Matthew Kelly argues that customer retention matters more than acquisition for real business success. A leaky bucket with high revenue but poor retention won't attract buyers. Raw retention rates mislead because they ignore margins: a dog-food brand retaining 50% monthly has thin profits, while a supplement brand retaining less might have 80% gross margins.
The other one's probably, well, probably just the biggest lesson, that acquisition's the easy part. Retention's actually all that matters though, past a certain scale. And that's literally the difference in brands that make it and get acquired and don't. Honestly, I think you could have a brand doing $100 million revenue profitable, if it's retention shit, it's never getting bought because it's a leaky bucket. What is good, what is good retention? It's so nuanced. I don't like retention in isolation because if you look at a dog food brand, you might say they've got 50% month-to-month retention, right? But then they've got shit margins, so it's not like for like. A better measure is LTV to CAC. Obviously retention is directionally important, but like a supplement brand is always going to be significantly worse than a pet food brand. But supplements have probably 80% gross margins compared to dog food at maybe 30%.
