Startup Metrics for Pirates Explained

November 06, 2018
Charlotte Dougall
Charlotte Dougall

Founder of Blether, helping small businesses do big things online.

Although every startup is different, there will usually be some similarities when it comes to customers, with each customer journey following key stages. Back in 2007, the founder of 500 Startups Dave McClure coined the term “Pirate Metrics” as a handy reminder of the main stages of the customer lifecycle for the vast majority of startups. Named because of the AARRR acronym, these metrics help create the foundation to grow your startup and provide clear focus for the future. Each stage of the customer lifecycle will have different performance indicators, and your analytics should reflect this.


Put simply, this is how you reach new customers and generate business. Acquisition tends to be the main focus of marketing, and this stage looks at both inbound and outbound marketing channels for driving traffic to your website or product. Acquisition channels can include social media, traditional advertising, search engine optimisation and more - if it acts as a way someone can discover your business then it can be considered as an acquisition tool.

At this stage, you’ll be looking at basic metrics like your page views and bounce rate. Here, you can figure out what your baseline looks like and carry out testing to see the most efficient methods for marketing your product or service. This stage of the process is primarily focused on awareness before moving onto brand activation.


Once you have your potential customers on your website or landing page, it’s time to convert them! This point is where your relationship with your customer really starts, as they’re showing a clear interest in what your business has to offer. 

When measuring activation, there should be a clear point of contact that begins the engagement. This might be signing up for your newsletter, submitting a contact form or starting a product trial. Their actions indicate that they want to know more about who you are and what you do. 


It can cost up to eight times more to obtain a new customer than retain a current customer, so sustainable businesses typically require some element of customer loyalty. Loyalty will look different for every type of business, so it’s essential to take a look at your standard customer life cycle and figure out how you can measure repeat custom and interaction.

Repeat visits or sales are a good baseline for measuring retention, and these can act as an indicator of what areas of your business are performing well and adding value. 


Referrals can be another signpost for the strengths of your company. Do your customers enjoy your product enough to recommend it to their peers? It’s not the easiest metric to track, but with the correct analytics and programmes in place you can gain clear insight into how your customers view your business and where you can improve. 


Most businesses rely on sales to sustain and grow. Looking at your revenue based on the channels and customers will assist you in effectively distributing your marketing budget, allowing you to clearly understand where to focus when looking to grow your business. 

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