KPIs (Key Performance Indicators)
The small set of measurable numbers a company tracks to judge whether it is making progress toward its most important goals.
Definition
Key performance indicators are the handful of metrics that matter most for a business at its current stage. A company can measure hundreds of things, but KPIs are the ones leadership reviews every week, reports to the board, and puts on the traction slide. Good KPIs are specific, measurable, tied to an outcome the business actually wants, and comparable over time so trends are visible.
Common Startup KPIs
Revenue
MRR or ARR, growth rate month over month, and average revenue per account
Customer Economics
Customer acquisition cost, lifetime value, and the LTV/CAC ratio
Engagement and Retention
Active users, activation rate, churn, and cohort retention curves
Financial Health
Burn rate, runway, and gross margin
Presenting KPIs to Investors
- Pick Few: Three to five KPIs tell a clearer story than a wall of numbers
- Match the Stage: Pre-seed decks lean on engagement, Series A decks lean on revenue and retention
- Show the Trend: A chart over time beats a single point-in-time figure
- Define Them: State exactly how each metric is calculated so it survives due diligence
- Be Consistent: Use the same definitions in the deck, the data room, and investor updates
- Lead with a North Star: Anchor the KPIs around the one metric that best captures customer value
Real-World Example
Airbnb: Nights booked as the anchor KPI
In its early years Airbnb tracked nights booked as the KPI that captured both supply and demand in one number. Supporting KPIs like listings, repeat bookings, and take rate explained the drivers behind it, giving investors a compact but complete picture of the marketplace's health.