |
| Time to Churn | Retention | The time it takes for a customer to stop using the product or service | Reduce time to churn by 20% in the next quarter | 1. Identify the reasons for churn. 2. Implement retention strategies. 3. Monitor the progress and make adjustments when necessary. 4. Implement a loyalty program. |
| Repeat Purchase Rate | Retention | The percentage of customers who make repeat purchases | Increase repeat purchase rate by 15% in the next quarter | 1. Implement upselling and cross-selling strategies. 2. Implement a loyalty program. 3. Monitor the progress and make adjustments when necessary. 4. Provide excellent customer service. |
| Customer Acquisition Cost (CAC) | Revenue | The cost of acquiring a new customer, including marketing and sales expenses | Reduce CAC by 20% in the next quarter | 1. Optimize the marketing and sales strategy. 2. Identify the most cost-effective channels. 3. Monitor the progress and make adjustments when necessary. 4. Implement a CRM system to manage leads effectively. |
| Lifetime Value to CAC Ratio (LTV:CAC) | Revenue | The ratio of a customer’s lifetime value to the cost of acquiring them | Improve LTV:CAC ratio by 30% in the next quarter | 1. Implement a CRM system to manage customer data. 2. Identify the most profitable customer segments. 3. Monitor the progress and make adjustments when necessary. 4. Implement retention strategies. |
Additional KPI examples for startups in the pre-product market fit stage:
| KPI | Component | Explanation | OKRs Examples | Task List |
| Monthly Active Users (MAU) | Activation | The number of unique users who engage with the product or service in a given month | Increase monthly active users by 50% in the next quarter | 1. Optimize user onboarding process. 2. Implement user engagement strategies. 3. Monitor the progress and make adjustments when necessary. 4. Track user behavior using analytics tools. |
| Net Promoter Score (NPS) | Referral | A metric that measures how likely customers are to recommend the product or service to others | Improve NPS by 20% in the next quarter | 1. Send out NPS surveys. 2. Identify the reasons for low NPS scores. 3. Implement improvements based on feedback. 4. Monitor the progress and make adjustments when necessary. |
| Product/Market Fit Score | Acquisition | A metric that measures the fit between the product and the market | Achieve a product/market fit score of 50 in the next quarter | 1. Conduct market research. 2. Identify the target market. 3. Implement a minimum viable product (MVP) strategy. 4. Monitor the progress and make adjustments when necessary. |
| Feature Adoption | Activation | The percentage of users who have adopted a specific feature or set of features | Increase feature adoption by 50% in the next quarter | 1. Identify the most important features. 2. Optimize the user interface and user experience. 3. Monitor the progress and make adjustments when necessary. 4. Implement a tutorial or a walk-through of the feature. |
| Customer Feedback | Acquisition | The feedback received from customers about the product or service | Collect feedback from at least 50 customers in the next quarter | 1. Implement a feedback collection system. 2. Monitor customer interactions and collect feedback. 3. Analyze feedback and make adjustments to the product or service. 4. Communicate changes to customers and monitor the impact. |
| Monthly New Users | Acquisition | The number of new users that engage with the product or service in a given month | Increase monthly new users by 30% in the next quarter | 1. Optimize user acquisition strategies. 2. Implement a referral program. 3. Monitor the progress and make adjustments when necessary. 4. Track user behavior using analytics tools. |
| Cost per Acquisition (CPA) | Acquisition | The cost of acquiring a new user, including marketing and sales expenses | Reduce CPA by 30% in the next quarter | 1. Optimize the user acquisition strategies. 2. Identify the most cost-effective channels. 3. Monitor the progress and make adjustments when necessary. 4. Implement a CRM system to manage leads effectively. |
| Product Usage | Activation | The percentage of users who are actively using the product or service | Increase product usage by 20% in the next quarter | 1. Implement a onboarding process. 2. Add a tutorial or a walk-through of the product or service. 3. Monitor user behavior using analytics tools. 4. Provide customer support. |
Things you should be spending time on
What I suggest is review this list regularly, take a print out, and fill the priority section. Your goal is not to do all of these at once, but instead pick an item from this that will result in boosting your startup metrics.
