From my research, I noticed that a lot of startups do not track their metrics. At first, I thought it was because some founders are not analytical. But one day, a startup told me the answer.
“I don’t have enough data to track! [It is not reflective of my business.]”- Montreal Startup
What is data?
Data is a collection of facts and quantities used for analysis (ie. tracking your customer interviews and meetings, revenues/expenses, industry metrics, how many customers signed up, how many customers are retained, etc..) Business intelligence (BI) is the process of analyzing data to make business decisions.
1. I don’t have enough data to input!
Quality over quantity. 2 early adopters who love your product is far better than 100 people who are only so-so about it. Those 2 that really felt the problem your startup is trying to solve should definitely be tracked.
To do: Investors want to see how much you have evolved over time. Tracking early shows improvement!
2. I am too busy to input my data
Time is Money! If you don’t start tracking from the beginning, you might end up running into dead ends without even knowing it!
To do: What’s next: Invest 1 min/day to track your data. You can explore my affordable startup success tracker VenturX.
3. I don’t want investors to see my metrics
Investors want to see that startups are using business tools to monitor their customers, finances, etc. You need to prove your startup is investible. There is nothing better than seeing a visual. Investors are keen on data-driven results and decisions, therefore making metric-tracking is a great startup habit.
Don’t worry if your progress at that stage looks bad since improvement is the most important part. If you only track when you are rising, it doesn’t look like you improved by very much.
4. The data is not reflective of my business
BI focuses on the business as a whole, not just one particular part. Some founders are technical; others are management-oriented. Most focus on the parts they’re comfortable with. It’s a big reason why some founders feel discomfort when seeing low metrics regarding some parts of their business.
To do: Do track all aspects of your business! The good news is that modern tools come with hints on how to improve!
The bottom line is why wouldn’t startups want to use every resource in their toolbox, including tracking their data, to make the next decision?