Learn the basics of Dirty Pirate Metrics, a practical framework for tracking growth and success of open-source tools beyond SaaS vanity metrics.
The Pirate Metrics framework is commonly used to track the success of SaaS companies; however, I believe it's just as valuable for tech founders building open-source tools. At Literally, we've been helping founders navigate these waters, and we'd like to share our learnings with the wider community as well.
In this post, I’ll discuss an upgraded version of Pirate Metrics called Dirty Pirate Metrics that should come in handy for tech founders and open-source builders too, and not just SaaS startups.
Pirate Metrics break down user growth into five key stages: acquisition, activation, retention, revenue, and referral. Think of it as a funnel that shows you exactly where users are dropping off and where things are going well.
This framework was invented by Silicon Valley investor Dave McClure, specifically for product-led SaaS-focused companies. Namely, McClure noticed that startup companies were getting distracted by vanity metrics, such as impressions and likes on social media, which looked good on paper, but didn’t actually drive growth.
When it first appeared, this framework made a lot of sense for new and upcoming businesses who could not relate to the traditional marketing funnel.
I owe a big thank you to my former mentor Stefan Verkerk (WeTransfer founding shareholder, Angel investor), who built on McClure’s original framework and took it a step further. He noticed that it made sense to add more layers to it and break down certain stages. That way, it became easier to see which teams or individuals were responsible for each part of the funnel. His goal was to ensure that the health of a company could be measured more clearly, and that’s how Dirty Pirate Metrics came to be.
The main steps in his version include foundation and scaling, addressable market, attention, awareness, activation, AHA amazement, revenue, retention, referral, and team.
Sure, I know it sounds like a lot at first, but from a high-level perspective, it makes a lot more sense to add more layers to the funnel, than to merge different processes managed by completely different people.
And that’s how we evolved from AARRR to FAAAAARRRT. Yes, that’s the actual acronym. And that’s why Stefan named the framework Dirty Pirate Metrics.
Gen X humor. (That was a millennial joke.)
Before I dive into specifics, let me try to simplify these concepts, so you get the point of each step.
Think of a neighborhood bakery.
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Now let's apply this to open-source tools.
In a standard SaaS company, success is measured in MRR, cost per acquisition, and net revenue retention rate. However, open-source success looks different. You may not have paying customers yet, but you do have users, contributors, community engagement, and project adoption.
What I’ve done is adapt the Dirty Pirate Metrics system to fit tech founders who have open-sourced their product or are following the open-core philosophy. Monitoring growth and defining success is important, even in the earliest stages, because you need to identify what can move the needle for you and your startup.
Let's break down each stage for open-source tools.
The first thing you have to think about is your service and offering. This is where it all starts: what can your tool do, how well can it perform, whom does your tool serve, and how fast can you onboard new users and scale with them?
You have to assess your strengths and weaknesses before you realistically approach the market. Defining your target user segments is essential when crafting a meaningful GTM plan.
Most founders look at their tool through a visionary lens, but onboarding your first users requires a realistic look at your tool’s capacity, platform, and internal processes.
The specific metrics in this stage vary from one tool to another. Consider the languages you cover, speed of onboarding, and your tool’s ease of use. It might be great for greenfield projects but not work out for dev teams who are replacing infrastructure parts of a 20 year old enterprise app.
Foundation and scaling forces you to face the reality of your situation. Can you solve the problem for developers at all, and can you scale as their needs grow?
For the record, most people would call this total addressable market (TAM), but we chose the option that starts with an A, for the sake of the joke.
Addressable market helps you figure out if the tool is worth building in the fist place. For a startup that’s looking to grow, it’s important to define who your ideal users and buyers are. Plus, if the total global spend on developer tools in your space is only around $50M, it’s likely not worth the engineering and marketing effort.
Therefore, to even kickstart a project like building an open-source DevTool, you need to make sure that the market already exists. Also, keep in mind that growing your business takes more than just devs: you’ll need a whole team to handle the business operations side, and those people have bills to pay, as well.
Addressable market forces you to ask yourself: does it make sense to build a tool in a given space in the first place?
Attention is the first step in which you interact with potential users. Basically, it’s about making sure developers hear about your open-source tool.
This could be through GitHub Trending, mentions in other projects, blog posts, and social media, or good-old word of mouth in the developer community. If your tool is being discussed on Reddit, Hacker News, or developer forums, that’s a strong sign you’re capturing attention.
