## Key Metrics (how to Know You Have PMF) Do not scale AT ALL until you find PMF. Take as many high-quality shots (shot, pivot, shot, pivot) on goal as you can. All about pivoting - https://youtu.be/8pNxKX1SUGE ### How to Know when You've Achieved Product-market-fit: 1. **Return Usage (# of people returning day 1, 3, 7, 30) / active users** 2. [[NPS]] > 50 3. Paying customer renewal rates. 4. You no longer push customers to the solution; they are pulling you towards them, beating a path to your door. 5. Things feel less difficult than they did in the beginning. Don't pay as much attention to signups or conversion rates, which are more indicative of market fit and unrelated to product-market fit. Once you've found it, aggressively scale it to kill the competition and own the market; be #1: [[blitzscaling]]  "I don't like churn because—let's say you're growing really, really quickly—your denominators changing faster than your numerator. The numerator is based on last year's denominator, so it could be deceptive as to what your actual churn is. But your renewal rates are great because that's looking for the percentage of people who are eligible to renew and what percentage of those people actually renewed. That's cohort-based, so I like renewal rates a lot better." After PMF, monitor: - Monthly Recurring Revenue (MRR) or Annual Recurring Revenue (ARR) - ARR != Annual Revenue Run-Rate: multiplying one month's all-in revenue by 12 = Annual Run-Rate, not Annual Recurring Revenue. - ARR = customer: "I'm signed up for a 12 mo plan." - MRR does not include one-time or non-recurring revenue (fees) - Growth Rate: Measured weekly or monthly - Net Revenue Retention: % of recurring revenue retained from a prior period - CAC: Costs to acquire a new customer ## Beyond Product-market Fit: Product-market-channel-model Fit 33% of top 100 YC companies are SaaS (the largest group). [Building a Growth Framework Towards a $100 Million Product — Brian Balfour](https://brianbalfour.com/essays/hubspot-growth-framework-100m) [Business Model Guide : YC Startup Library | Y Combinator](https://www.ycombinator.com/library/Gh-business-model-guide) Great brands are built on a core consumer insight. Ideally the same one your product is built on. Use this early to inform comms and marketing. Increase your price until customers are complaining but still paying.