What is the most important metric for early-stage startup?
Can you choose between:
CAC (customer acquisition cost)
CR (churn rate)
LTV (lifetime value)
Can you choose between:
CAC (customer acquisition cost)
CR (churn rate)
LTV (lifetime value)
Is the founder happy? :)
If the company fails, he probably isn't.
I was almost going to answer MRR but yeah, you are right. Anyway isn't the founder always happy in early stage ? :)
NPS is good as you want to solve a problem that is VERY painful for customers.
When we launched https://www.joinsecret.com/ our users' feedback were amazing. They were so excited to be able to save $$$ on the best software for their startups. The problem you are solving the #1 thing that matters when you start I would say
Net Promoter Score, surely?
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Revenue/MRR. Which one? It depends on your business model. The exceptions is for content websites and social network, where the metric are DAUs and MAUs.
CAC is a bad metric. If you enter a market with low competition and build a profitable business, your CAC will increase a lot in time and in general it increases even without competition.
Churn is something that requires time to improve and involves tweaking many variables, aspects that usually startups haven't figured out and are not expected to have.
LTV is heavily influenced by churn so it is another metric that I wouldn't consider for a startup.
I am talking about SaaS startup! I agree with you about cac, I think that this metric is not very suitable for early-stage!
But as for churn I wouldn't agree if startup has a comprehensive analytics and cusdev! What do you think?
For a Saas startup MRR is the key metric. Clearly you can use other metrics as a support but MRR gives you the idea of customers' willingness to pay and market size (the MRR of all the companies in your market, if you are able to find the data) plus the trend (is the market growing or shrinking?). Honestly, I woukd focus on that.
Churn is not bad at all and if you are able to reduce it, it's a great feat considering the fact that most of revenue comes from repeting customers, upsells to current customer and the trend is upwards. I would argue that churn is the go-to-metric if you feel like you are close to esausting the potential demand but if you are lots of potential customers out there i would go with MRR. I higher MRR means also more chance to improve your funnel and could reduce your churn. On the contrary, there will always be a percentage of your churn that, no matter what you do, will churn anyways so you margin of improvement on that side are usually more limited.
MMR
Not in the option
Early stage? Assuming you have no money, I'd say CAC.
it is obvious that cac is very high for early stage startups!