North Star metric
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Definition
A North Star metric is the single metric that best reflects the value a user receives and, at the same time, predicts long-term growth. A good NSM rises when the product genuinely becomes more useful, not when it is pushed more aggressively. It ties team work to value rather than directly to revenue.
How to compute
An NSM is not derived by a formula from above; it is chosen. Pick a metric that sits between user value and money — for example, the number of key actions completed. Then build a metric tree: split the NSM into drivers, each owned by a specific team.
Pitfalls
A metric that is easy to move by hand falls under Goodhart’s law and loses its link to value. An NSM is not revenue and not DAU: those are consequences. Several North Stars mean no North Star. A metric without a driver tree does not tell anyone what to do and turns into a reporting figure.