Using Informal Metrics

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The following collection of words is by Morgan from Gift Pinpoint (7.2), with great input from team Legal Fácil (5.1).

Many companies within Start-Up Chile are deeply metrics-driven. Lets choose what numbers (“key metrics,” the more pretentious call it) to obsess over — and then, lets go all out to obsess over these metrics.

This is, overall, a strong strategy. But there’s a problem: some things are just hard to measure. What to do?

Here’s one of my favorite uncountable metrics (if that’s not an oxymoron): how late is everyone working.

Look at it this way. Two companies. Everything else, from what you can see, seems to be equal: both seem to have strong products, strong markets, strong teams–everything else you could want. But one of them works from 8am to 10pm every day. The other works from 9am to 5pm every day. Which one would you bet on? I know which one I would.

But how do you know, or even just estimate, how many hours-per-day a team is or isn’t working?

This is one of the secret benefits of shared workspaces, such as Start-Up Chile’s CMI and Moneda. It’s very easy to see when people come in, when they leave. You wait until 8pm one day–and you just look around to see whose there and whose not there. Ceterus paribus, I’d support the company that’s still there, hacking away, at 8pm.

But it gets more interesting! Shared workspaces have another benefit: when you glance at people’s monitors, it quickly becomes self-evident who is or isn’t working. Obviously, a good 95+% of all the teams, when you see their monitor, have screens of code open, or Powerpoint presentations they are creating, or mock-ups they are making, or other similar focused programs. But you occasionally see — that 5% — the person whose Facebook or Youtube is open just a little bit too long. A company in which the founder spends a bit too much time chatting on Facebook and watching Youtube videos–well, that might be a company that someone would want to invest in. But not me!

All of this came clear to me the other night, when Team Gift Pinpoint was at Moneda until 8:30pm. Who else was there? Team Where In Fair and Team Legal Fácil. Seeing them made me realize: there’s something great about a bunch of people, staying until way past everyone else leaves, focusing on their goals–letting nothing get in the way. Now that’s the kind of company that is poised for growth.

But note the “ceterus paribus” that I casually threw out above, as the qualifier: “everything else being equal.” Here’s the kicker: in the real, ugly world, all else is NOT equal. Maybe this team works harder–but that team is 4x as productive during the hours they do work. Or this other team has some deep advantage that seems magical. This is exactly what makes these sorts of comparisons hard. The solution? Choose your own values–and stick to them. Even if this team is magical or that one productive, overwhelming hard work goes a long way towards compensating for all other weaknesses. At least, that’s the value I’ve chosen to prioritize, and each of us needs to determine our own value set.