According to Dave McClure there is five key stages in any startup which are Acquisition, Activation, Retention, Referral, and finally Revenue. I am going to explain my understanding of his theories for those who are still blur.

Acquisition – This is the stage where you get people to come to your website, how you do it is up to you be it Google Adwords, Facebook ads, partnering with others, banner exchange, etc. What is crucial in this stage is not the form of advertising, but the landing pages people see once the come to your site via those methods. Why are landing pages so important? It is because they should explain everything about your website in 1 glance.

Activation – Once you have acquire now it is time to make sure they register for your website. One of the easiest methods is include a registration button on the landing pages, but what is also important is making sure that the registration process is super simplified. Don't ask for lots of details right now, you can even use stuff like Facebook login if you want too ( well of course you shouldn't depend on it 100% but have it as an option ). It is also important that people have have first impresions about the site, the first 10-30 seconds are crucial, you got to draw them in by then. Activation should also not be more than 2-3 pages and more than 3 clicks.

Retention – This is one of the most crucial steps in anything, and one of the things which many websites forget, they get the first 2 steps right but can't keep their members. So they keep on boasting how many signups they have but dont tell people how many active members are available. ( Monthly , Weekly, or Daily basis ).

http://techcrunch.com/2011/07/30/vanity-metrics/

Above you can read all about vanity metrics and why it is bad, once you understand that you will know it is important to have high user stickiness for your site. Having many registered users means nothing if the website is practically dead.

Referrals – This step can only be done once the first 3 is done. Why I say so is because you want your website to be good so when people tell other people about your website, they tell how awesome it is, and not how sucky it is.

Revenue – Finally once everything else is done, then only we figure out how this website is going to make money ? Be it by advertising or maybe even affiliation with other partners.

There you go, that is my understanding of the metrics that is important for any web-startup company.