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Panos Panay Headshot

5 Ways to Measure Startup Progress

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A company's first 18 months are by far the most critical of its existence. This is the period of time when concrete signs of progress send clear signals to founders and investors alike that the company is more than just another idea. Successful early steps also reinforce confidence in everyone involved in the startup, an often-ignored, intangible element of entrepreneurial success.

It's extremely easy for founders to get distracted by the countless demands on their time in the early days of a company. Product launches, business plan refinement, capital raising, team recruitment, marketing pushes, sales pitches and personal responsibilities all vie for the founder's time. This type of business can lead to a heady (and hectic) sense of false accomplishment. This is why setting and defining clear priorities that a founder adheres to (no matter what) is paramount for survival and success.

Team Recruitment
No one is able to do it alone. In the early days of my company I had very little capital so I had to recruit a team largely based on the promise and mission of the venture rather than fat salaries. Being able to recruit others to your cause, especially in critical areas of the business is an indicator that the venture is exciting to more than just you.

Product Milestones
Setting and hitting clear milestones for your product launch and subsequent early releases is not just important in attracting and retaining customers, but also in boosting early team confidence. Product launches make an idea go from intangible to tangible and convert a founder's monologue to a real dialogue with customers.

Customer Conversion & Retention
This is where rubber meets the road. If you talk with any founder, they still remember their first customer. These critical early adopters, and the rate of subsequent customer acquisition acceleration, are unambiguous signals that there is a willing and paying market for a startup's offering. Failure to convert and then retain customers will send any company into a death spiral.

Capital Growth
Whether its in the form of revenue growth or outside investment, cash is the oxygen for any company. Keeping a hawk eye on a startup's cash is without a doubt a founder's most important responsibility. Simply put: no cash, no company.

Expanding Market Awareness
I do not mean paying for PR here, but a signal to success is if there is a growing organic awareness within a company's market about its product/service, and an increase in the "inbound" activity the new venture attracts. This may mean unsolicited outreach from prospective new partners; positive chatter on social media by customers; invitations from conferences for a founder to participate; and positive coverage in relevant blogs or publications. These signals, which are slightly less "tangible" than the others I outlined above, inevitably contribute to a growing sense of positive momentum and confidence.