Activation & onboarding review

To: Omar (Head of Product) From: PM, Onboarding Subject: Onboarding Review: Redefining Activation and Q4 Strategy

Executive Summary

Our current activation metric—completing the setup checklist (61%)—is a vanity metric. Analysis of August’s 4,000 sign-ups shows that users who complete the checklist retain at Day 60 at roughly the same rate as the overall average (30.4% vs. 28.0%). Worse, the checklist sits before our core value proposition, causing 39% of users to drop off before we even ask them to connect a bank.

We need to redefine activation around real product value, scrap the current Q4 checklist goal, and redesign onboarding to get users straight to their financial data.

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1. The Evidence: What Actually Drives Retention?

Activation should measure the moment a user experiences Tidepool’s core value ("see where your money goes") in a way that predicts long-term habit formation. Looking at Day 60 retention from August’s cohort (4,000 total sign-ups), the data is clear:

• All sign-ups: 28.0% D60 retention (1,120 / 4,000)
• Completed setup checklist (61% of users): 30.4% retention (742 / 2,438)
• Created a budget (31% of users): 33.3% retention (410 / 1,230)
• Opened the app 4+ days (55% of users): 39.9% retention (870 / 2,180)
• Connected a bank account (50% of users): 48.2% retention (964 / 2,000)
• Categorised 10+ transactions (34% of users): 64.6% retention (891 / 1,380)
• Connected a bank AND categorised 10+ transactions (27% of users): 78.0% retention (842 / 1,080)

Key Takeaways from the Data: 1. The setup checklist does not predict retention. Doing administrative chores (naming an account, picking a color theme) does not deliver financial clarity. Users who skip or abandon the checklist aren't failing to activate; they are likely just bored. 2. Core value is delivered through bank connection and transaction categorisation. When a user connects their bank and categorises 10+ transactions in week one, their Day 60 retention jumps to 78.0%. Notably, this 27% of users accounts for 75% of all retained users at Day 60 (842 of 1,120). 3. Crucial caveat on Bank vs. Manual: Notice that 1,380 users categorised 10+ transactions, but only 1,080 did so and connected a bank. For the 300 users who categorised 10+ transactions without connecting a bank (presumably via manual entry or CSV), D60 retention was only 16.3% (49 / 300). Categorising alone isn’t enough; automated bank syncing is essential.

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2. Redefining Activation & Next Quarter’s Goal

• New Activation Definition: "Connected a bank account AND categorised 10+ transactions within 7 days of sign-up."
• Verdict on Q4 Goal: We must cancel the goal of raising checklist completion from 61% to 75%. Even if we hit 75%, D60 retention wouldn't budge.
• New Q4 Goal: Increase true activation (Bank + 10 Categorised Transactions) from 27.0% to 38.0%. Because this cohort retains at 78% (though we should monitor for slight dilution as we push less-motivated users through the funnel), moving this needle is the highest-leverage way to lift overall D60 retention above 28%.

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3. Assessment of the Design Team's Proposal

The design team proposed adding a progress bar and a celebration screen to the setup checklist. We should not build this for the current checklist.

Optimising a step that adds friction without adding value is wasted effort. However, we should repurpose the design team’s UI patterns for the Categorisation step. A progress bar ("4 of 10 transactions categorised to unlock your spending breakdown") and a celebration screen that immediately reveals their visualised spending insights will directly drive our new activation metric.

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4. What to Change in Onboarding

Right now, our funnel is backwards: we ask for customization before showing value. We should restructure the flow as follows:

1. Kill the upfront setup checklist: Remove "name your account" and "pick a theme" from onboarding entirely (default these and move them to Settings). Delay "set a savings goal" and "enable notifications" until after the user has seen their spending data, when those prompts actually have context.
2. Make "Connect a Bank" Step 1: Immediately after sign-up, prompt bank connection. Currently, we lose 50% of users here (many because they dropped off at the checklist first). Moving this to Step 1—and adding trust signals around security and read-only access—will immediately increase the top of our true value funnel.
3. Guided "First 10" Categorisation Flow: Once the bank syncs, drop users into a focused, swipe/tap experience (using Design's progress bar) to categorise their 10 most recent transactions, culminating in an immediate "Aha!" dashboard showing where their money went this month.

To: Omar, Head of Product From: PM, Onboarding Subject: Onboarding Review & Activation Strategy

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Executive Summary

Our current activation rate (61%) is flat because we are measuring and optimizing the wrong milestone. Completing our setup checklist barely moves the needle on long-term retention.

To drive retention, we must redefine activation around core product value—connecting a bank and categorising transactions—and reorient our onboarding funnel and quarterly goals to support it.

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1. What Activation Should Mean (and the Evidence)

Activation should represent the “Aha!” moment: the point where a user experiences Tidepool’s core value proposition and forms a lasting habit.

Currently, we define activation as completing the setup checklist (name account, pick theme, set savings goal, enable notifications). The data shows this is a vanity metric:

• Baseline Day 60 Retention: 28.0% (1,120 / 4,000 sign-ups)
• Checklist Completion: 30.4% Day 60 retention (742 / 2,438) — a negligible +2.4 percentage point lift over baseline.

By contrast, actions tied to our core utility (seeing where money goes) dramatically predict retention: * Connected a bank account: 48.2% Day 60 retention (964 / 2,000) * Categorised 10+ transactions: 64.6% Day 60 retention (891 / 1,380) * Connected bank AND categorised 10+ transactions: 78.0% Day 60 retention (842 / 1,080)

Users who complete both core actions retain at nearly triple the baseline rate. In fact, this group accounts for 75.2% of all retained users at Day 60 (842 of 1,120), despite representing only 27% of initial sign-ups.

