Tue, 18 January 2022
Challenges With North Star Metrics
Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.
The North Star Metric seeks to capture the essence of a business in just one metric.
It makes decision-making easier.
Anything that doesn’t foster that metric is deprioritized.
It does change over time as the company’s priorities change especially with growth.
It’s not always a simple metric and can be complex depending on the business.
You can however choose a simple one so it’s easier to communicate.
Here are some examples:
Spotify -- Time spent listening to music.
Quora -- Number of answers to questions.
Uber -- Rides per week.
Amazon -- Purchases per prime subscriber.
The North Star Metric can focus on time spent, transactions, productivity, or other.
Consider what drives your company’s growth and focus the North Star Metric on it.
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