Is this the right goal for seed-stage startups?

The final slide from an investor deck sent by a startup founder:

Financing

Raising: $1.5 million

Deliverable: MVP and 10,000 delighted beta users who would recommend the product.

Notes:
(1) Love the clarity: “Here’s how much we want to raise, and here, in one short sentence, is what we’ll deliver for that budget.”
(2) Note that the key deliverable is a product of demonstrated quality — an MVP with high net promotor score, validated by a sufficient number of users.
(3) Setting net promotor score as an explicit goal stops the company from trying to scale before the product is good enough. See The most fatal mistake to avoid as a startup.

7 thoughts on “Is this the right goal for seed-stage startups?

  1. Hey David – good post, as is so often the case. Thanks for writing. I clicked through to your presentation which I also liked. I was hoping you would specify a good NPS score for an early stage company, but you stopped short of that. Any thoughts?

    At Forward Partners we help founders build their company from day 1 and start measuring NPS from the get go. We have a rule of thumb that 40 is a good score after a small number of months, but there’s no science behind that. Some of our companies have done much better and a few have done a little worse.

    Keep up the good work!

    • Thanks for the kind comment, Nic. It would be interesting to hear from others what number they target for NPS. I’ve avoided specifying an objective number, because I suspect that it varies by industry, and a key issue is your NPS versus your competitors’.

  2. David,

    I am an OKR coach and I always recommend companies to use the OKR model to set clear goals for any key initiative or project.

    In this case it could be:

    Objective: Successfully raise and deploy seed round

    Key Results:
    – Raise $ 1.5 million.
    – Reach 10.000 beta users of the MVP.
    – Reach a NPS score of 40.

    • Felipe, I think you put your finger on something important. The slide I quoted from doesn’t quantify the goal that users should be “delighted”, and “recommend the product”.

      You turned that into an actionable, measurable goal, by explicitly stating a target score for NPS. I guess that’s what makes you a great OKR coach 🙂

  3. Pingback: The first goal for a startup isn’t growth | A Founder's Notebook

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