I've advised over 75 startups on growth.

The best companies track the right metrics.

Here's 9 metrics every Founder and Marketer should know:

1) Website Conversion Rate

The % of visitors who take a key action on your site.

A conversion is usually a sign-up or purchase.

Conversion Rate =  Number of conversions / Number of visitors

📈 How to increase this:

• Test different headlines, value propositions and CTAs

🔸  Example:

You had 1,000 visits to your site last month.

You got 50 people to sign up for your newsletter.

Your sign-up conversion rate is 5%

2) Activation Rate

The percentage of new users who do a core action in your product.

Activation Rate = Number of new users who became active / Number of new users

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📈 How to increase this:

• Get new users to the product value fast
• Have a strong welcome series

🔸 Example:

You are a fitness app.

A user becomes "active" when they do a training session.

Last month, 50 new users do a training session.

500 new users who signed up.

Your Activation Rate is = 10%

3) Active Users

The total number of users who were "active" in a given timeframe.

This includes new and existing users.

Usually, this is:
• Daily Active Users (DAUs)
• Monthly Active Users (MAUs)

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📈 How to increase this:

• Add sticky features
• Send re-engagement emails

🔸 Example:

You have 10,000 users in your fitness app.

1,000 did a training session in the last 30 days.

You have 1,000 monthly active users.

4)  Churn

The number of customers who stop using your product.

Churn = Number of customers who stopped using the product  / Number of customers at the start of the period.

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📉 How to reduce this:

• Improve your onboarding flow
• Offer annual pricing

🔸 Example:

You have 5 customers cancel this month for your SaaS

You started the month with 50 customers.

Your Churn is 10%

5) Average Revenue Per User (ARPU)

The amount of revenue per user.

ARPU = Amount of revenue / number of users you have

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📈 How to increase this:

• Offer upsells / cross-sells
• Create new products
• Sell bundles

🔸 Example:

You made $10,000 in total from your app.

You have 100 users.

Your Average Revenue Per User is $100

6) Customer Acquisition Cost (CAC)

Marketing and sales costs to acquire a customer.

CAC = Total marketing costs / number of new customers

Get this as low as possible.

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📉 How to reduce this:

• Make your marketing more effective
• Improve your conversion rates

🔸 Example:

You spend $20,000 on marketing next month.

You get 100 new customers.

Your CAC is $200.

7) Lifetime Value (LTV)

The total value a customer generates over the lifetime of using your product.

LTV = Average Monthly Revenue Per User x Average Customer Lifetime

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📈 How to increase this:

• Reduce churn
• Offer upsells + new products

🔸 Example: You sell a subscription service

Your SaaS costs $10 a month.

The average lifetime of a user is 12 months.

Your Lifetime Value is $120

In SaaS people often speak of the LTV: CAC ratio.

This shows the efficiency of marketing.

The next metric is better for this:

8) Payback Period

The time it takes to recoup the cost of acquisition from a new customer.

Payback Period = Customer Acquisition Cost / Product Cost * Profit Margins

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📉 How to reduce this:

• Offer annual or lifetime pricing

🔸 Example:

Let's say you spent $200 to get a customer.

Your product costs $50 / mo.

Your profit margins are 80%:

$200 / ($50 * 80%)

Your Payback Period is 5 months.

9) Recurring Revenue

This is the amount of revenue you get on a recurring basis from your customers.

This is calculated as:

• Monthly (MRR)
• Annually (ARR)

MRR = # of customers * average billed amount

ARR = MRR * 12

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📈 How to increase this:

• Upsells + cross sells

🔸 Example:

You have 20 customers.

They pay on average $50.

Your Monthly Recurring Revenue is $1,000.

Your Annual Recurring Revenue is $12,000.

I created a free Notion dashboard for you to track all of these key metrics.

You can get it here:

https://growthroadmaps.gumroad.com/l/dashboard

TL;DR 9 metrics every founder and marketer must know 📊:

1) Website Conversion Rate
2) Activation Rate
3) Active Users
4) Churn
5) Average Revenue Per User (ARPU)
6) Customer Acquisition Cost (CAC)
7) Lifetime Value (LTV)
8) Payback Period
9) Recurring Revenue

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