New Activation Metric: > A user connects a bank account and categorises at least 10 transactions within their first 7 days.

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2. Design Proposal & Next Quarter’s Goal

#### The Design Proposal (Celebration Screen & Progress Bar) The design team’s proposal is solving the wrong problem. Adding progress bars and celebration screens to cosmetic tasks (picking themes, naming accounts) creates artificial friction before users experience any real value. We are gamifying administrative overhead instead of utility.

Recommendation: Repurpose the design team’s work, but attach it to the real value milestone (e.g., celebrating when their first 10 transactions are imported and categorized).

#### Next Quarter’s Goal (Raise Checklist Completion from 61% to 75%) We should retire this goal immediately.

Even if we hit 75% checklist completion, model projections indicate Day 60 retention would increase by less than 1%. Optimizing an arbitrary checklist delivers zero business impact.

Proposed New Goal for Next Quarter: > Increase the core Activation Rate (Bank Connected + 10 Categorised Transactions) from 27% to 40% of sign-ups.

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3. What to Change in Onboarding

Our onboarding funnel currently bleeds users before they experience core value: 50% drop off before connecting a bank, and only 34% categorize 10 transactions. We must clear the runway to value:

1. Eliminate the Cosmetic Checklist from First-Run Flow * Move “pick a theme” and “name your account” to Settings/Profile. * Defer “enable notifications” and “set a savings goal” until after the user sees their financial data.

2. Lead with Bank Connection * Prompt bank linking immediately post-registration. * Pre-frame the security and the payoff clearly: “Connect your account to see your last 30 days of spending instantly.”

3. Accelerate Time-to-Value (TTV) on Categorisation * Upon successful bank connection, immediately import transactions and guide the user through a rapid, swipeable 10-transaction categorisation flow (or auto-categorise and prompt a one-tap review). * Conclude with an instant visual breakdown: “Here’s where your money went this month.” This is Tidepool’s true “Aha!” moment.

4. Contextual Budgeting * Only prompt users to create a budget after categorisation. Budgeting retention is low in week one (33.3%) because users cannot budget accurately without understanding their baseline spend.

Next Steps

1. Align leadership on the new Activation definition.
2. Re-scope the design sprint from checklist gamification to a streamlined "Connect & Review 10 Transactions" flow.
3. Update the team OKR dashboard for next quarter.

To: Omar | Re: Onboarding review

Recommendation

Activation should mean connecting a bank and categorising 10+ transactions in the first week. Our current definition, completing the setup checklist, barely predicts retention, so the 61% is flat for a reason: we're measuring the wrong thing. I'd fix the path to the real activation event, use the design team's ideas only on that path, and replace next quarter's goal.

Evidence (4,000 August sign-ups, day-60 retention)

Three things stand out:

• The checklist is a weak signal. Checklist completers retain at 30%, against 28% for everyone. The checklist is theme, notifications, account name and goal, so it's mostly cosmetic setup.
• The combination matters, not either step alone. Backing out the overlaps from the CSV:
• Bank only (no categorising): about 920 users, 13% retained.
• Categorised only (no bank): about 300 users, 16% retained.
• Neither: about 1,700 users, 6% retained.
• Both: 78% retained.

Users who connect but never see their spending sorted do worse than average. The value moment is seeing where the money goes, which needs both steps. - Budgets and app opens aren't the answer. Budget creators retain at 33%, close to baseline. Opening the app 4+ days (40%) is engagement, not a lever we can pull in onboarding.

Caveat: this is observational. Motivated users probably do everything, so these numbers show who retains, not what causes it. The recommendations below are therefore tests, not guarantees.

What to change

The funnel is 100% → 50% connect → 27% connect and categorise. There are two leaks:

1. Half of users never connect a bank, and they retain at 8%. Put bank connection first, straight after sign-up. Move theme, notifications and account name out of the critical path (defer or drop them). Look at where the connect flow fails and whether trust copy (read-only access, security) is needed. I can't tell from this data whether the checklist is causing bank drop-off, so I'd A/B test bank-first against the current order.
2. 46% of those who connect (920 of 2,000) never reach 10 categorised transactions. This is the biggest fixable gap, since 78% of those who finish retain. Auto-categorise on connect, pre-fill best guesses, and walk users through their first 10 with one-tap confirmations rather than leaving them to find the feature.

I'd also instrument the funnel by step and by time, so we can see where in the first week people stall.

The design team's proposal

A celebration screen and a progress bar for the checklist would probably raise checklist completion, but that metric barely relates to retention, so we'd likely see a "win" with no change in retained users. I wouldn't ship them as proposed. Both ideas are cheap and sound, though, so I'd redirect them:

• Make the progress bar track the real path (connect bank → categorise 10).
• Put the celebration at the moment of value, such as the 10th categorised transaction, ideally with a first insight ("here's where your money went").

This is a good way to involve design in the work above rather than rejecting their proposal.

Next quarter's goal

Drop "checklist completion 61% → 75%". Pushing it up could even pull effort toward low-value steps.

Replace it with: percentage of sign-ups who connect a bank and categorise 10+ transactions within 7 days. Baseline is 27%. I'd propose a target around 35%, but that is a judgment call until we've sized the effect of the first experiments, so let's set it after a few weeks of data. Guardrail: day-60 retention among those users should hold near its current 78% (if we widen the funnel with less-motivated users, it may dip, and we should watch that). Track the real outcome, overall day-60 retention (28% today), alongside it.

Next steps

• Run the bank-first vs current-order A/B.
• Prototype auto-categorisation and a guided first-10 flow.
• Work with design on the redirected progress bar and celebration.
• Agree the new activation definition and dashboard before the quarter starts.

I'm happy to walk through the numbers if useful.