Glossary / Traction


Traction in startups refers to the measurable progress and momentum that a startup has achieved in terms of customer acquisition, revenue generation, user engagement, or any other key performance indicators (KPIs) that are relevant to the business. Traction is important for startups because it demonstrates that the business model is working and that there is demand for the product or service being offered. It also helps attract investors, partners, and talent, as it shows that the startup has the potential for growth and success. There are several ways to measure traction, depending on the nature of the startup. Some common metrics include: 1. Customer acquisition: The number of new customers or users acquired over a specific period of time. 2. Revenue: The amount of money generated from sales or subscriptions. 3. User engagement: Metrics such as active users, time spent on the platform, or frequency of usage. 4. Conversion rates: The percentage of website visitors or leads that convert into paying customers. 5. Retention: The ability to retain customers over time, measured by metrics like churn rate or customer lifetime value. 6. Partnerships: The number and quality of partnerships or collaborations established with other companies or organizations. 7. Media coverage: The amount and quality of press coverage or mentions in the media. It's important for startups to focus on achieving traction early on, as it validates the business idea and helps attract resources and support. However, it's also important to note that traction is not a one-time achievement but an ongoing process. Startups need to continuously work on improving their traction and scaling their business to achieve long-term success.