| Task Details | Task Short | Priority |
| Attending industry events | Attending industry events | |
| Spend time finding influencers, Reach out to influencers in your industry to promote your product and increase brand awareness (micro-influencers to promote the platform and increase brand awareness). They targeted webmasters, website owners, and targeted them through online forums, directories and other websites. | finding influencers | |
| Create eBooks and valuable and informative content to attract potential customers and establish themselves as thought leaders in their industry. | Create eBooks, blog posts | |
| Create Referral program to incentivise them to refer their friends and family (e.g. Dropbox additional storage space for every friend they referred) | Referral Programs | |
| Cold emailing to leads (LinkedIn, ZoomInfo, Reddit chat) | Lead generation by Email | |
| Email Marketing Newsletter, Articles, Webinars, etc. | Mautic, Mailchimp Email Campaigns | |
| Paid advertising: FB ads, Google Ads, Reddit ads, Bing ads, etc. | Ad Campaigns | |
| Predotyping: create fake events, and fake product demos from mockups | Landing Pages, Mockups, Demo Videos | |
| Leverage existing networks – your own friends and family to get intros or use the product | Connect with friends, ask for intros | |
| Focus on a specific niche, find the specific niche (e.g. MERN developers, Google Spreadsheet users, Google Marketplace). Spend time in finding existing networks, like eBay sellers. | Constantly narrowing down your beachhead or target niche | |
| Getting users to create content (e.g. uploading images, adding test cases, etc.), somehow getting users to create or add things | Thinking of ways to make users invest in your product, Skin in the game | |
| Optimise the user flow to get to the AHA movement | Thinking of ways for users to experience AHA movement | |
| Create Social Proof and leverage, show the reviews, likes and ratings of your product to get more users. | Asking for reviews, likes, etc. | |
| Allowing people to invite others | Creating incentive programs | |
| Leverage Facebook, apple, and google play app stores | Create app for other ecosystems | |
| Create a browser extension, plugins, or google workplace marketplace listing | Create app for other ecosystems | |
| Conduct Polls to get qualified leads, conduct user interviews, and surveys, and lead qualification | User Interviews, and Polls | |
| Target conference attendees of your relevant audience | Cold emailing leads from conference attendees | |
| Target companies that post a job | Cold emailing leads from companies who posted a job | |
| Organise a webinar, reach out to speakers and experts | Webinar | |
| Include a CTA (call to action) in every communication | CTA, Payment, Subscribe | |
| Used data analytics to better understand their users and to optimize their growth strategies. First measure the KPIs and then track them. | KPI Measurement and Tracking | |
| SEO – Optimise the website, landing page and the articles | SEO | |
| Find companies that will benefit from your partnership. Formed partnerships with other companies and organizations to drive awareness and attract new users. | Partnerships | |
| Facebook retargeting – Used re-marketing to target users who had previously shown interest in the product, with personalized ads and promotions to drive conversions | Retargetting | |
| Find local groups, events and meet-ups, do local community building, by organising meet-ups | Local Community Events | |
| Leverage an existing growing platform (WhatsApp, TikTok, VR/AR, etc) | ||
| Identify the popular creators of the platform and then use them to promote the app, conduct professional development, and increase brand awareness | Influencers | |
| Conduct professional training and offer certifications to your target niche | Courses, Training, Certiifications | |
| Incorporate gaming elements in the product to increase retention. Offer points, leaderboards, and rewards. | Gaming | |
| Try to get media coverage, reach out to PR firms, write a guest post. Find ways to get guest posting done. | Guest Posting | |
| Create an affiliate marketing program and list your product in affiliates, incentivise bloggers, tiktokers, etc. | Affiliate Incentive | |
| Spend time talking to users of their frustrations with existing software or around the problem domain | Interviewing around Frustration, MOMs test | |
| Launch the MVP and get people to try the product and learn from that | MVP development and testing |
Example of SAAS startups, the pain point, competition and the marketing message.
