The only 5 startup metrics you need to track if you want €10K MRR

There are only 5 startup metrics you need to track if you want €10K MRR. Not 30. Not a dashboard full of charts. Five.

I missed one of them and it cost me €22K.

Let me show you the 5 metrics, and for each one - I will give you one pro tip you can do right now to improve it, so you can start growing your startup to €10K MRR.

As we go, I’ll build the formula for €10K MRR - live on screen - one piece at a time. And Free to paid conversion is the first piece.

This is the percentage of people who sign up and actually pay you.

Thing is, you can get 10,000 signups and still make nothing.
So, I’m not counting website visitors, and I’m not counting signups.
I’m only counting real people who pay you real money.

Most SaaS startups with a free plan convert around 3% to 5% of their signups to paid. If yours is lower, you’re probably making the same mistake a founder in my mastermind did for months.

He built a reporting tool and only about 2% of all the people who used his free plan upgraded to the paid plan. Let me show you the big mistake he made, and how you can fix it right now.

He had five onboarding screens before anybody could use his app.

• How did you hear about us?
• What are your goals?
• What kind of reports do you need?
• Blablabla

So, people signed up, saw those 5 screens, and then just left.
So, we sat down and asked, screen by screen - do we really need this?
In the end we cut all of them.

Free to paid conversion rate jumped to 5% in about 2 weeks.

And you can do this in your startup right now.
Just open a spreadsheet and at the top write down your "Wow moment". That’s the moment someone uses your product and thinks:
"This is exactly what I wanted".

And then below that, list every step between signup and that moment.
And for each one, ask - do I really need this one to get people there?

→ Yes, keep it
→ No, cut it

That's it.

That’s how you improve your free to paid conversion rate almost immediately - because people get exactly what they came for.

That’s piece one: More signups turning into paying customers.
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But getting people to pay is only half of it. The other half is how much they pay. That’s metric number two: ARPU.

It basically means how much each customer pays you per month.

Let’s say you make €5,000 a month and you have 100 paying customers. Your ARPU is €50. That’s piece two of the formula:
New paying customers times what each one pays you.

Now look at this:
To get to €10K MRR, you need 200 customers paying €50.
Or 50 customers paying €200.

Same outcome.
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But with the second one, you need four times fewer customers.
Which one sounds easier?

I mean most founders only think about getting more customers.
But the second way is way easier - make more money with each customer you already have.

Here’s a simple way to do it:
Open your dashboard and sort your customers by how much they use your product. Take your top 10. Now look at where they hit limits, or what they keep asking you for - more seats, more exports, a feature on their wish list, whatever.

And then build that into a new, higher plan and offer it to those 10 first.
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Look at what that does. Say you price that new plan at €200.
And just 10 of your 100 customers move up from the €50 plan. That’s €1,500 more per month, and you didn’t need a single new signup.

Your ARPU just went from €50 to €65.

So now you’re getting more people to pay, and each one pays more.
The next metric is the one I missed, and it cost me €22K.

That’s the percentage of your customers who cancel each month.
And that’s piece three of the formula: The customers you lose.

And here’s the part that scared me:
Say you lose 5% of your customers every month. That doesn’t sound like much, right? But in 1 year, almost half of your customers are gone.
If you run the numbers, it makes sense. It just doesn’t feel like it.

I once met a founder at a meetup and he told me the most important thing is to get new customers. He said "Don’t worry about churn".

Let me tell you - this guy is not in business anymore.
But I trusted him. And it cost me €22K. Because I did the single dumbest thing you can do with churn.

I just let people go.

Someone clicks cancel, they cancel, done.
No conversation, nothing. I never asked why.

And what’s even more important - I never gave them a second option instead of just cancelling. I just let €22K walk out the door.

When I finally saw the number, I felt so stupid.

So, here’s the most important tip to reduce your churn - that almost nobody talks about. When someone wants to cancel - offer a pause, not just a cancel.

Like, "Hey, not sure if you need our product right now? How about you pause your plan for now and just activate it again once you need it?".

Because here's the truth - a lot of people who click "cancel" don't actually want to leave forever. They just don’t need it right now. I mean, I bet you have cancelled your Netflix account before and then just signed up again when your favorite series came back.

If you give people only the option to cancel, you lose them completely.
But if you make it like a - pause, unpause kind of thing, you keep the door open. You keep the relationship. And a lot of them come back.

If you want help fixing your churn and keeping more people, that’s what my startup mastermind is for. You get personal coaching from me, and you can talk to other founders and see what worked for them.

You can join right here:

The fourth metric to grow your startup to €10K MRR is CAC to LTV.

CAC is what it costs you to get one paying customer.
LTV is how much that customer pays you in total, for as long as they stay.  

Now, this one isn’t a piece of the formula - but it shows you if everything is working. And you’re looking for a very specific ratio.

Let’s say you’re using ads and it costs you €50 to get one paying customer. And over time, that customer pays you €170 in total.
That’s a bit more than 3 to 1.

So, what does that mean?

3 to 1 is what you want. That’s healthy.
5 to 1 is super strong.
And 1 to 1 means you’re not making any money with your customers, and eventually you run out of cash.

A friend of mine - a good friend - learned this the hard way.
He spent €2K on ads and got 200 paying users. Those users brought him only about €800. That’s 0.4 to 1. For every euro he spent, he got back 40 cents. And he only noticed this after putting up this metric.

So, to fix this and get closer to that 3:1 ratio, do two things.

First, work out your ratio for each marketing channel, not just overall.
Take what you spent on a channel last month and divide it by the paying customers it brought you. That’s your CAC for that channel.

Say you spent €1,000 on ads and got 10 paying customers.
That’s €100 each, so with an LTV of €170 you’re at 1.7 to 1.
Now say your newsletter brought 10 customers and cost you €200.
That’s €20 each, so 8.5 to 1.

Same number of customers, but one channel is 5 times better.
So focus there.

And second, improve your LTV - with the tips from earlier:
The higher plan, or the pause button.

And once you’re at 3 to 1, the last metric tells you when you’ll hit €10K.

The last metric is MRR growth rate.
That’s how fast your MRR grows each month, in percent.

Say you were at €2,000 last month and you’re at €2,200 now.
That’s 10%.

This one is basically your scoreboard.
If the other four are right, this number goes up.
And it tells you when you’ll hit €10K.

At 10% a month, you get to €10K in about 16 months.
So put your own MRR in and see where you land.

Here’s what I’d do:
Write down your MRR every month, and look at the average growth of the last 3 months, because one big month can fool you.

And if that number is too slow for your €10K goal, don’t try to “grow faster” in general. Look at the four metrics we just went through, and fix the weakest one. Just one.

So that’s the formula for €10K MRR. My god is that complicated.
Good thing you don’t need to remember it. You only need to know the metrics. And improve them step by step.

Now, if you want help with all of that - check out my startup mastermind.

You will ger pesonal coaching from me plus you can talk to other founders to see what worked for them.

You can join right here: