Little Glossary · Measurement and search

KPI

A KPI (key performance indicator) is a metric chosen to measure whether a company, team or project is moving towards a specific goal. Not every metric is a KPI: only the few that reflect what really matters.

Updated October 5, 2026

Metric vs KPI

Visits, followers or email opens are metrics. They become KPIs when they're tied to a goal and someone makes decisions with them. Numbers that grow but aren't connected to revenue or retention are often called vanity metrics.

Leading and lagging indicators

  • Lagging: show the result once it has happened. Revenue, new customers, churn.
  • Leading: anticipate the result and can be influenced in the short term. Demo requests, user activation, opportunities created.

A good dashboard combines both: lagging indicators tell you whether you'll hit the goal; leading ones tell you what to do this week.

Common KPIs for B2B tech companies

  • Business: MRR or ARR, net revenue retention, churn, customer acquisition cost (CAC) and the ratio between customer lifetime value and that cost (LTV:CAC).
  • Marketing: pipeline generated, cost per opportunity, MQL-to-SQL conversion.
  • Website: demo or sign-up conversion rate on key pages, organic traffic from commercial-intent searches.
  • Product: activation, weekly usage, time to first result.

How to choose them

  1. Start from the goal, not from the data you happen to have.
  2. Keep few per team: three to five is usually enough.
  3. Define each one with a formula, source and owner, so everyone calculates it the same way.
  4. Review them on a fixed schedule and change them when the goal changes.

Common mistakes

  • Measuring what's easy to measure instead of what matters.
  • Setting targets on a KPI the team can't influence.
  • Changing the definition mid-year and losing the comparison.

Related terms

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