YC
Ilya Volodarsky - Analytics for Startups
@ Y Combinator
08/01/19
Takeaways
IV
Ilya Volodarsky
08/01/19
@ Y Combinator
I'm Ilya Volodarsky, co-founder of Segment, and I'm here to discuss how to set up analytics to build your MVP and measure your metrics.
IV
Ilya Volodarsky
08/01/19
@ Y Combinator
Analytics, including primary and secondary metrics, are crucial for driving the MVP and product-market fit process, helping you test and focus your team after achieving product-market fit.
IV
Ilya Volodarsky
08/01/19
@ Y Combinator
You should always start with the funnel when thinking about analytics, which is the sequential series of steps users go through to gain value and eventually pay you.
IV
Ilya Volodarsky
08/01/19
@ Y Combinator
Monetization metrics should reflect how much revenue you generate weekly, comparing it to previous weeks to gauge growth.
IV
Ilya Volodarsky
08/01/19
@ Y Combinator
To collect data, instrument your tracking by defining user events, such as signups and video plays, to understand user behavior and engagement.
IV
Ilya Volodarsky
08/01/19
@ Y Combinator
You can derive monetization as a North Star metric by tracking monthly recurring revenue for subscription businesses or transaction values for e-commerce.
IV
Ilya Volodarsky
08/01/19
@ Y Combinator
Using tools like Amplitude or Mixpanel can help visualize user signups and other metrics effectively, allowing you to track growth and engagement.
IV
Ilya Volodarsky
08/01/19
@ Y Combinator
For acquisition metrics, track signups per week and differentiate between organic users and those invited by others to understand growth better.
IV
Ilya Volodarsky
08/01/19
@ Y Combinator
Setting a metric and goal for your team allows for data-driven operations, where you can monitor progress daily and adjust strategies accordingly. A low retention rate, like 6.25% after four weeks, indicates poor product-market fit; aim for at least 20-30%.
IV
Ilya Volodarsky
08/01/19
@ Y Combinator
Retention should be analyzed by looking at cohorts of users over time, assessing how many continue to use your product after signing up.
IV
Ilya Volodarsky
08/01/19
@ Y Combinator
To understand why users aren't finding value in your product, engage with them directly and make necessary adjustments.
IV
Ilya Volodarsky
08/01/19
@ Y Combinator
Airbnb aims for users to stay at rental properties at least once a year, while Facebook wants users to engage with their newsfeed daily or monthly to avoid being considered churned.
IV
Ilya Volodarsky
08/01/19
@ Y Combinator
Products lacking product-market fit typically see user engagement decline to zero, while those with fit will stabilize at a certain retention rate, ideally between 20-30%.
IV
Ilya Volodarsky
08/01/19
@ Y Combinator
Use tools like Mixpanel and Amplitude for retention analysis; they provide valuable insights into user engagement and retention over time.
IV
Ilya Volodarsky
08/01/19
@ Y Combinator
Revenue is a crucial metric for subscription businesses; track it through events like subscription upgrades to set growth goals.
IV
Ilya Volodarsky
08/01/19
@ Y Combinator
Display your analytics dashboard on a TV in your office to foster a data-driven culture among your team, ensuring everyone is aligned with the metrics.
IV
Ilya Volodarsky
08/01/19
@ Y Combinator
Establish social accountability around your metrics by sharing business performance updates with friends, advisors, and investors to gain valuable feedback.
IV
Ilya Volodarsky
08/01/19
@ Y Combinator
During the MVP phase, maintain open communication with early users through channels like Slack to gather immediate feedback and insights.
IV
Ilya Volodarsky
08/01/19
@ Y Combinator
Implement a data warehouse to democratize access to data across your team, allowing non-technical co-founders to ask questions and understand metrics without relying solely on technical staff.
IV
Ilya Volodarsky
08/01/19
@ Y Combinator
Having a shared inbox for support helps multiple founders respond to customer inquiries, preventing any single founder from becoming overwhelmed.
IV
Ilya Volodarsky
08/01/19
@ Y Combinator
Most products are often unusable for the first three months after launch due to unforeseen customer interactions, making it crucial to improve product usability early on.
IV
Ilya Volodarsky
08/01/19
@ Y Combinator
Using tools like FullStory allows you to observe customer sessions on your website, helping identify usability issues that can be fixed to improve metrics.
IV
Ilya Volodarsky
08/01/19
@ Y Combinator
After launching a feature, I noticed users were frustrated by a confusing button, leading us to fix it, which immediately improved our metrics.
IV
Ilya Volodarsky
08/01/19
@ Y Combinator
I recommend sending a personalized email to new users about 43 minutes after they sign up, which has proven effective in establishing a connection and encouraging engagement.
IV
Ilya Volodarsky
08/01/19
@ Y Combinator
Using Customer.io allows you to automate behavioral emails to users after they sign up, enhancing communication and support.
IV
Ilya Volodarsky
08/01/19
@ Y Combinator
Once you're confident in your product-market fit, consider implementing a data warehouse like Google BigQuery to democratize data access and enable deeper analytics.
IV
Ilya Volodarsky
08/01/19
@ Y Combinator
Don't spend too much time trying to choose the perfect analytics tool; both Amplitude and Mixpanel will yield similar results at the early stage, so prioritize speed in decision-making.
IV
Ilya Volodarsky
08/01/19
@ Y Combinator
For MVP processes, I recommend using Google Analytics for user tracking, Amplitude for feature analytics, and FullStory for improving product usability.
IV
Ilya Volodarsky
08/01/19
@ Y Combinator
In the early days, we used Google Sheets as a CRM and relied on email for communication, avoiding expensive tools like Asana or Trello.
IV
Ilya Volodarsky
08/01/19
@ Y Combinator
Segment is now free for early-stage startups, providing access to essential tools to help accelerate product-market fit processes.
IV
Ilya Volodarsky
08/01/19
@ Y Combinator
The growth rate needed for meaningful growth varies by product type; enterprise B2B companies may need fewer customers than consumer goods companies, which require higher volumes.
IV
Ilya Volodarsky
08/01/19
@ Y Combinator
Retention periods depend on the type of business; for example, an Airbnb would expect users to return based on travel frequency, which can vary widely.