2023 W3: The Board and the KPI
Every week I post about one thing that happened at Rows. We're building in public!
Last week I came back from a NY trip, got a flu started, and had our quarterly Board meeting. One thing that came out of the board was a new key metric.
We've added it to our current 2 key metrics:
W3 Active Users;
*new* Power Workspaces.
There was a pandemic, which caused threw into disarray the worlds supply chain and logistics. There is a war in Ukraine, which re-organized a bunch of commercial ties e and has sent food and energy prices through the roof. There was also many years of economic growth fueled by unreasonable amounts of central bank money being injected in the economy.
Some or all of these sent inflation through roof, and when prices moved a lot, the economy just couldn't hold stable anymore. Investors become risk-averse. Corporations stopped hiring, slashed growth expectations, and reduced headcount too. This caution of the public markets has delayed many IPOs as well. The cost consciousness and reduced headcount means less spend on software licenses. That means private companies suffer directly and indirectly.
Some pundits are optimistic that 2023 will be a turnaround year, others not so much. Nobody knows.
We want to keep our big vision of building the next-gen spreadsheet, but have to deliver significant growth and clarity forward. January started quite well for Rows, but we are still far from where we want to be. Our job is to do more, faster, leaner!
TL;DR: Uncertainty is the kind of flu that can knock down capitalism and put it in bed for a while.
That is all to say that the Board this week was an important meeting to align expectations.
We split our meeting deck into 2 parts:
Current state: business, marketing, product, team, budget. Everything. The awesome, the good, the bad. What's known and what's uncertain.
The plan for 2023: What's coming beyond Q1 and the big decisions for 2023.
One of the points in the discussion was how to measure progress. How do know, at a board level, if the business is leveling up?
We want to keep our North Star of W3 Active Users. WAUs considers all active users, which are volatile and easy to game. W1s are users who are active 1 week or more after joining, so it's those who had an a-ha moment and came back for more. W3s are those who establish a habit, that is, who have come back 3 weeks after the first (they're on their 4th week). It's a stable metric, hard to game and a good mix between retention and engagement. The better the product is for building spreadsheets, the more success we are going to get, and that will be seen in W3s.
Viral sign-ups. We like it because it translates into how many of the signups are coming through "network effects": users inviting users, users sharing documents that convert users, and community spreadsheets. We also know these viral converts retain much better than signups who just find us on Google or stumble upon us online.
But we also get quite some who users who setup Workspaces and grow them inside clusters of their companies. These are quite important, because they predict those who more likely to upgrade to a paid plan. To focus on these teams, we added the metric of Power Workspaces. By "Power" we mean workspace with 3 days or more of activity in the week. If you have a team and people are using Rows 3 days or more in a week, well, we are pretty confident you're getting awesome value!
We were already tracking this metric, but it just wasn't one of our core KPIs.
So now we have 3 key metrics driving our Product and Growth Marketing. I added them to our Community template of an Investor Dashboard.
And now, we go out and make them grow!
See you next week!