A talk I gave at the Customer and Business Development Class at Berkeley taught by Steve Blank and Eric Ries.

1. Metrics that Matter
Defining startup success and failure
Hiten Shah
Customer and Business Development Class at Berkeley • Mar 9, 2010

2. The Startup Pyramid
The Race to the Top
Growth
Transition to Growth
Product / Market Fit
Sean Ellis: Startup-Marketing.com

3. Product / Market Fit
• Low burn, focused on product, no VPs / sales people
• Customer Development (Steve Blank, Four Steps)
• Minimum Viable Product (Eric Ries, The Lean Startup)
• Pivots (Eric Ries, The Lean Startup)
“…the life of any startup can be divided into two parts –
before product/market fit and after product/market fit.”
Marc Andreesen, Founder of Netscape

4. Customer Development
• It’s all about learning and discovery
• Outlined by Steve Blank in Four Steps to the Epiphany

5. Minimum Viable Product
• Coined by Eric Ries as part of The Lean Startup
• Lean Startups are a series of MVP’s
• Each designed to answer a specific question (hypothesis)
“ The minimum viable product (MVP) is often an ad on
Google. Or a PowerPoint slide. Or a dialog box. Or a landing
page. You can often build it in a day or a week.”
Nivi, Venture Hacks

6. “ If Apple can launch a smartphone without Find or Cut-and-
Paste, what can you cut out of your product requirements?”
Lance Glasser, former CTO KLA-Tencor

7. “ The first version of Gmail was literally written in a day”
Paul Buchheit, Google / Friendfeed / Facebook

12. Pivot
“ The idea that successful startups change directions but stay
grounded in what they've learned.”
Eric Ries, The Lean Startup
• Segment pivot - existing product, different customers
• Customer problem pivot - same customers, different problem
• Feature pivot - pick a feature and reorient around it

15. Product / Market Fit Metrics
Created by Sean Ellis (12in6)
• 40%+ of users say they would be “very disappointed”
• Representative of a large enough target market
• Use Survey.io to get started
Sean Ellis: Startup-Marketing.com

16. Transition to Growth
“ Once you have achieved product/market fit, it’s time to
accelerate through the next steps of the pyramid and then
begin scaling your business.”
Sean Ellis, 12in6
• Positioning - optimize first user experience via messaging
• Economics - implement a business model
• Optimization - track and report on the right metrics

18. First Product Iteration
Target Customer: Social Application Developers

19. Pivot 1
Target Customer: Many customer types

20. Pivot 2
Target Customer: 1 specific customer type

21. “Metrics are people, too”
Eric Ries, The Lean Startup

24. Test Things for Yourself!

25. Thank You!
“Passionate about helping other entrepreneurs
and startup people.”
@hnshah
hshah@kissmetrics.com