311. The one metric that tells you if you're really winning

You can hit your financial goal and destroy your business.

You can be surrounded by fans, but none of them become customers.

This is demoralising, and it happens when you're measuring the wrong thing.

In this episode, you'll learn one of the most important concepts in product management — the North Star metric — and how to apply it to your product, your venture and your career.

This is the concept that tells you not just whether you hit a number, but whether you're actually winning.

This episode is for you if:

• You're building a product and want to make sure you're focused on the right thing
• You have a big career goal and want a sharper way to track real progress
• You keep hitting targets but feel like you're not actually getting anywhere

Book a free consulting session with Sophia: https://calendly.com/sophia-matveeva/new-meeting-1

Timestamps:

• 0:00 – Why you may be measuring the wrong success metric
• 00:30 – Podcast intro: Tech for Non-Technical Founders
• 01:52 – Free consulting sessions 
• 03:20 – New course on product thinking and AI innovation
• 04:40 – What is a North Star metric?
• 06:36 – Revenue vs retention in a language learning app
• 10:25 – Why retention is the real growth metric
• 14:38 – How to apply North Star metrics to your career or venture
• 16:00 – How Sophia Matveeva grew Tech for Non-Techies
• 17:55 – External stages as a personal North Star metric
• 19:50 – Set better goals for the second half of 2026
• 20:47 – Free session reminder and episode close

Follow and Review:

We’d love for you to follow us if you haven’t yet. Click that purple '+' in the top right corner of your Apple Podcasts app. We’d love it even more if you could drop a review or 5-star rating over on Apple Podcasts. Simply select “Ratings and Reviews” and “Write a Review” then a quick line with your favorite part of the episode. It only takes a second and it helps spread the word about the podcast.

Listen to our podcast on:

• Apple

• Spotify

• YouTube

• Audible

• Pandora

Transcript: 

Sophia Matveeva (00:00.194)
We're now in the second half of 2026. If you set goals at the start of the year, this is the moment to ask an important question. Are you measuring the right thing? Because the success metric you're chasing, like revenue or money earned, might be giving you a completely false picture of whether you're actually winning. And it's better to figure that out now than at the end of the year. There's a concept from product management that actually fixes this, and this is what you will learn in today's episode. And once you understand it,

You will never set a goal the same way again. Welcome to Tech for Non-Techies. This is a podcast for business leaders and non-technical founders building the future in the age of AI. Whether you've been in business for a hundred plus years and you're looking to modernize, or whether you're building something new, this is the show for you. You'll learn how to come up with new ideas and make them come to life no matter the size of your organization.

I've taught tech and innovation at Oxford University, advise companies like Microsoft and written for the Harvard Business Review. You're going to hear the frameworks and the thinking that I've built and tested and taught at the highest level. And now it's your turn. Let's get started. Hello smart people. How are you today? It is the summer, but I'm certainly not slowing down. So first of all, I want to thank the other people who are not slowing down with me. So thank you, Clancy, and thank you, Joy.

For booking your sample consult sessions. And Joanna, let's reschedule. For those of you that I've already spoken to, thank you so much. It's been really nice to get to know you and hear about hear your update. Because you know me, you hear me regularly. And I really want to get to know you and to know what's going on for you and what challenges you're facing. So essentially I can create better, more relevant content for you.

And if you missed last week's episode where I talked about these consult sessions, here's a quick recap. Basically, I'm taking a new coaching course. And as part of that, I need to do lots of sample consulting sessions with people. So these sample consulting sessions, they are free. These are not sales calls. So it's literally a free consulting session with me where I get on a call with you and I help you solve a problem. And yes, at the end of the call, I will make you an offer to work with me only if I think I can genuinely help you.

Sophia Matveeva (02:22.778)
But it's also absolutely no problem if you choose not to take me up on that offer. The bulk of the session is focused on getting you what you need. So so far, people have used these calls to ask me questions on how to build a personal brand to help you with launching a new venture, or how to position yourself as leadership material so you get promoted. And how to stand out as a thought leader when there are so many people posting complete rubbish.

