Tag Archives: growth

20Growth Podcast Interview with Harry Stebbings

Harry Stebbings of 20VC fame is launching a new podcast series focused on growth. I was happy to be his first guest. We talk about growth inside startups, how to hire for growth, and many other topics. You can listen to the podcast here or on Spotify below.

Currently listening to Mana Pool by VAPERROR.

Why Product Leaders Fail

I’ve yet to meet a fellow Chief Product Officer or Head of Product say, “yeah, I’m crushing it right now.” In my conversations with fellow product leaders, there’s even a meme that’s started to form around product leadership roles. Effectively:

“Yeah, you just try to put some points on the board before you inevitably get fired.”

So, if a typical CPO feels their role is about trying to survive a couple of years i.e. long enough to help the business a little bit, what is causing that? Why is it so hard to endure as a product leader?

I would say there are three common failure modes depending on how far along the company is. The earlier stage of a company it is, the more likely the answer is going to be misalignment with the founder/CEO. What no one tells product leaders when they accept product leadership roles is that nine times out ten the founder and CEO still wants to drive the product vision. They want you to help execute that vision. And as founders scale, their founder intuition ebbs in effectiveness in comparison to product expertise in-house, but it takes a long time for founders to accept that. That transition period can be very rocky.

For later stage companies, the more likely answer is that the CPO is really only good at one type of product work, and the type of product work needed for the business changes over time. This can manifest in two ways: The product leader has skills that don’t match the type of job needed today, or as they execute, the skills needed change, and the leader cannot adapt. Not only is the product leader not good at that new job, they are also less likely to be interested in it.

Let’s talk about each of these failure modes and what both product leaders and CEOs can do to make them less likely to happen.

Failure Mode #1: Who Owns Product Vision?

Founders tend to have insanely good intuition about their customers and products because, let’s face it, no one has spent near as much time thinking about them and their problems. When startups tend to hire product leadership, it’s their first time hiring this type of leader. Interview processes can be clumsy or unoptimized, with the founder still figuring out how to articulate the real need. Commonly, what happens during this process is both the founder and prospective product leader end up jamming together on the future product vision. Both sides love this engagement, but for the founder, it’s not an effective test on how much the prospective product leader will help the founder, and for the product leader, it can give a false impression that they will have a ton of say in the product vision.

If at all possible, founders should leverage outside expertise to structure the recruiting and interview process for this type of role. One of the key questions to get explicit on before the process begins is what role will this leader play in setting the product vision? For non-product/eng/design founders, they may be asked to define it. For founders with product, eng, or design backgrounds, that is typically not the case until the company becomes much larger. Product executives usually play a consulting or execution role in a vision that is founder led. Founders need to tell candidates which one it is, and candidates need to ask. Neither of these happen as often as they should. 

Once founders understand their answer to this question, they need to vet for the appropriate skills. If what you really need is help executing on the vision, don’t spend much of the interview process jamming on the vision. Sure, candidates need to understand the vision, but what you really need to learn is are they comfortable receiving a vision from you and bringing it to life in the myriad ways that are difficult. 

Failure Mode #2: Does the Expertise Match the Type of Product Work Needed?

Different companies require very different approaches to their product strategy to be successful over time. Most of us understand there are different types of product work. There is tech and process scaling, there is building new products to find new product/market fit, there’s building new features and iterating on the user experience to strengthen current product/market fit, and there is growth work to get the maximum number of users to experience the product/market fit that exists. Traditionally, product leaders lean toward being experts in one or another. For example, I am definitely most known for my expertise in growth.

Founders often lack the understanding of what type of product challenge they are actually facing when they attempt to hire a product leader. Network effects businesses tend to focus more on growth because more users make the product stronger in a much more meaningful way than new features. DTC ecommerce companies / brands are always launching new products. SaaS businesses tend to need to launch lots of new features over time. Hiring a product leader that wants to build new features all the time into a network effects business likely isn’t going to work that well.

Failure Mode #3: Can the Product Leader Adapt as Needs Change?
Even if founders hire the leader with the right skills at the right time, as companies scale, how much weight they put on these will need to change over time. Today, the product leader’s job is to be what the business needs them to be. So while the old school product leader is a specialist, the new school product leader needs to be a chameleon, who can balance a portfolio across scaling, new product work, feature work, and growth weighted toward the needs of the business, and re-weight it considerably over time as business needs change rather than leave once business needs change. That’s hard, but inevitably how product leaders have to evolve to be successful over the long term within a company.

