1mGTM #6 - Unlock Your Growth Metrics

TL;DR: You've got two types of metrics: ones that show you the results (lagging) and ones that show you what actions to take (leading). Focus on the actions, and the results will follow. Lagging indicators are what your investors want to see. Leading indicators are what your team needs to focus on to drive real growth.

Stop Chasing Your Tail: The Right Way to Use Startup Metrics

Ever feel like you're running in circles with your startup metrics? You're staring at your Monthly Recurring Revenue (MRR), willing it to go up, but it's just… stuck. That's because you're likely focusing on the wrong thing.

It is like looking at the cake and trying to make it better without tweaking the recipe or baking process. It does not work.

You need to understand one core idea: There are metrics you want to see grow (lagging), and there are metrics you actually need to work on (leading).

The difference is night and day. It's the shift from feeling clueless to knowing exactly what levers to pull to grow your business. Get this right, and you'll start seeing real progress.

Lagging Indicators: The "What" (For Your Investors)

These are your outcome metrics. They tell you what happened. Think of them as the scoreboard. These are the numbers your investors care about. They paint the big picture of your company's performance.

Here's how Y Combinator breaks it down for different businesses:

B2B Lagging KPIs:

• MRR (Monthly Recurring Revenue): Number of paying customers × Average Contract Value.

• Customer Churn: Number of customers lost ÷ total number of customers.

• LTV (Lifetime Value): Average monthly profit per customer × average retention length (in months).

B2C SaaS Lagging KPIs:

• DAU/MAU (Daily/Monthly Active Users): Number of unique users actively engaging with your product daily or monthly.

• Retention: Percentage of users who continue using your product after their first week or month.

• Churn: Number of users lost ÷ total number of users.

These are great for seeing the big picture. But they don't tell you how to improve, and they're not what your team should be obsessing over day-to-day.

Leading Indicators: The "How" (For Your Team)

These are your input metrics. They tell you how to get the results you want. They are your recipe for success. These are the metrics your team needs to live and breathe. They're the actionable items that drive progress.

Example Leading Indicators:

• To boost B2B MRR: Track things like the number of sales calls made, demo conversion rate, or content downloads.

• To boost B2C SaaS DAU/MAU: Focus on metrics like onboarding completion rates, in-app engagement (time spent, features used), and frequency of use.

• To lower B2B Churn: Look at onboarding completion rates, product usage frequency, or customer support interactions.

• To increase B2C SaaS Retention: Track metrics like product feature adoption rates, subscription renewals from free-trial and positive customer support interactions.

• To raise B2B LTV: Track customer health scores and identify at-risk customers for proactive outreach.

How to Make It Work For You

Start by breaking down your big goals into smaller, actionable steps. If you want more MRR, figure out exactly what drives it. Is it more sales calls? Better onboarding? More engaging content?

Track those leading indicators. Experiment with them. Optimize them. If you are in doubt - think about the cake. Once you focus on the inputs, the outputs will take care of themselves. You'll start to see that growth you've been chasing, and your investors will be happy too.

Your Free SaaS Metrics Cheat Sheet & Calculator

Ready to dive deeper? Grab your free copy of our SaaS Metrics Cheat Sheet & Calculator here:

It's packed with even more metrics, definitions, and a handy calculator to help you track your progress. Don't miss out!