Startup Metrics: North Star Metric makes your business organized

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Startup Metrics: North Star Metric makes your business organized

Startup Metrics North Star Metric makes your business organized

You must have heard the term growth hacking. But have you ever heard the term North Star Metric? North Star Metric acts as a guide for businesses in managing strategies so that they can achieve their business goals.

In this article, we will discuss all North Star Metric; Starting from his definition to how to determine the right North Star Metric for your business. If you want to know more, let’s leave the article!

What is North Star Metric?

North Star Metric (NSM) is a crowded concept used in Silicon Valley to help startup growth. These metrics can help a team to focus on increasing customer retention for the long term.

So, North Star Metric is a metric that measures whether your product’s Core Value reaches the customer or not. Optimizing your efforts to increase Metric This is one key to encourage sustainable growth in all your customer base.

NORTH STAR METRIC Each company can vary. The following are some examples of NSM used by big startups in the world:

  • Airbnb: The duration of a customer booked accommodation
  • Facebook: The number of users is active every day
  • Quora: Number of questions answered
  • WhatsApp: Number of messages sent by user

By determining what North Star Metric is right for your company, you can focus more on optimizing the business of all your company members so that you have sustainable growth.

How can North Star Metric help your business?

Identifying the North Star Metric for your business can help you to understand your customers and products deeper. According to Buckley Barlow, a Growth Advisor and Investor, NSM is a factor that plays a role in Myspace’s failure and Facebook success.

MySpace uses the number of sign up as their NGM while Facebook focuses on the number of monthly active users as their NGM. The number of registrations they get does not show the growth of their business because this METRICS does not tell them whether the user is signed up using their platform.

The use of platforms is metric that tells them whether customers see the value of the products they offer. If someone stops using it, it means they don’t see the value of the product. By paying attention to monthly active users, Facebook can see how many people see value from their social media.

In addition, Facebook can also do its feed optimization so that people get more comfortable using Facebook. To identify the right NGM for your business, you need to understand your customers; Value what they get from your product and how they use the product until they can feel the value.

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With these two pieces of information, you can optimize your product so that you can provide more value for your customers so that they don’t stop using your product. If your customer continues to use your product, of course, you will increase income and growth.

How do you determine the North Star Metric?

As mentioned above, to identify the right North Star Metric for your business, you need to understand your customers. To do this, you can start by looking at how many active users you have and how many customer loyal ones use and engage with your product.

Understanding these two points can help you identify what metrics can help you do growth hacking. This method will be your NSM.

If you first use NSM, you don’t need to feel worried if you don’t immediately get the correct NSM. You might have to try some different metrics until you can find the right metrics for your business at that time.

Hila Qu, Former Product Manager for Growth at Growthhackers said that there are five points that you can use as a guide in choosing your North Star Metric:

  • Metric must be able to show that your users feel your product’s Core Value.
  • Metric must reflect engagement and level of user activity.
  • North Star Metric must be one thing that indicates that your business goes in the right direction.
  • Metrics must be easily understood and communicated to the entire team
  • Don’t be burdened with the feeling that you must have a perfect NSM. What you want to look for is the most reasonable metric for your business. You might have to try several times until someone found the most appropriate NSM.

North Star Metric more than one, may or not?

Although North Star Metric is usually only one metric, sometimes one metrics cannot be used for each department. Therefore, each department should have its own NGM which ultimately supports the company’s NGM. The right NGM is NSM that represents the final results of the shared efforts of each department, team, and employee in your company.

For example, you want to see how many people use your application every day, you also still have to see other metrics such as, new sign-ups, new customer activation, and engagement development, and user retentions.

By understanding this interconnected metric as well as your current business conversion rate, you will get deeper Insight to optimize your products and services. After you identify your NGM, try to understand what actions must be done by each company member to move in the right direction.

Each department must identify its own NGM to focus and identify additional supporting metrics. Doing this will help everyone in the company identify which metrics they have to follow at the individual level.

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Even though you have identified and worked to reach your NSM, you still have to track and increase another metric. But this helps you to achieve growth by helping everyone in your company focus on the right activities and also make the right decisions.

Will the North Star Metric change?

One that you have to remember is that your North Star Metrics might change according to your company’s development and industry. Facebook is a great example of this. At the beginning of Facebook, their NGM is a monthly active user. With the growing development of Facebook and the social media industry, Facebook realizes that they also have to change their metric.

Their new NSM is a daily active user. With the growing development of the social media industry and Snapchat, Competitor has started tracking active user per hour, Facebook might change their NGM into an active per hour user in the future.

So, based on the development of your company and industry, you must be prepared to change the North Star METRICS of your company to be able to meet the demands of the industry.


Your North Star Metric is an important part of aligning your team to encourage rapid and sustainable growth. If you try to see the growth process, you will be able to see that growth is not only the responsibility of the sales and marketing team.

Every department, team, and individual in an organization plays several roles in providing value to customers. Sales and marketing attract new customers into the Sales Funnel, but the Customer Support team has an important role in ensuring prospective customers and customers can feel the Core Value of a product.

Coordinating every team in your company to work together in growth initiatives can be very challenging without metrics that concentrate them on a common goal.

This is where North Star Metric plays an important role. The North Star Metric you choose will focus on each individual, team, and company department so that by working together, all can reach the North Star Metric that you have specified.

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