As a growth oriented leader, I am actually spending more of my time at Eventbrite on scaling, features, and new product expansion work, because that is what the business needs right now.

Product leadership is incredibly hard. Both founders and product leaders can eliminate some of what makes it so difficult by aligning on expectations before hiring roles, and on aligning which problems the organization is focused on right now. It is then up to product leaders to be able to evolve as the product needs change over time. They are both the best equipped to understand when needs change and help the organization change with them.

Currently listening to Rare, Forever by Leon Vynehall.

The Kindle and the Fire

Entrepreneurs ask me about how to grow all the time. They ask about SEO, about virality, and about increasing conversion, about onboarding. They ask about hiring local teams, building up new functions, and hiring executives. What almost all of them miss is that all of this is context specific on what stage of company they are in. There are two types of growth strategies: non-scalable strategies to get to scale and scalable strategies. I have come to call these kindle strategies and fire strategies. I’ll explain a little bit more about that, and how to think about them.

Kindle strategies can be very unsustainable. Their only goal is to get the company to a place where more sustainable strategies are available. The classic example is in marketplaces. Marketplaces only work when their cross side network effects kick in. Those network effects can only kick in once you get to liquidity. Once network effects do kick in, they can generally be optimized for very sustainable growth. When I left Grubhub, my former co-workers started complaining to me about how much Doordash, Uber Eats, and Postmates were spending on paid search and promotions. They were losing tons of money. There was no way any of those companies ever made this money back from consumer LTV. I told them that wasn’t their goal. Their goal was to get enough consumers so the cross-side network effect kicked in. Those companies were paying their drivers no matter what. Might as well spend money to make sure they’re actually delivering something. And these companies would be willing to almost spend an infinite amount to get the cross-side network effect going because of its value to the company.

I’ve never seen a company as aggressive with promotions as Postmates besides perhaps Homejoy.

This does not only exist in marketplaces however. Superhuman, for example, does live calls or meetings with most people who sign up. This will never scale if they have millions of users, but until either their LTV increases to make this strategy profitable, or they improve self-serve onboarding, they are doing it, because no one would retain without it. You’re willing to do anything it takes in kindle strategies no matter how silly it might seem long term. This is what Paul Graham is talking about when he says “do things that don’t scale.”

Airbnb sold politically themed cereal to raise money for the startup in the early days.

For kindle strategies, it’s more important they work quickly rather than sustainably or efficiently. A lot of early stage companies, for example, ask me about SEO. SEO, unless you have very clever hacks for content and authority, is a fire strategy. It takes too long to work. It might be a great fire strategy to sequence to, though. A lot of companies also ask me about local teams in each market they launch. This can be a great kindle strategy, but it’s generally a terrible fire strategy. Read more from me on this topic here.

Fire strategies by definition need to be sustainable. They need to be able to scale the company 100x and set up a long-term profitable business. So a question all entrepreneurs need to be asking when they pursue their kindle strategy is what fire strategy am I sequencing to. Pinterest used DIY meetups to sequence to influencer blog campaigns to sequence to virality to get enough content where it could scale via personalization on the retention side and SEO on the acquisition side. Most startups won’t go through that many sequences. I’ve seen many companies that have a successful kindle strategy, but it’s not sequencing them into any eventual fire strategy. For example, I spoke with an automotive startup that hacked SEO to get answer box results for their content to get initial users. That eventually caps on how many users it could drive, and it didn’t sequence them to something greater. They eventually shut down.

There aren’t that many fire strategies. Those that involve network effects are generally the best. Sales, paid acquisition, virality, and user generated content with a scalable distribution channel are the most common ways to create sustainable loops to either scale a network effect or scale a product that doesn’t have network effects. This is sobering when I tell entrepreneurs this. There just aren’t that many ways to scale, and almost all involve having extremely good retention as well. Otherwise, you won’t have the profit in the system to invest in sales or paid acquisition, or you won’t get enough users to invite or create content to attract more users.

There are many ways to sequence to a network effect or some other sustainable growth loops, but there are not that many ways to scalably grow without these loops. If you want to learn more about these strategies, it’s exactly what we cover in the Reforge Advanced Growth Strategy course.

Currently listening to Perception by Grant.

What Type of Company Are You and the Growth 2×2

At Reforge, we’ve written about how companies actually grow, and built an entire program around it. Most companies, when they talk about how they grow, will usually pick from one of the following terms:

  • Sales Driven e.g. Oracle, Workday
  • Marketing Driven e.g. Hubspot, Moz
  • Product Driven e.g. Atlassian, Github
  • Engineering Driven e.g. Google, Palantir
  • Product + Sales Driven e.g. Slack, Stripe
  • Marketing + Product Driven e.g Uber, Amazon
  • Sales + Marketing Driven e.g. Drift, Salesforce

Most people can’t reasonably answer why they are one of these types, but there are reasons. If people inside these companies have thought enough about it, they might understand the market to have attributes that force these styles:

  • Sales Driven: Custom value props and big customers
  • Marketing Driven: Need to make a “space” that doesn’t exist yet and convince people they need it
  • Product Driven: High viral quotients and/or word of mouth from product differentiation
  • Engineering Driven: Solving hard technical challenges creates markets
  • Product + Sales Driven: Large customer spread with bottoms up adoption
  • Marketing + Product Driven: Marketing fuels network effects
  • Sales + Marketing Driven: Custom value props and big customers and need to make a “space”

That was extremely simplistic, but hopefully you get the idea. The larger a company grows, the more likely singular definitions like this start to break down though. Companies launch multiple product lines that require different distribution models, and these product lines typically build on top of each other that gain from the intersection of them. In the Advanced Strategy course, we teach how to model these systems of loops that power such companies.

What growth teams sometimes miss is that optimization is not always the answer to a growth problem. It may require a new product or building a sales team. Modeling your loops to understand your constraints to pick tactics that alleviate those constraints takes some time to do well. A framework I’ve used for more quick and dirty decision making is using data companies usually have on hand: whether a tactic is reliable or not historically in driving growth i.e. you can predict the output from an investment or not, and how fast the payback period is.

For those who aren’t familiar, payback period is one of the most important metrics you can track for growth. It’s very simple. Given this investment today, how long will it take before I recoup that investment in profit from the customers it impacts. For example, a customer you acquire in Adwords for $10 might take you six months to make $10 in profit, subtracting all marginal costs. So our payback period would be six months.

Most executive teams can start to plot where in this 2×2 tactics seem to sit. For example, brand marketing at all but the most sophisticated marketing driven companies is something that has a slow payback and is not reliable. Similarly, innovative product development focused on entirely new products or value props usually sits in that category. For other tactics, where they sit in this 2×2 may vary. On Pinterest’s growth team, for a more specific example, efforts in product driven growth around UGC content distributed through SEO, conversion optimization, email marketing, and activation were very predictable and had quick payback periods, but viral growth was unreliable. At Uber, I imagine viral growth via incentivized referrals was very reliable, but SEO was not. Now, it’s important to remember that within reliability is a sense of scale that matters for the business. If a tactic gives you .1% growth, and only 10% improvements matter, it actually isn’t a reliable lever. An alternative is to make a three dimensional chart where reliability is separate from impact, and ain’t nobody got time for that.


A sample Growth 2×2 for just Pinterest’s growth team

In the long run, model your loops well and find the constraints. In the short term run, maximize efforts on reliable and quick payback activities until you hit diminishing returns. Then, think about moving excess resources into things that are reliable, but have longer payback periods. And think about how anything with short paybacks that are unreliable can become more reliable.

What you’ll quickly realize in the case where you have built a proper growth model or you’re short term optimizing based on this 2×2 above is the opportunities are rarely siloed to one function. You can’t even build this 2×2 if you don’t have many functions represented. So start talking to all the functions of your company to map the opportunities to grow better so that you can grow faster.

Currently listening to Simplicity is the Ultimate Sophistication by Matthieu Faubourg.

What Is Good Retention: An Exhaustive Benchmark Study with Lenny Rachitsky

At the end of 2019, I presented Eventbrite’s product plans to the board for 2020. These plans included a lot of the goals you likely have in your company: improvements in acquisition, activation, and retention. One of our board members asked: “I understand these goals for the year. But long term, how high could we push this retention number? What would great retention be for Eventbrite?”

I actually didn’t have a great answer. Soon after, I was chatting with Lenny Rachitsky, and we decided to embark on a holistic study across the industry to ask “what is great retention?” across business models, customer types, etc. Lenny surveyed a lot of the top practitioners in the industry across a variety of companies, and we’re happy to share the results here. You can see the raw data below, but I recommend reading Lenny’s analysis here. Done? Good.

Why is retention so damn important?
Why are Lenny and I spending so much time researching retention? Because it is the single most important factor in product success. Retention is not only the primary measure of product value and product/market fit for most businesses; it is also the biggest driver of monetization and acquisition as well.

We typically think of monetization as the lifetime value formula, which is how long a user is active along with revenue per active user. Retention has the most impact on how many users are active and lengthens the amount of time they are active. For acquisition, retention is the enabler of the best acquisition strategies. For virality or word of mouth, for example, one of the key factors in any virality formula is how many people can talk about or share your product. The more retained users, the more potential sharers. For content, the more retained users, the more content, the more that content be shared or discovered to attract more users. For paid acquisition or sales, the more retained users, the higher lifetime value, the more you can spend on paid acquisition or sales and still have a comfortable payback period. Retention really is growth’s triple word score.

What are effective ways to increase retention?
Okay, so you understand retention is important and want to improve it. What do you do? Well, at a high level, there are three types of efforts you can pursue to increase retention:

  1. Make the product more valuable: Every product is a bundle of features, and your product may be missing features that get more marginal users to retain better. This is a journey for feature/product fit.
  2. Connect users better to the value of the product that already exists: This is the purpose of a growth team leveraging tactics like onboarding, emails and notifications, and reducing friction in the product where it’s too complex and adding friction when it’s required to connect people to the value.
  3. Create a new product: Struggling to retain users at all? You likely don’t have product/market fit and may need to pivot to a new product.

We discuss these strategies in a lot more depth in the upcoming Product Strategy program coming soon from Reforge, and if you really want a deep dive on retention, we build the Retention & Engagement deep dive.

Why does retention differ so much across categories?
One question you might be asking yourself is why does retention differ so much by different categories? This was the impetus for the initial research, and why I couldn’t give a great answer to our board. Every company has a bunch of different factors that impact retention:

  • Customer type: For example, small businesses fail at a much higher rate than enterprise businesses, so businesses that target small businesses will almost always have lower retention.* This does not make them inferior businesses! They also have many more customers they can acquire.
  • Customer variability: Products that have many different types of customers will typically have lower retention than products that hone in on one type of customer very well.
  • Revenue model: How much money you ask from customers and how can play a big role in retention. For example, a customer may be more likely to retain for a product they marginally like if it costs $30 vs. $300,000. A product that expands revenue per user over time can have lower retention than ones that have a fixed price.
  • Natural frequency: Many products have different natural frequencies. For example, you may only look for a place to live once every few years (like my time at Apartments.com), but you look for something to eat multiple times of day (like my time at Grubhub).
  • Acquisition strategy: The way a company acquires users affects its retention. A wide spread approach to new users may retain worse than carefully targeting users to bring to your product.
  • Network effects: Network effects may drive retention rates up more over time vs. businesses that do not have these effects. For example, all of your friends on Facebook or all of your co-workers on Slack makes it hard to churn from either product whereas churning from Calm or Grammarly is entirely up to you.

* In those businesses, the business failing and churning as a result is called “involuntary churn”, though that can also mean a payment method not working for someone who wants to retain in other models.

BONUS: Why are Casey’s benchmarks for consumer transactional businesses lower than others?

For the demand side of transactional businesses, where the retention graph flattens is more important to me than the six month retention rate. And unlike other models, these businesses can take longer than six months to have their graphs flatten. Also, for marketplaces, one of the two common models along with ecommerce in this category, a healthy demand side retention rate is very dependent on what supply side retention looks like and acquisition costs. For example, since Uber and Lyft have to spend so much time and money acquiring drivers due to a low retention rate, in order for their model to work, demand side retention either has to be high or demand side acquisition has to be low cost. For a business where supply side retention is high and acquisition costs are low, demand side retention can be lower, and the company can still be very successful. Etsy and Wag I imagine fit more into this model.

Currently listening to We All Have An Impact by Boreal Massif.

How I Grew This Podcast, and How I Unintentionally Started Working on Growth

I caught up recently with Mada Seghete, co-founder of Branch Metrics on her new podcast “How I Grew This”. In the podcast, I talk about my career in growth including some of my early experiments before I even had a real job. You can listen here:

I thought I’d go into a little bit more detail in this post despite how embarrassing it is.

When people ask about how I got into working on growth, I usually respond by talking about my job at Apartments.com, and how I had to measure everything the marketing team was doing to grow the business. It turns out measuring everything and its impact on growth gives you a pretty good understanding of the growth channels. And for me, one of the biggest lessons was that it was none of the things you learned about in marketing classes at school. It was things like SEO, affiliate marketing, paid search, distribution partnerships, et al. As I automated more of the tracking, it gave me more time to actually work on optimizing those channels. This is all true, but it’s not actually the start. So I’m going to talk about the start in hopes it helps other people figure out how to find opportunities to develop skills and learn. This is going to be a somewhat autobiographical post, and it may not be useful, but multiple people have said I should write in more detail about it, so I am.

My High School Passion: User Generated Content
I was pretty early to the user generated content trend. In high school. I spent a lot of time on AskMe.com, which was basically a pre-bubble Quora, answering questions about a range of topics including music, video games, and history. I answered over a couple thousand questions there. I also hung around the IGN message boards, which was the 3rd largest forum on the internet at the time. I became a moderator on IGN eventually for some of the music and video game boards. This is pre-Facebook, pre-reddit, pre-most things you spend time on the internet with. One interesting thing is how all of those multi-billion dollar companies existed in some form back then; they just didn’t become the valuable companies:

  • AIM = WhatsApp
  • IGN = reddit
  • AskMe = Quora

My College Obsession: Tony Hawk’s Pro Skater
In college, I started playing a lot of Tony Hawk’s Pro Skater 3 on the GameCube. I got pretty good at it. When I went online, I eventually found a community of the early online players playing on the Playstation. They were a lot better than me, and posted videos for download of them reaching new high scores. This was pre-Youtube, so they used various archaic methods of recording (I, for example, used a capture card and a VCR to record the play), uploaded them to a server, and you had to download them to play the videos locally on your computer.

I watched all of the new videos. Not only were they entertaining, but they helped me learn how to get better myself. All of the best players used loops of the level to repeatedly hit parts of the level that allowed them to do valuable tricks. Many people started to post tutorials of their loops. You can see one of the loops I used for a good score here (sorry for the quality. All of this was recorded before Youtube existed, and when we finally did upload things to YouTube, they didn’t support high quality yet):

When Tony Hawk’s Pro Skater 4 came out, it became super easy for these players to score billions of points in one combo using these loops, so the quest for higher and higher scores lost its luster. Instead, the best players switched to showcasing themselves doing stylish combos without ever touching the ground. They called these videos “no manuals” or “nm’s” as the manual was a trick introduced in Tony Hawk’s Pro Skater 2 to link combos on the ground. Essentially, these players challenged themselves to play Tony Hawk’s Pro Skater 4 as if it were the first Tony Hawk’s Pro Skater. The entire community shifted from a score based system to a style based system.

When Tony Hawk’s Underground came out, the community didn’t love many of the changes. You could now walk to link combos, which made something that was too easy for the best players even easier, and people stopped posting videos. I was dismayed as well, because the volume of content coming from the community dropped precipitously.

My First Growth Loop: The Get There Challenges
Worried that this community I loved was dying, I tried to think of ways to revive the community. I essentially needed a way to prompt people to post stylish videos. I came up with an idea. I would post a screenshot of a piece of a level in one of the Tony Hawk games to start. I’d post another screenshot of a place you had to get to in the same combo. And you had to do all of this without touching the ground (no manuals, walking, or reverts). The first to complete it got to post the next challenge. I posted two of them to make sure someone would bite, called them the “Get There Challenges”, and a player named Milky posted of a video of himself completing the second. I awarded him the win and challenged him to post the next challenge. He did, and the Get There Challenges were born. Within a day, someone had beaten Milky’s challenge. The loop had officially begun.

By the eighth challenge, the community started adding variations, such as shortest to complete, coolest version to complete, and sub-challenges. Eventually, some even allowed manuals. A website was built (not by me) to host them officially, and a bunch of copycat websites tried to start their own. GT’s (as they had become known) became a pillar of the Tony Hawk’s Pro Skater online community. Over 300 challenges were consecutively posted and completed over the course of the next three years.

Most of these videos are lost to time. Mike, one of the best players in the community, did create a video commemorating 100 challenges, which is probably the best introduction to the concept. Apologies for the video quality, the out of context teenage jokes, and most importantly, the music choices used in the video.

Now, I am probably an idiot for not using this concept to build a billion dollar business ten years before esports and three years before Youtube became a thing. But the framework of the Get There challenges continues to serve me in my career in other ways. I have come to call these loops content loops and not viral loops as what they do is generate content that attracts people instead of invites. I have built a course on them and talked about them. The Get There challenges have a similar dynamic to how Eventbrite (event listings), GrubHub (menus), and Pinterest (boards) have grown. People mistake this as an SEO strategy, but it’s not. As long as you have a place for the content to be discoverable, it can be a loop if enough people interact with it.

There is much more of an opportunity today to leverage your hobbies for learning opportunities than there were when I was a teenager, whether it’s new creation tools available or all of these new online communities. You may be surprised what you learn from them and how they can inform your eventual career.

Bonus content with much better music:


Currently listening to Ritorno by Andrea.

Q&A with Elena Verna at Amplitude Amplify Conference

I recently gave a presentation at the Amplitude Amplify Conference on Growth Models. I then had the pleasure of interviewing one of my favorite leaders, Elena Verna, GM of the Consumer Business at MalwareBytes and previous SVP of Growth at SurveyMonkey. The video is now online. We talk about how MalwareBytes and SurveyMonkey grow, the different types of word of mouth, how to think about freemium as a strategy, the content loops of SurveyMonkey and Eventbrite, building network effects, and much more.

Announcing the next Retention Deep Dive, Growth Series, and something new

Over the last few years, I’ve worked with Brian Balfour (CEO Reforge, formerly VP Growth @ HubSpot) as a Growth mentor and contributor to the Reforge programs. These are part-time programs (no need to take time off work) specifically designed for experienced Product Managers, Marketers, Engineers, and UX/Designers in both B2B and B2C companies.

Today, Reforge announced their three upcoming programs this fall:

1) The Retention + Engagement Deep Dive program. I worked closely with Brian developing this program, which looks at every aspect of retention including activation, engagement, resurrection, and churn.

2) The Growth Models Deep Dive program. This is a new, detailed examination of a key growth topic Brian and I developed this year with Kevin Kwok.

3) The Growth Series program. This is Reforge’s flagship program that provides an overview of the key topics in growth that’s been 100% revamped to reflect today’s growth challenges.

Apply to Reforge (Takes ~5 minutes)

Each Reforge program runs from September 24th through November 16th. Seats always fill up fast, and I’m excited to be involved. I’ll also be doing some speaking and Q&A during the events.

Besides Brian, Kevin and myself, other hosts include Andrew Chen (General Partner @ Andreessen Horowitz), Shaun Clowes (VP Growth @ Metromile, former Head of Growth @ Atlassian), Dan Hockenmaier (former Director of Growth @ Thumbtack), Heidi Gibson (Sr. Director of Product Management @ GoDaddy), and Yuriy Timen (Head of Growth @ Grammarly).

About the Reforge Programs
These are all invite-only, part-time programs that last 8 weeks. Each program requires a time commitment of 4 – 8 hours per week. They’re designed for Product Managers, Marketers, Engineers, and UX/Designers in both B2B and B2C companies looking to accelerate growth in their companies and in their careers by developing a systematic approach to thinking about, acting on, and solving growth problems.

