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Coffee shop chat with a VC changed my mind on revenue vs users
I was talking to a VC from OMERS Ventures last week at a spot on Queen West. He said most Canadian fintechs chase user numbers when they should chase revenue per user from day one. It hit different cause I've been bragging about our 50k signups but we only make 80 cents per user. Now I'm wondering if I should pivot our free tier or just kill it entirely. Anyone else feel like they got the metrics wrong early on?
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blair_martin3d ago
That VC is 100% right and it's painful how long it took me to realize the same thing. I was running a subscription box service and bragging about 15k subs, but our average revenue was like $2.50 per person after churn and discounts. Had to kill the whole free trial model and start charging upfront, it felt like starting over but our actual revenue went up within two months. Really wish someone had told me year one what that person told you in one coffee chat.
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the_thea4d ago
50k signups but we only make 80 cents per user" - that's actually 80 cents per user per month or lifetime?
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tara7933d ago
Honestly, got sidetracked by that 80 cents per user number. I've been in rooms where people hype up "engagement metrics" but can't actually say what each user pays. Reminds me of this SaaS founder I overheard at a coffee shop bragging about 200k downloads but then admitted they made like a buck per user over the whole lifespan. It's wild how we all get caught up in the big number and ignore the actual money part. Makes you wonder what other metrics we're all lying to ourselves about.
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