In this stage, the developer is passive. They’ve heard about your tool, but they haven’t taken any action yet.
Awareness happens when developers not only know your tool exists but also understand what problem it solves and what it offers.
At this stage, they could be browsing your website, reading documentation, looking at your project on GitHub, or trying to understand the problems your tool solves. If developers are spending time on your docs or asking questions about your tool's capabilities, that's awareness in action.
One way to impact this step is to write about the problems your tool tackles. You can explain how your tool solves them and how it automates the process. That way, you’ll position yourself as helpful and informative, while also reaching the right people at the right time. Good metrics to follow are the number of visits to the homepage or the docs that come from the people who have first landed on your blog.
At this point, the developer is still passive. They're just exploring and learning, but they haven't taken any action yet.
Activation is when developers finally take it a step further: they are trying to install the tool but are not successful users just yet. In terms of SaaS businesses, this is your trialing user. They’ve finally got started, but they are still not ready to pull out their credit card.
Think of acquisition as the stage where developers go from casual awareness to active interest. This can be reflected in various ways, like signing up for your website, downloading your SDK, creating their first project, joining your community, or making their first contribution.
If developers are downloading your tool and getting started with it, that's activation (even if they have only created a test project to take your tool for a spin and haven’t added it to their main project yet).
Now, the developer is finally taking action: they're actively trying to get started with your tool.
Think of this as the “Aha!” moment, or the point when the developer finally understands why they should be using your tool in their production app.
Every DevTool has that unique feature that sets it apart from others. Your job is to make sure your feature shines. It should be easy to discover, intuitive to use, and clearly valuable. The more “Aha!” moments people have, the higher the likelihood they’ll remain your users.
This is the first time the developer is getting excited about using your tool and seeing its true value.
Retention measures ongoing engagement and usage over time. These metrics reflect through regular usage, multiple projects, production deployments, or active participation in your community.
If developers who tried your tool 6 months ago are still actively using it and contributing to discussions, your retention is progressing. If more developers in one org are interacting, that’s not churn, that’s expansion: not only are people coming back, they are also infecting others.
In this case, the developer has become a regular user. They're not just trying your tool once, they're making it a part of their workflow.
For open-source tools, "revenue" often means sustainability rather than direct income.
This could be through active contributors, GitHub sponsors, corporate sponsorships, grant funding, or speaking opportunities. If companies are willing to pay and support you or if you're receiving grants to continue development, that's revenue in action.
This marks the point when your project transitions from something you’re working on in your free time to a sustainable venture fueled by ongoing support.
Referral is organic growth through word of mouth and your community.
Think of it as the process of getting your users to become advocates for your tool. This could be through GitHub forks, blog posts and tutorials written by users, conference talks mentioning your tool, or social media shares. If satisfied users are writing about how your tool has solved their problem and bringing new users in, you’re seeing referral at work.
Your users are no longer just using your tool. They have become your marketing team, and they're actively promoting it to others.
For open-source companies working on growing their contributor base, this step is very important. We’re not talking about users who have made a single contribution that has solved a problem they had but people who are excited about your community and who want to commit to pushing the tool further.
This also reflects in the number of people who may not be developers but still want to become a part of your company. The team members who choose to stick with you through the ups and downs also count.
In the end, the achievements of a certain tool are driven by the people behind it. While some of them may be working behind the scenes, every contribution is equally important and influences company goals and growth.
Don't try to track everything at once. Focus on the stages that matter most for your current growth phase.
Try to engage developer communities online and create fun content that will get them intrigued to start using your product. If you’re not sure how to pull that off, Literally is here to help.
This is the phase during which you should start considering retention metrics. You want to grow your user base and the community, and you want people to stay engaged.
Now we’re talking business. This is the right time to think about sustainability, profitability, and making sure that every developer using your product is talking to other devs who haven’t tested it yet.
Developers are notoriously famous for blocking ads, which also results in blocking analytics tools. That’s why you need to be able to combine more of them. The first (and the easiest) iteration can look like this:
I’ll follow up with an additional blog post, which will show you how to set up simple dashboards for your project by using PostHog, Val Town, and GitHub. I’ll also dive deep into specific metrics for each stage.
Dirty Pirate Metrics gives you a way to understand your open-source tool's growth without guessing.
There’s no need to obsess over tracking everything perfectly from day one. Start simple, focus on the metrics that matter most for your current stage, and build your measurement system as your project grows.
I’d like to thank the following people for participating in creation of this post:
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