7 essential metrics to measure the success of your e-commerce startups

In the vibrant and competitive world of e-commerce, having a firm grasp on key metrics is vital for startups looking to demonstrate value to investors. These metrics provide a snapshot of your e-commerce company’s performance, customer behavior, and financial health. In this blog post, we’ll delve into 7 essential metrics that you should include in your investor reports:


Revenue is the lifeblood of any business. It represents the total sales generated over a specific period and is the starting point for analyzing financial performance. For investors, consistent revenue growth is often seen as a positive sign that the business is capturing market share and that its products or services are in demand.

Revenue = Sum of all sales (excluding returns and discounts) during a specific period.

Gross Profit Margin

Gross profit margin is a key indicator of how efficiently your business is operating. It tells you the percentage of revenue exceeding the cost of goods sold. A high gross profit margin indicates that your company is efficiently managing its production costs and pricing strategies.

Gross Profit Margin (%) = [(Revenue – Cost of Goods Sold) / Revenue] x 100

Customer Acquisition Cost (CAC)

CAC represents the average cost to acquire a new customer through marketing and sales efforts. This metric is essential as it helps assess the efficiency of marketing campaigns. A low CAC implies that the business is acquiring customers efficiently, while a high CAC may suggest that marketing strategies need refinement.

CAC = Total Cost of Sales and Marketing / Number of Customers Acquired

Lifetime Value (LTV)

LTV estimates the total revenue a customer will generate during their entire relationship with the company. A high LTV implies that customers find value in your products, leading to repeat purchases and potentially higher profitability.

LTV = (Average Revenue per User x Gross Margin) / Churn Rate


This ratio is an invaluable metric for understanding the relationship between the lifetime value of a customer and the cost of acquiring them. A ratio higher than 1 suggests that the company is acquiring customers profitably, while a ratio lower than 1 could indicate that customer acquisition is too costly compared to the revenue they bring.

LTV:CAC Ratio = Lifetime Value / Customer Acquisition Cost

Average Order Value (AOV)

AOV tracks the average amount spent by customers per transaction. By monitoring AOV, businesses can understand consumer spending habits and implement strategies to encourage higher spending, such as upselling or bundling products.

AOV = Total Revenue / Number of Orders

Cash Burn Rate

Especially important for startups, the cash burn rate indicates how quickly the company is spending its cash reserves. Investors pay close attention to this metric as it gives them an idea of the company’s runway, or how much time it has before it needs to either become profitable or raise additional funds.

Cash Burn Rate = (Cash Balance at the Beginning of the Period – Cash Balance at the End of the Period) / Number of Months (or Quarters) in the Period

What is the best way to report metrics to investors?

Want to make investor reporting hassle-free? Look no further than Rundit’s investor reporting tool. Our platform offers comprehensive investor reporting features, making the process of startup investor reporting a breeze: 

  • Our investor report template includes both metrics updates and written summaries. The metrics table displays your metrics in an easy-to-read format, while the written updates provide brief summaries of the information you want to share with your investors. You can even pull data from the metrics table and attach it to the written report.
draft investor report
  • With Rundit, sharing your report with investors is easy – simply send it via email. Investors can view your updates without logging into Rundit or even being a Rundit user. Plus, they can directly comment and react to your report, reducing the need for back-and-forth emails and minimizing misunderstandings.


Having a solid understanding of these key metrics will not only help e-commerce startups to monitor and improve their own performance but will also enable them to effectively communicate their value to investors. Remember that the most successful e-commerce companies are data-driven, and using these metrics as a foundation for decision-making can be a game-changer for growth and sustainability.

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