That they have created with AI. So if you have questions on the above, or if you have been listening to this show for a while and you want to get my opinion on product innovation on or on anything else you've heard on this show, just book a session. You literally have nothing to lose. But do it now because I don't know how long I'm going to be able to keep this up for. My aim is to do them over the summer this year, but let's see if it gets too much because I'm currently in talks about a couple of major projects. I expect that they won't kick off.

before September. But let's see. So basically just don't hesitate and book your session now because we don't know how long that'll be available for. And the link to book is in the show notes. Okay, now let's get on with today's session. So I'm currently talking to a very highly ranked university about creating a new course for them. It's one of the projects I'm discussing that will start in September. The draft course, the name of this course is

Product thinking and innovation in the age of AI. And that's where students are going to learn how to come up with new ideas, how to test them and how to actually get them to come to life and bring them to market. And I'm genuinely really excited about this because I love teaching this stuff and I love the results. And I love seeing the results that people get. And the people at this university, they're really excited about it too, because it's going be really practical. There'll be frameworks, there'll be case studies, there'll be theory, but the homework is not going to be essays or tests, it's going to be

The students are going be creating something and testing it in the real world and then coming back and sharing it in class and deciding whether to pivot or whether to persevere. And this is really different to the classical academic learning that this university already excels at. So this is why it's going to be a great addition. And so today I want to talk to you about one of the key concepts, one of the super, super important concepts that I'm going to be teaching them. So you can apply it to your venture, to your

Sophia Matveeva (04:40.251)
product and to your career. It's one of these universal things. You can also apply it to your personal life. So this concept is the North Star metric. You might have heard of it. If you've heard of it, you're going to get a very clear explanation of what it is. If never if you've never heard of it and you're interested in product innovation, you basically have to pay attention to this lesson. It's a foundational product management concept and it's a useful career and business concept too. And my dear Smarty Bance, if you're listening to this when it comes out, this is

Perfect timing because we've just entered the second half of 2026. And this is a really good opportunity to think about what you want to achieve this year. So I want you to get to the end of 2026, to get to December 2026. I know nobody wants to think about winter, but you know, just I want you to picture the end of 2026 and you're thinking, yeah, I really, really I crushed it. Like I'm so proud of what I did and who I became, and I'm really proud of my achievements.

And I really set myself up for success for 2027, 2028. That's what I want for me. That's what I want for you. And the North Star metric is gonna help you get there. So the North Star metric is a thing that you focus on at the cost of all others. It's kind of one ring to rule them all, so to speak. But and this is very important, it is not immediately obvious what the North Star metric is. And actually, if you go for the obvious metric.

you might be shooting yourself in the foot and we don't want that. So getting it wrong can cost you time, money, and a lot of effort. So here is an example. So this is why this lesson is so important. So I've got two examples for you. One for product development and one for career development. So here's example one in product development and it's based on a language learning app. So you know if you're using Duolingo, this is gonna be really clear for you. So let's say you have a lear let's say you have a language learning app that monetizes via subscription.

And the subscription is $9.99 per month. And let's say you want to set a goal for the rest of this year. And let's say your goal is to make $100,000 in revenue. And so how are you going to measure success? How are you going to know whether you're getting closer towards your goal? So obviously, you could just count the cash. Like that's the obvious thing to do. You could make tweaks to your product and to your marketing, and then you could see what brings in the most money. But what if it's actually not that simple?

Sophia Matveeva (07:06.312)
What if counting the cash is not the right way of measuring success, even if your goal is actually a financial goal, even if your goal is a hundred thousand dollars? So why might that be? Well, if you're building a company for the long term, you don't just want to hit one financial metric and be done with it, right? You don't just want to make that a hundred grand and then just be like, okay, that's it. You want that money to be the basis of more money that then leads you to a successful exit, right?

So you want to build something that lasts. So essentially you have to hold these two goals together, the cash now and the longevity. So you have to be clever about it. And then you see that $100,000 is just the output. That is the result of stuff you do. And in our language learning app example, the stuff you do is actually it actually fits into a neat equation. So here is the equation: revenue equals new subscribers times conversion rate times price.

times how long they stay that retention. By the way, there are transcripts on techfonotechies.co. So if you go to the blog, you can actually see transcripts for every single episode. So if you're writing this down or you know you're on the go and you really want to write this down, just go to the transcript and you will get it. Okay, so basically revenue equals new subscribers times conversion rate times price times retention, which is how long your customers stay. So if we optimize

For the revenue number, you can hit it in ways that actually wrecked your business in the long term. So for example, you could spend really heavily on ads to spike new signups. So revenue would go up, but if most of these people cancel just after the first month, then you've bought a spike and not a business. And this is actually something that investors pay attention to because you could essentially spike your numbers ahead of somebody looking at them. So this is why smart investors would want to really

Be aware of spikes. Okay, but that's a whole other thing. We're not talking about that today. Okay, you could also raise the price to $14.99. So your revenue could jump overnight. But then if lots of people stop renewing their subscriptions as a result, you're masking your actual long-term decay with price. Again, it's one of these jumps and you don't know what's gonna happen next. You could also run aggressive win back discounts. So you could basically go back to people who've cancelled and say, hey, you can have a subscription for $2.

