Key Performance Indicators (KPIs) measure progress toward long-term business objectives. Unlike general metrics, KPIs focus on the critical priorities and initiatives that drive your business, allowing you to set the course for success.
For startups, KPIs serve as benchmarks for specific targets or goals that your team is striving to achieve. These indicators are typically built around key metrics that have the most significant impact on reaching your overarching business objectives.
1) MRR (Monthly Recurring Revenue)
The amount of revenue you make that recurs monthly
2) ARR (Annual Recurring Revenue)
The amount of revenue you receive that recurs yearly
3) ARPA (Annual Revenue per Account)
MRR / Total # of Customers
4) Gross Profit
Total revenue minus the cost of goods sold
5) TCV (Total Contract Value)
Value of one-time and recurring charges
6) ACV (Annual Contract Value)
The value that a contract will bring to your business annually
7) LTV (Lifetime Value)
Prediction of the net profit from the entire future relationship with a customer
8) Deferred Revenue
Amount that was received by a company in advance of earning it
9) Billings
Current quarterly revenue + deferred revenue from the previous quarter
10) CAC (Customer Acquisition Cost)
How much it costs, on average, to acquire a customer
11) CCR (Customer Concentration Risk)
Revenue from largest customer / total revenue
12) DAU (Daily Active Users)
The number of users that return to your startup’s site or app on a daily basis
13) MAU (Monthly Active Users)
The number of users that return to your startup’s site or app on a monthly basis
14) Number of Logins
The amount of times users have logged in to your portal
15) Activation Rate
Number of users taking a specific action to get value out of a product
16) MoM (Month-on-Month Growth)
The rate of growth from month to month, comparing the the current month or past 30 days to the previous month or last 31 to 60 days.
17) CMGR (Compounded Monthly Growth Rate)
(Latest Month/First Month) ^ (1 / # of Months) – 1
18) MCR (Monthly Churn Rate)
Lost customers this month / prior month total
19) Retention by Cohort
% of original installed base (1st month) that are still transacting
20) GCR (Gross Churn Rate)
MRR lost in a given month / MRR at the beginning of the month
21) Net Churn
(MRR lost – MRR from upsells) this month / MRR at the beginning of the month
22) Monthly Cash Burn Rate
How much money you spend per month (gross)
23) Net Burn Rate
Revenues – gross burn
24) Gross Burn
Monthly expenses + any other cash outlays
25) TAM (Total Addressable Market)
Revenue opportunity available for a product
26) ARR (Annual Run Rate)
Projection of current MRR into the future, annualised
27) Gross Margin
Difference between revenue and cost of goods sold
28) Sell-Through Rate
Number of units sold in a period/number of items at the beginning of the period
29) Network Effects
Effect of one user on the value of that product to other people (example: Metcalfe’s Law)
30) Virality
Viral coefficient = average number of invitations sent existing user * conversion rate of invitation
31) NPS (Net Promoter Score)
How likely user is to recommend your product to a friend
32) Platform Risk
Dependence on a specific platform or channel
33) Direct Traffic
Traffic coming directly to your site via a link or entering the URL
34) Organic Traffic
Unpaid traffic from search results