Measuring progress at an early-stage deep tech startup in space or propulsion or material sciences is very different from measuring SaaS startups. The goals are the same: you want to measure technology/product progress; you want to measure customer engagement and “sales funnels” for your prospects; and you want to measure progress for the next round of funding.
Because every subsector is different, and your fund might cover several sub-sectors, it’s good to have some common terminology of metrics — not to compare them directly, but to make conversations and due diligence easier, and to identify specific traits in each subsector. That will help you calibrate expectations and identify outliers (good and bad).
- System Maturity Milestone Index (SMMI)
- Capital Efficiency per Technical Delta (CETD)
- Readiness-to-Contract Index (RCI)
- Signal-to-Narrative Ratio (SNR)
- Trajectory Fidelity Score (TFS)
1. System Maturity Milestone Index (SMMI)
SMMI integrates both technical readiness and subsystem interdependencies. Unlike standard TRL (Technology Readiness Level), this index accounts for:
- Completion of integration tests, not just component tests
- Maturity of supply chain or fabrication pipelines, especially for space-graded or ITAR-controlled parts
- Evidence of repeatable manufacturing processes, critical for propulsion (see Production, not Product, as Competitive Strength)
Example: โWeโve progressed from TRL 4 to TRL 6, validated hot-fire test in vacuum conditions, and passed ISO 14644-1 Class 7 cleanroom qualification for engine assembly.โ
2. Capital Efficiency per Technical Delta (CETD)
This measures the dollars spent per meaningful technical advancement (not per time period). It could surface which founder does more with less while pushing the frontier, or which sub-sector is more or less capital efficient, or which technical advancement is more costly than others. If your thesis has a baseline, you can also measure how well you understand that space or where you have a bias. Careful with merely anecdotal evidence, though (more at the end!).
Beyond measuring startups, it also internalizes capital stewardship for GPs: A key vector in my ethos is internalizing externalities, and I should ask myself if money invested is aligned with my fund’s profile or LP expectations I set.
3. Readiness-to-Contract Index (RCI)
For dual-use ventures with potential customers in defense (versus resilience and security), and especially in space and propulsion, being program-of-record ready is often more critical than GA product-market fit. The RCI for the US market includes:
- Pre-award audit readiness (e.g., DCAA compliance for cost structures)
- SBIR/STTR success rates
- DoD TRL mapping, and
- Capability briefings with end-user commands (e.g., Space Systems Command, AFRL).
I believe that Combatant Commands, for example (CCMDs), behave more like empowered customers. As a result, there is a need for decentralize and accelerate decision-making, prioritizing resources against capabilities that best meet their needs.
“They need new technology, but donโt have time to wait for empty promises, whether they come from Silicon Valley or traditional defense companies.” — General Dan Caine, Senate Armed Services Committee, April 2025
Each country has their own program-of-records, of course. For example:
- Germany: FCAS (Future Combat Air System), MGCS (Main Ground Combat System), Eurodrone (MALE RPAS), CH-47F Chinook Heavy Lift Helicopters, IRIS-T SLM Air Defense System, Puma IFV Modernization
- Poland: Abrams Tank Acquisition, FA-50 Light Combat Aircraft, F-35A Lightning II, K2 Black Panther Tanks & K9 Thunder Howitzers, Homar-A Rocket Artillery, WISลA Air Defense (PATRIOT Program), NAREW SHORAD
- Finland: HX Fighter Program: F-35A, K9 Thunder Self-Propelled Howitzers, Gabriel 5 Anti-Ship Missile, NASAMS Air Defense System, MLRS Modernization, Local Border Defense Enhancements
- …
I could imagine that the NATO Innovation Fund is tracking those for adoption readiness.
4. Signal-to-Narrative Ratio (SNR)
SNR can be a helpful qualitative metric that evaluates the ratio between objective technical achievements (filed patents, successful subscale tests, peer-reviewed publications) and subjective PR, pitch decks, or media coverage. There is lots of tooling available (e.g. Meltwater.com).
It is qualitative. And it depends what you’re targeting. A high SNR indicates a company grounded in execution, not theater. This can be approximated through a founder update audit or diligence interview rubric. On the other hand, you probably want to communicate continuous progress for the next investors, and that will create some noise. Lastly, if you operate at the frontier, you will need to excite the passion of investors, people, customers within the current understanding of a technology, product, or market. Your product might change that framing, but sometime you have to play the game by its rules to create trust before breaking the rules.
5. Trajectory Fidelity Score (TFS) or Diversion Effectiveness Score (DES)
TFS captures whether the startup is tracking against a credible trajectory of increasing technical, operational, and institutional trust. It could weight:
- Technical Delta Velocity (how fast real milestones accumulate),
- Government Engagement Depth,
- Team Quality Delta (new strategic hires), and
- Manufacturing Path Clarity (e.g., in-house vs. contract).
LLMs might be helpful here: You communicated a strategy and trajectory to your investors or even your customers (e.g. product updates, integration, customer service quality, …). Based on emails and docs you send around; and based on media coverage, are you doing what you said you would be doing? Are you perhaps doing the right things but not communicating clearly? Did the strategy change or did you have a unique insight that you didn’t communicate yet, or that was an implicit finding that you have not surfaced yet?
In defense and security, you could use it the other way around for anyone outside the green zone and measure your diversion effectiveness: Is market perception of what you’re working on radically different from what you are actually doing?
Dangers of Metrics, Normalizing, Averages
I hope you use metrics for relative tracking against goals you set, or against a trajectory that you believe is necessary for a successful outcome (however you define that). The goal of venture metrics could be conviction and thesis for a very specific sub-sector. The analogy in SaaS could be “We believe CRM SaaS platforms for mid-sized enterprises in the Western United States should have a sales efficiency of 0.72 or higher at a 20% monthly expansion rate of sales people.” (this is just an example, head over to kellblog for some awesome SaaS metrics!
Any metric will be affected by necessary trade-offs in startups operating under scarcity of talent, money, time, and customer access. You have to make a judgement what you think is important to improve at each stage of the startup’s journey.
If you have insights from a fund-of-funds program or through other conversations, you could (in theory) “normalize” each sector by it’s peers. I don’t like that approach:
- Being “above average” is meaningless in venture, where outliers count.
- You likely only have anecdotal information, perhaps also from vintages where the market behaved differently (think cloud computing startups in 2005 vs 2015)
- Your job is to find conviction and make judgements under radical uncertainty – not to be driven by metrics which could be replicated by any other VC. What’s your alpha then?
REMEMBER: Whatever you measure and optimize for will automatically have a negative effect on everything that you don’t measure (exception: it’s fully described, or “complete”, by your metrics .. which is rarely the case).