Sophia Matveeva (09:32.733)
This is short-term cash, but it is long-term trust damage because you know when I've seen these, I just go to cancel my subscription and then I just wait until I get the $2 offer. I'm sure many of you have done the same thing. So all of these tactics could make you the 100k number go green while the actual health of your app gets worse. And that's the core problem with counting cash as your target because revenue.

is a lagging indicator. It tells you what has already happened and it can be gamed in the short term. So for the investors listening to this, if you want me to go more into essentially what to look out for, how these gaming things happen, tell me, get in touch with me, email me or message me on LinkedIn, and we'll do an episode on that. Okay, so in this example, retention is the metric that actually matters because

You'll you'll see in a minute. So this is why we call it the North Star metric. So this is the thing that we focus on at the cost of everything else. So let's go back to the formula. Revenue equals new subscribers times conversion rate times price times retention, which is how long they stay. So one of these four input subscribers, conversion rate, price, and retention, three of them are very expensive. So user acquisition basically means you are paying Mark Zuckerberg a lot of money.

So three of them are expensive and they are hard to move because getting new users costs money and it's get it gets harder every year. The conversion rate has a ceiling. Like you will never convert 100% of your audience, sadly. And price increases also have a ceiling before churn basically starts eating the game, right? Like you're not gonna have lots and lots of people paying like 200 bucks for a language learning app. So price is a ceiling. Retention is the thing that

compound and makes all the others more efficient because a retained subscriber is basically somebody who keeps on coming back and paying you $9.99 per month. So if they do that not once, but hopefully for years to come, then retention is really a multiplier on lifetime value. So it's not just one line in the equation. So essentially if you acquire one customer and they stay with you for two years, then you are doing really, really well. So your aim is to keep on

Sophia Matveeva (11:48.091)
Adding and improving the app and you know, I remember I was actually using Deolingo for French, but I just needed a refresher and my French is pretty good. And then I completed it and there was nowhere else for me to go because essentially my level is so advanced. And I remember thinking, I would have totally used this, but you know, now I want to have like conversations, I want to do complicated stuff and it just wasn't there. Anyway, so better attention lowers your effective cost of growth because you're not refilling a bucket that is constantly leaking at the bottom. So basically it means

If you already have users that are using your product and you're doing ads, you're running ads to add new people, your new people are joining the people who are already there and essentially you're growing your community. Well, that's what you want to do. You want to grow your community where you want to grow your user base. You don't want to just, you know, have new people arrive and then have a look around and leave. Like that would be terrible. So retained users are also your best acquisition channel because you know.

I'm sure you've had this, you know, when you like a new gym or you like you like this podcast. Wh whenever there's something that you really like and you keep on using, you refer your friends, you leave reviews, you build the habit that makes the product spread by word of mouth. Which actually I've I've been forgetting to ask you for reviews. So if you've been listening to the show, you've been enjoying the content, you've been finding it useful, can you please leave me a review? It will really make me happy.

I am obsessively watching the stars on Apple and on Spotify. And I actually do get notifications when your reviews come in. So they make me very happy. So please make me happy and leave a review. Okay. So we've just discussed the leaky bucket idea. If you pour more water, like marketing spent into a bucket with a hole at the bottom, which is poor retention, you will never fill it. So you just work harder for the same result, which is rubbish. So you now see that even though your aim is financial.

So you want to make $100,000. Your actual North Star metric is something else. For a different business or a different stage of the same language learning app, you might have a different North Star metric. But on a product team with this metric, everybody focuses on the specific thing at the cost of everything else. And yes, you want new new users, but that's not where the bulk of your attention or your money is going to. And at some point, you're going to be really happy with your attention metric. Like you could always tweak it, but you're going to be

Sophia Matveeva (14:11.615)
Pretty satisfied with it. So then you're going to move on to something else. Maybe you're going to put your best minds and your and your capital towards new user acquisition. And actually that's that's the right order, right? You fix your retention first, you have great lifetime custom customer value, and then you increase your marketing spend. Okay, so you do this deliberately and you don't skip from one goal to the other, because basically if you're skipping from one goal to the other,

You're not gonna accomplish big things because big things require showing up and they require you to basically have a pretty high level of consistency. So now let's apply this to your life. So let's say you want to leave your job to start a venture and your timeline is two years. So you might need to raise money in two years, but you will definitely you know, you might not. I'm not always a fan of raising money. That's another topic anyway. But you will definitely need

Customers. Like if you're gonna start a business, you're gonna have somebody who buys your stuff and you're also gonna going to need a team. So you'll definitely need people who make stuff for you, make stuff with you rather. So because you are currently working, you actually don't desperately need to bring cash in, although let's be honest, cash is always nice. So my question to you is okay, if you are going to start a new venture in two years and you're currently working and you're currently getting paid, what's your aim?

