Ben Yoskovitz – Measure What Matters – MicroConf 2013

The MicroConf Hub Page with links to all the notes for all the talks can be found here. 

Speaker: Ben Yoskovitz (@byosko)

Watch the video (sorry, but I’m not allowed to embed it here)

What I have learned

  • It is easy to get zombified (you get used to your life and don’t improve anymore)
  • Recruitment sucks
  • Startup accelerators are fun (managing one that is)
  • I am not an analytics expert; but I wrote a book on analytics anyway

The basics of Lean Startup

  • Ideas (Everyone’s idea is the best – right?)
  • Build (People love this part – especially developers)
  • Product
  • Measure (This is where things fall apart)

What I hope you get from it

  • The importance of intellectual honesty (be honest to yourself about the success of your product)
  • Using your gut properly
  • Better decision making abilities
    • Everyone has data, the key is figuring out what pieces will improve your learning and decision making
  • Focus (Don’t chase shiny objects. Success without focus is just an accident)

Measure What Matters

  • What makes a good metric?
    • Measurement of movement towards your business goals
    • comparative
    • understandable
    • ratio or rate (absolute values often worthless)
    • changes your behaviour (If a metric doesn’t change your behaviour, it is a bad metric)

​​Types of Metrics

  • Qualitative (warm and fuzzy) vs. Quantitative (cold and hard)
    • Discover qualitatively
    • Prove quantitatively
    • AirBNB experiment: Professional photography will result in more bookings
      • Test by sending 20 photographers in the field
      • 2-3x number of bookings
      • now build that into your product
  • Exploratory (gets you new insights) vs. Reporting (neccessary to know)
  • Lagging (historical metric; churn) vs. Leading (prediction of the future; customer complains – which lead to churn)
  • Correlated vs. Causal (Ice Cream Consumption and Drownings are correlated – both caused by season!)
  • Don’t just follow the leader – monthly subscriptions don’t work for everyone!

Lean Analytics Stages

  • Empathy (I’ve found a real, poorly-met need)
  • Stickiness
  • Virality
  • Revenue
  • Scale
  • Skip steps at your own risk

How it All Comes Together

  • Choose only one metric and draw a line in the sand
  • Example: Paid Churn = Paid Cancellations over Paid Signups
  • Some interesting benchmarks
    • Growth (5% / week – revenue or active users)
    • Engaged visitors
    • Time on site (may be vanity, if user spends 20 minutes in help files)
    • page load time ( < 5 seconds – else you are loosing people)

 

Lean Analytics Cycle

  1. Pick the KPI (Key Performance Indicator)
  2. Draw a line in the sand
  3. Find a potential improvement
    1. Without data: make a good guess
    2. With data: Find a commonality
  4. Hypothesis
  5. Design a test OR make changes in production
  6. Measure the results
  7. Did we move the needle?
    1. Yes: Bring out the Champagne!
    2. No: Pivot or give up!
  8. Start over at 1.

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About Christoph

Christoph lives in Munich, Germany and is bootstrapping his own SaaS application as a part-time entrepreneur.

He likes to write on this blog about anything of relevance to single-founder bootstrapped software startups.

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