Every company has a story to tell. What is yours?
For companies — large and small — each day is spent telling your story over and over again to all of your key stakeholders. Hiring, selling, raising capital…the storytelling doesn’t stop, it simply changes contexts.
As a company grows, more and more stakeholders — investors, employees, advisors, partners — enter the fray. Stakeholders who need to be inspired to see the same future that you do and who need to be informed in order to play their respective roles most effectively.
Just under two years ago, we launched our 1.0 product on Product Hunt and conducted one of the first AMAs on the site. In that initial AMA, our CEO Mike Preuss noted the following:
“Our goal is to make it as easy as possible to get key data to the right people. With the rise of transparency, early stage investment, syndicates, equity crowdfunding, and more we are very excited for the future.”
Today, Syndicates has continued to roll ahead, equity crowdfunding is becoming a bigger and bigger force and the call for transparency in the early stage community has become louder, especially in light of the Zitrual situation and amidst concerns of companies burning capital irresponsibly.
So how can companies today — specifically early stage startups — leverage all of the data being created within their organizations and distribute that data most effectively to everyone that matters?
1. Accept the Responsibility
As Marc Andreessen noted in a recent sitdown with Dan Primack, deploying capital on behalf of others comes with a responsibility and requires discipline on the part of founders and executives. Employing others to help build your vision carries the same weight.
When you accept the responsibility to begin empowering people in your company with the right information, it leads to better communication between teams, more introductions from investors to potential customers or employees and an overall culture of transparency that endows a feeling of ownership that stretches beyond what shows up on a cap table.
2. Understand Stakeholder Personas
When bringing a product to market, customer personas play a major role in things like pricing, messaging and feature set. When distributing key information about the performance of your business, stakeholder personas help inform which subset of metrics you present as well as when and how you present them.
Investors, according to High Alpha CFO Blake Koriath, are often interested in the highest level metrics, enough information to quickly understand general trends in the business and also understand where they can have the most impact. Overall Gross Margin, MRR Added and LTV are examples of metrics SaaS investors may be interested in seeing.
Executive team members fall next in line and need to understand how the success of their team is contributing to the overall direction of the business. Finally, team members are likely interested in the “atomic units” of those higher-level metrics. That is to say, how are their individual contributions bubbling up to impact the metrics that determine success for their teams?
3. Build a Data Distribution System
Data Distribution is a term that we recently coined here at Visible to define the systems and processes a company has for getting the right information to the right people at the right time.
Find the Right Framework for Your Company
The way that a company tracks and analyzes the key performance indicators around its product development and distribution as well as its customers and employees is key in determining whether its data distribution system will be effective and yield long term positive results. It doesn’t matter how often a management team communicates with team members, investors and any other stakeholders if the communication isn’t actionable and relevant to what drives the success of the business.
Blake Koriath, mentioned above, likes to start wide when working with companies, focusing first on business model and company stage, then digging into exactly who will be viewing specific metrics and when.
Hone in on Your Most Valuable Metric
To use a line from David Skok (the Godfather of SaaS metrics), “good metrics should be actionable, and drive successful behavior.”
To accomplish this, you first need to determine the end definition of “success” for your company. Since the mix of factors leading up to this point (Business Model + Stage + Audience), as well as the overall goals of every company, are different, there is no one size fits all approach to selecting your MVM.
At Visible, the metric most tied to our “success”, our MVM, is the number of companies we have actively using the platform on a monthly basis. The progress that we make on this metric helps us understand the performance of each one of our teams and can help us identify parts of the business bottlenecking our growth.
First of all, it gives us a good idea of how many people are coming in to the top of the funnel through different inbound and outbound channels then lets us know if our product is effective at “activating” those companies. Then, if a company is coming back to Visible each month to track and distribute their performance data, they are more likely to be inviting their investors, advisors and team members. As more companies in an investor’s portfolio begin sharing updates and metrics, the investor is more likely to become a paying customer. Similarly, team adoption within an organization grows as companies invite more employees.
In addition, since so many of the companies on Visible are what would be considered early or growth stage businesses, their continued expansion will bring new stakeholders into the fray, adding to the number of people who rely on us for the organization of their most crucial business data.
Steal the Right Set of Metrics for Your Company
While your MVM is intended to give you and your stakeholders a holistic look at your company it cannot exist in a vacuum. Each week, month and quarter, your MVM will trend differently and having a strong set of supporting metrics can tell you why, as well as how you can continue the trajectory or make the necessary adjustments to get back on track.
Every supporting metric in your business should:
If these three criteria are met, you ensure that you aren’t spending time tracking and disseminating superfluous information about your company, saving your stakeholders time in trying to cut through to what’s important and helping everyone in your organization focus their efforts properly.
