Startup Growth Kpis
6 min readSep 6, 2020


The name, north star metric, is used by many companies like Amplitude, Mixpanel, Lean Analytics to name a few. The concept is simple: pick a North Star metric that’s most predictive of a company’s long-term success. I want you to think about it as your company’s leading indicator of revenue, creating customer value and measurable/actionable.

Why is a North Star metric important?

Let’s look at how other people have implemented it first for their own customer analytics platforms.


“Teams use North Star metrics to get everyone in a company focused on one goal. Ninety percent of the world’s data has been created in just the past few years and the profusion of analytical possibilities allow every department, every team, and even every contributor to chase their own metrics. If each team defines goals differently, they can work against each other and duplicate effort. When startup investor Sean Ellis coined the term “North Star metric,” he intended it to reduce administration, simplify meetings, and align teams around the singular goal of growth. The term North Star metric — drawn from the common name for Polaris, the star that lies directly above the Earth’s Northern pole — is mostly rhetorical. Companies with complex business models can have multiple North Stars, and any given North Star metric is composed of sub-metrics anyway. Any company that literally foreswore all metrics in favor of just one, such as recurring revenue, would almost certainly fail. The North Star metric is, simply, an exercise in simplifying the overall company strategy into terms all can remember, understand, and apply. North Star metrics are not to be confused with the acronym OMTM, or one metric that matters, a term popularized by the authors of Lean Analytics. There’s a subtle yet meaningful difference. OMTM is intended to mean “one metric that matters right now” and is a leadership tactic for fixing a short-term problem, whereas a North Star metric is intended as a long-term guide. Though, just like the real North Star, it too is impermanent. When the Egyptians built the pyramids, the Earth had a different North Star — Thuban — but it’s crept out of alignment, just as Polaris will in time. Companies should feel equally free to reevaluate their North Star metrics to make sure they still point the right direction, and amend them when they prove flawed.” (


“A north star metric is the key measure of success for the product team in a company. It defines the relationship between the customer problems that the product team is trying to solve and the revenue that the business aims to generate by doing so.

This serves three critical purposes in any company:

It gives your organization clarity and alignment on what the product team needs to be optimizing for and what can be traded off.

It communicates the product organizations’ impact and progress to the rest of the company — resulting in more support and acceleration of strategic product initiatives.

Most importantly, it holds the product accountable to an outcome.

In most companies, product teams are measured by how much they ship, not on the impact they have on the business. Without an impact driven culture in product, you can’t influence the destiny of your business. Without a north star, you can’t have a product-led company.” (

Examples of North Star metrics (suggestions from Mixpanel)


  • Number of weekly customers completing their first order
  • Value of daily purchases
  • Lifetime value

Consumer tech

  • Number of daily active users (DAU)
  • Number of messages sent per day (habit metric)
  • Retention

B2B SaaS

  • Number of trial accounts with over 3 users in their first week
  • Percentage retention


  • Signups and retention
  • Number of daily active visitors
  • Total read time
  • Total watch time


  • Total assets under management
  • Number of daily active users

Deciding What’s Right for You

To find their North Star metric, companies must decide what is truly essential to the business. Companies are complex and succeed and fail for lots of reasons. But what are the pillars to the business that are, as an architect might say, load-bearing? That if they alone failed, would ruin the company? For many teams, that’s making customers happy, generating profit, and measuring progress toward those goals. A metric that simply makes money without satisfying customers will fail in the long run, as will a company that satisfies customers without being profitable. And a metric that doesn’t measure progress in a way that allows teams to act on its insights and change their behaviors isn’t useful. A North Star metric must reflect all three factors, tailored to each business. To find your North Star metric:

  1. Ask, what is essential to the business’ functioning? Prioritize a list.
  2. Ask, what KPIs and metrics measure the top few, key factors?
  3. Ask, what metric encapsulates all of the above?
  4. Build a metric hierarchy, with the North Star metric on top of the pyramid

Like a seed, North Star metrics need fertile ground to grow. Companies that select a North Star need the right culture and infrastructure. Without cross-silo relationships and a willingness to prioritize the company good above the team good, some employees may reject the North Star metric, especially if they must change their behavior significantly, or if, like many sales teams, their compensation structure presents a conflict of interest. Companies also need the right analytics tools to measure progress toward their North Star metric and sub-metrics. Without user-friendly analytics that teams can access at a whim, companies can’t tell whether they’re succeeding, and can’t course correct. Most teams find user analytics vital to measuring their North Star metric. User analytics provide user-level insights that most analytics platforms — especially free ones — don’t capture. User analytics:

North Star metrics can be an effective strategy for aligning all teams around a singular goal, provided they’re not taken too literally, are supported by a flexible culture, and measured with analytics tools that helps teams tell whether it’s still guiding the way.

For me working in the fintech space, my north star metric was a habit metric. Lot of companies have them. They are usually retention metrics. For Pinterest, they are trying to drive weekly repins to drive usage. This retention metric leads to the habit metric of 4 days pinning out of the first 28 days. I picked my fintech north star to be a similar time frame since users must wait for their card to arrive. For me 28 days worked best and allowed me to define my key performance metric as 3 transactions in the first 28 days with the leading indicator metric as number of days to first funding. This way, if I can drive a user to fund their account quicker, I can unlock their ability to purchase and show the value of my fintech platform.

Example Diagrams

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North Star image courtesy of: