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In business, material traction refers to real, measurable progress that demonstrates a company’s growth and market validation. It’s the evidence that a business is gaining momentum and has potential for scalability. Investors look for material traction as proof that a startup has demand, product-market fit, and a viable business model.
Types of Material Traction
- Revenue & Sales Growth – Increasing monthly/annual revenue, repeat customers, or large contracts.
- User Growth – Rising number of active users, downloads, or subscriptions.
- Customer Engagement – High retention rates, engagement metrics, and customer lifetime value (LTV).
- Market Adoption – Partnerships, major clients, or industry recognition.
- Operational Milestones – Expansion into new markets, product launches, or hiring key talent.
- Investor Interest – Securing funding rounds, venture capital backing, or strategic investments.
Example
A SaaS startup that grows from $10K MRR (Monthly Recurring Revenue) to $100K MRR in 6 months has material traction because it proves demand, scalability, and strong market adoption.