This section is largely for motivation and anchor your thoughts. I have added some empty rows in the end so you can fill that for your own startup. It is important to note there that the marketing message focusses on the broader problem. Your startup might be building an AI solution that does unit test case generation but you should talk about the problem or pain point which is faster deployment, bug free stable software.
| Startup | Pain point | Competition | Marketing Message |
| Salesforce | Managing customer data in one central location, it was difficult for sales team to manage and track customer interactions, leads, and sales data across different departments and teams. Salesforce first MVP was a cloud-based CRM software that centralize all the customer data in one platform. | Traditional CRM software and spreadsheets | “Revolutionize the way you manage customer relationships” |
| Zoom | High-quality video conferencing for remote teams, it was difficult to have a face-to-face conversations with team members working remotely, Zoom first MVP was a platform that offered high-quality video conferencing and screen sharing for remote teams. | WebEx, GoToMeeting, and other video conferencing tools | “Bring your remote team together with high-quality video conferencing” |
| Slack | Improving team communication and collaboration, it was difficult for teams to keep track of conversations, files, and notifications in different apps and email threads, Slack first MVP was a platform that centralized team communication and collaboration in one place. | “Transform the way your team communicates and collaborates” | |
| Hubspot | Inbound marketing and sales automation, it was difficult for small businesses to afford expensive marketing and sales software, Hubspot first MVP was a platform that offered inbound marketing and sales automation tools at an affordable price. | “Grow your business with inbound marketing and sales software” | |
| Workday | Streamlining human capital management, it was difficult for HR departments to keep track of employee data, benefits, and payroll, Workday first MVP was a cloud-based HCM software that streamlines all HR processes in one platform. | “Streamline your human capital management with our innovative software” | |
|
|
|||
|
|
|||
|
|
|||
|
|
Customer Persona of Beachhead
| SaaS Startup | Customer Persona of Beachhead |
| Dropbox | Early adopters, tech-savvy individuals, and small businesses looking for an easy and secure way to store and share files online. |
| Airbnb | Budget-conscious travelers looking for alternative and affordable accommodation options. |
| Uber | Urban, tech-savvy individuals looking for a more convenient and reliable transportation option. |
| Grammarly | Professional writers, bloggers, and students, who need to check and improve their grammar and spelling. |
| Salesforce | Salespeople, small businesses, and enterprise companies looking for an all-in-one CRM solution. |
| Zoom | Universities, online learning platforms, and remote teams looking for a reliable video conferencing solution. |
| Slack | Remote teams, startups, and small businesses looking for an easy-to-use team collaboration tool. |
| Hubspot | Small businesses, startups, and marketers looking for an all-in-one marketing and sales platform. |
| Asana | Small businesses, startups and remote teams looking for a project management tool |
| Airtable | Small businesses, startups, and remote teams looking for a flexible, spreadsheet-database hybrid tool |
| Shopify | Small businesses and entrepreneurs looking for an e-commerce platform to set up and manage an online store. |
| Canva | Non-designers, small businesses, and individuals looking for a simple and user-friendly graphic design tool. |
| MailChimp | Small businesses, non-technical individuals and entrepreneurs looking for an easy-to-use email marketing tool. |
| Trello | Project managers, remote teams and small businesses looking for a visual project management tool. |
| Evernote | Productivity enthusiasts, students and professionals who need to organize their notes, ideas and tasks. |
| Substack | Writers, journalists and bloggers who want to create and monetize their own newsletter. |
| Hunter.io | Salespeople, recruiters and marketers looking for a tool to find email addresses. |
| Calendly | Salespeople, recruiters and professionals who need to schedule meetings. |
How they found and verified their early target market persona
This section is primarily there to serve as a reminder and a motivation to help you understand how to pick a startup idea and how to stay motivated in your vision.