What is your north star metric? What should you be focusing on right now? So we want you to be as ready as possible to launch your thing in two years' time and have it be a success. So what do you need to do now to lay the groundwork? Aside from listening to this show. So the most important thing is having your target customers know that you exist, that you understand them and their problems, and that you can help them. So this sounds this sounds easy, right?

But actually it takes strategy, it takes deep thinking and regular action to make it work. So if this is you, listen to example two, which is based on how I started Tech for Non-Techies. So before I registered Tech for Non-Techies as a company, I wrote about my journey as a non-technical founder, building my first business, and I was writing about that in Forbes. So I had a column in Forbes, I wrote there for a couple of years. And some of these articles basically went viral. And as a result, podcasters and the business break

Sophia Matveeva (16:27.711)
press reached out and asked me to share my journey and give advice to other people who wanted to build tech ventures without learning to code. So basically I was doing lots and lots of talking and writing way before I made any money from the concepts you hear me teaching here. And so people would read my articles or hear me speak on a podcast, and then they would think I had useful stuff to say. And so they would follow me on LinkedIn. And then when I actually started doing master classes for non-technical founders,

I would literally create a page on Eventbrite and then I would put that page on LinkedIn and say, hey, there's a class on tech for non-technical founders. If you've got an idea for a tech venture, come along to this thing. And people would sign up. People would sign up, they would refer their friends, and that's how actually I ended up teaching at London Business School and then registering the company and the rest is history. So in the story, you might think, well, maybe the first goal was the number of LinkedIn followers or the number of email subscribers.

Maybe that's the thing that I should should have been tracking. Well, actually, these are secondary goals because kind of like our revenue example earlier, these are results as opposed to inputs. So outputs as opposed to inputs. And we want to track your input. So the number of subscribers, the number of email subscribers and LinkedIn followers only happened because of my articles and forbes, the talks I was giving, and the media interviews where I was talking about being a non-technical founder. So your North Star metric.

If you know, if this is kind of a if you want to build a venture in the next couple of years, you want to have people know that you exist and that you can solve their problems and that you understand them. So the thing for you to do is to get known by these people. So your North Star metric is going to be the number of external stages that you go on. And here you have to be smart and you have to be strict with yourself because these stages, my dear friend, they have to be relevant. Doing karaoke at your local bar is

does not count, sadly. You know, I'm saying this because actually I remember a former client, smug guy, he wanted to write a blog post about football. That's soccer to my American friends. And he wanted to post it on LinkedIn. And yes, I know the World Cup is happening. I have no idea what's going on there. Like totally, totally not my jam. Anyway, so he wanted to write this blog post about soccer and he wanted to post it on LinkedIn. But his goal was to get hired as a CTO in a tech startup.

Sophia Matveeva (18:54.584)
And his five article, it was not r at all relevant to his goal. So basically you have to be clear about what stages you want to be seen on and how you want to be perceived there. And so this is why it's really worth it to think through your North Star metric. So what is it? And also what do you have to do to move towards it? So how do you identify the right stages? So we already I kind of I give I've given you a broad thing, but how do I how do you identify the right stages?

How do you get on them in the first place? Once you get on them, what do you say? How do you want to be seen? So once you pick the North Star metric, what I'm saying to you here is like you have the metric, but then underneath all of that, there's much more. But it's so useful to understand exactly where you're going because then all of the other problems like how do I get there, how how am I seen? They're all solvable. But you need to know what you're solving for. So

As we're now in the second half of twenty twenty six, I'm inviting you to think about your big aim. So your big aim in your product, your big aim in your venture, your big aim in your career. So do you have a financial goal? Do you have the goal of starting a new initiative? Or are you planning to get a new job? Or do you want to get promoted? What is your goal? And then think through what is the North Star goal here? So what is the input that you need to have and that you need to measure

in order to get the output that you want. So once you know your North Star and you have a strategy to achieve it, that's basically what you're gonna do for the rest of twenty twenty six. So but seriously, don't jump into strategy and tactics before you know where you're going because I often see people, they kind of, you know, have an inkling where they want to go and then they just start rushing there. My aim is for you is like, yeah, well take the inkling but actually strategize.

And this is where a sample consult session is going to really, really help you because if you want some help figuring out what your North Star is or how to get there, then this this is essentially what we can work on together. So my offer for a free sample session is still open. So if you're listening to this when it comes out or in summer 2026, try the link in the show notes. If it's not working anymore, that means the sessions are not happening anymore. But even if you're hearing this in the future, who knows? Maybe I will open

Sophia Matveeva (21:16.833)
open it up again but although frankly I doubt it. Anyway, book your session in the link in the show notes and now have a wonderful day and I shall be back in your delightful ears next week. Ciao.