Resetting KPIs for the New Year
As a new year begins, it is the right time for founders and leadership teams to reevaluate which key performance indicators (KPIs) really matter. The metrics that guided your company last year may not be the ones that will drive success in the year ahead. Resetting KPIs ensures that your reporting reflects the company’s evolving strategy and gives stakeholders a clear picture of what progress looks like.
Why Resetting KPIs Matters
KPIs work best when they reflect the current stage of the business and its priorities. Early-stage companies may focus on product adoption or customer acquisition, while later-stage companies often emphasize retention, margins, and efficiency. Carrying old metrics forward without questioning their relevance can distract from what is most important now.
Investors also expect to see KPIs that align with the company’s maturity and market conditions. Resetting them annually shows discipline and helps avoid the trap of tracking numbers that no longer tell the right story. For example, a seed-stage founder who continues to highlight daily user sign-ups after raising a Series B may look misaligned if retention and margins are what investors are now most focused on.
Steps to Reset Your KPIs
1. Revisit Strategy
Start by clarifying your strategic priorities for the year. Are you focused on growth, efficiency, retention, or product expansion? The strategy should determine the metrics. A company shifting from growth at all costs to sustainable efficiency needs a new lens on success.
2. Evaluate Existing KPIs
Look at last year’s KPIs and ask whether they still align. For example, if you spent 2025 proving product-market fit, the focus may have been new customer logos. In 2026, retention and upsell metrics might better reflect the company’s needs.
3. Add Stage-Appropriate Metrics
Match KPIs to your maturity. Seed-stage businesses may care about user adoption and pipeline activity. Series B or C companies should track contribution margin, burn multiple, and net dollar retention. These metrics tell a more complete story about scalability and efficiency.
4. Balance Leading and Lagging Indicators
Track both forward-looking drivers (like pipeline coverage or product usage) and results (like revenue growth or gross margin). This balance ensures you can anticipate changes rather than only react. A pipeline shortfall today signals a revenue challenge tomorrow.
5. Align With Stakeholders
Discuss KPIs with your leadership team, board, and investors. Make sure everyone agrees that the chosen metrics reflect the company’s strategy and provide clarity on progress. A short list of well-understood metrics often drives more alignment than a long list no one tracks consistently.
Examples of Evolving KPIs
Early Stage: User sign-ups, product activation rate, sales pipeline created
Growth Stage: Customer acquisition cost (CAC), lifetime value (LTV), retention rate
Later Stage: Net dollar retention, gross margin, burn multiple, EBITDA trajectory
These shifts highlight that there is no universal set of KPIs. The right ones depend on your stage, priorities, and market conditions. What investors want to see from you at $1M ARR is not the same as at $30M ARR.
Final Thought
KPIs are not static. They should evolve as your company does. Resetting them at the start of each year ensures your leadership team is focused on the metrics that matter most right now, and your stakeholders are aligned on how progress is defined. Taking the time to revisit KPIs is not just a reporting exercise, it is a chance to sharpen strategy and improve decision making across the business.
If you are revisiting your KPIs and want support in designing a framework that reflects your stage and strategy, reach out. I would be glad to help you set up reporting that works for the year ahead.