| SssA Startup | How they found their early target market persona | How they verified their pain point and connected with others who had that problem |
| Dropbox | Drew Houston, Dropbox’s CEO and Co-Founder, found his target market persona by observing the pain points of his own personal experience as a user of file-sharing services. | Drew Houston verified his pain point by talking to friends, colleagues, and other potential users to understand their frustrations with existing file-sharing services. He then created a simple solution that addressed these pain points and got feedback from early users to iterate and improve the product. |
| Airbnb | The founders of Airbnb, Brian Chesky and Joe Gebbia, found their target market persona by observing the pain points of attendees at a design conference who could not find a place to stay. They decided to convert their apartment into a bed and breakfast to accommodate the attendees and thus the idea of Airbnb was born. | The founders of Airbnb verified their pain point by talking to attendees at the design conference and understanding their needs and frustrations with finding accommodation. They then created a solution to meet those needs and got feedback from early users to iterate and improve the product. |
| Uber | Uber’s co-founder, Travis Kalanick, found his target market persona by observing the pain points of the taxi industry and the lack of options for hailing a ride on-demand in San Francisco. | Travis Kalanick verified his pain point by talking to friends, colleagues, and potential users in San Francisco to understand their frustrations with the taxi industry. He then created a solution that addressed these pain points and got feedback from early users to iterate and improve the product. |
| Zoom | The founder of Zoom, Eric Yuan, found his target market persona by observing the pain points of the existing video conferencing solutions in the market which were not user-friendly and not reliable. | He verified his pain point by talking to friends, colleagues, and potential users in the education and remote work communities to understand their frustrations with existing video conferencing solutions. He then created a solution that addressed these pain points and got feedback from early users to iterate and improve the product. |
| Canva | The founders of Canva found their target market persona by observing the pain points of people who needed to create graphic designs but lacked the skills or the tools to do so. | They verified their pain point by talking to friends, colleagues, and potential users in the small business and non-designer communities to understand their frustrations with existing graphic design tools. They then created a solution that addressed these pain points and got feedback from early users to iterate and improve the product. |
| MailChimp | The founders of MailChimp found their target market persona by observing the pain points of small businesses and non-technical individuals who needed to send bulk emails but lacked the skills or the tools to do so. | They verified their pain point by talking to friends, colleagues, and potential users in the small business and non-technical communities to understand their frustrations with existing email marketing tools. They then created a solution that addressed these pain points and got feedback from early users to iterate and improve the product. |
| Trello | The founders of Trello found their target market persona by observing the pain points of project managers and remote teams who needed to collaborate on projects but lacked the tools to do so. | They verified their pain point by talking to friends, colleagues, and potential users in the project management and remote work communities to understand their frustrations with existing collaboration tools. They then created a solution that addressed these pain points and got feedback from early users to iterate and improve the product. |
| Slack | The founders of Slack found their target market persona by observing the pain points of remote teams and small businesses who needed to communicate and collaborate but lacked the tools to do so. | They verified their pain point by talking to friends, colleagues, and potential users in the remote work and small business communities to understand their frustrations with existing communication and collaboration tools. They then created a solution that addressed these pain points and got feedback from early users to iterate and improve the product. |
| Evernote | The founder of Evernote, Phil Libin, found his target market persona by observing his own pain points of forgetfulness and disorganization. | He verified his pain point by talking to friends, colleagues, and potential users to understand their frustrations with existing note-taking and organization tools. He then created a solution that addressed these pain points and got feedback from early users to iterate and improve the product. |
| Substack | The founder of Substack, Hamish McKenzie, found his target market persona by observing the pain points of writers, journalists and bloggers who wanted to create and monetize their own newsletter but lacked the tools to do so. | He verified his pain point by talking to friends, colleagues, and potential users in the writing and journalism communities to understand their frustrations with existing newsletter platforms. He then created a solution that addressed these pain points and got feedback from early users to iterate and improve the product. |
| hunter.io | The founders of Hunter.io found their target market persona by observing the pain points of salespeople, recruiters and marketers who needed to find email addresses but lacked the tools to do so. | They verified their pain point by talking to friends, colleagues, and potential users in the sales, recruitment and marketing communities to understand their frustrations with existing email finding tools. They then created a solution that addressed these pain points and got feedback from early users to iterate and improve the product. |
| Calendly | The founder of Calendly, Tope Awotona, found his target market persona by observing the pain points of salespeople, recruiters and professionals who needed to schedule meetings but lacked the tools to do so. | He verified his pain point by talking to friends, colleagues, and potential users in the sales, recruitment |
|
|
||
|
|
||
|
|
||
|
|
Conclusion
I hope this document or guide serves as a means to help you achieve growth, product market fit and more importantly stay focussed. Startups are not a sprint but rather a marathon. Staying focussed, disciplined and consistent are paramount. In this guide we covered the key components to help you achieve that goal, the startup metric framework, KPIs, OKR, and Task Ideas, and made a list of things that you should be busy doing. Plus the guide has some motivation sections to help ensure that you don’t loose sight of how other startups got there.