In addition to the course material, we’ll also hear from leaders in the industry through interviews, live talks, and workshops, including:

Fareed Mosavat, Growth @ Slack
Ken Rudin, Head of Growth, Search @ Google
Brian Rothenberg, VP Growth and Marketing @ Eventbrite
Ravi Mehta, Product Director @ Facebook
Mike Duboe, Head of Growth @ Stitch Fix
Josh Lu, Sr. Director, PM @ Zynga
Guillaume Cabane, VP Growth @ Drift
Matt Plotke, Head of Growth @ Stripe
Joanna Lord, CMO @ ClassPass
Gina Gotthilf, ex-Growth Lead @ Duolingo
Elena Verna, SVP Growth @ MalwareBytes
Kieran Flanagan, VP Growth/Marketing @ HubSpot
Naomi Pilosof Ionita, Partner @ Menlo Ventures
Nick Soman, ex-Growth Product Lead @ Gusto
Nate Moch, VP Growth @ Zillow
Simon Tisminezky, Head of Growth @ Ipsy
Steve Dupree, Former VP Marketing @ SoFi
See the full list here

Here’s some more detail about each program below:

About the Retention + Engagement Deep Dive
Retention + Engagement Deep Dive zooms in on one of the most important sub-topics of growth.

Retention and engagement separates those companies in the top 1% of their category. Every improvement in retention improves acquisition, monetization, and virality. But moving the needle on retention is hard.

This program takes a microscope to every aspect of retention, including:

  • Properly define, measure, segment, and analyze your retention
  • Find and quantify the three moments every new user goes through to create a long-term retained user
  • Construct a high performing activation flow from the ground up using detailed strategies across product, notifications, incentives, and more
  • Layer your engagement strategies to build a compounding growth machine at your company
  • Articulating retention and engagement initiatives across teams, as well as influencing how leaders think about retention in your company
  • Walk step-by-step through of lessons applied to dozens of examples from companies like Instagram, Zoom, Spotify, Everlane, Airbnb, Turbotax, Jira, Credit Karma, Blue Bottle
  • And more…

The Retention + Engagement Deep Dive is designed for growth professionals who are looking to zoom in on retention, either because their job is focused on retention, or because they already have an advanced working understanding of the quant and qual fundamentals of growth and are looking to build additional competency in retention and engagement.

Apply for the Retention + Engagement Deep Dive

About the Growth Models Deep Dive
The new Growth Models Deep Dive addresses an essential new skill and topic that every growth practitioner needs to understand. Your growth model is the essential tool that drives alignment, prioritization, strategic investments, metrics, and ultimately, growth. Without it, your team ends up setting faulty goals, focusing on sub-optimal initiatives, and running in opposite directions.

This program goes deep into growth models across companies. You will:

  • Learn how the fastest growing products actually grow (hint: the answer isn’t funnels)
  • Dissect how the fastest growing products like Uber, Slack, Dropbox, Stripe, Airtable, Instagram, Fortnite, Tinder, and others grow using growth loops
  • Learn the detailed components of 20+ growth loops
  • Systematically construct growth loops your product can use after analyzing the three qualitative properties of every growth loop
  • Assess gaps and uncover opportunities for growth by identifying, measuring, and analyzing your products existing growth loops
  • Complete a step-by-step walkthrough to build your quantitative model for a single loop and your entire product
  • Communicate actionable insights from your growth model to obtain buy-in from leadership and across teams
  • And more…

The Growth Models Deep Dive is designed for growth professionals looking to focus on growth modeling, either because their job requires modeling their company or product’s growth or because they’re in a leadership role. It’s especially useful for growth leaders looking to influence leadership, set a team’s direction, and rally colleagues using growth models.

Apply for the Growth Models Deep Dive

About the Growth Series
The Growth Series is a comprehensive overview of the key topics in growth. The program is designed to help you accelerate growth of your product, company and your career by creating a prioritized list of retention strategies, building your quantitative growth model, and much more. Plus, the Reforge team spent +100 hours collecting feedback, investigating new growth concepts with experts, and analyzing the latest strategies coming out of top companies to completely overhaul the content with new topics, frameworks, and relevant examples.

During the Growth Series, you’ll learn:

  • Going from understanding one or two pieces of your growth model to understanding how the entire system works together
  • Evaluating the key components of growth (acquisition, retention, monetization) and how they feed one another
  • How to construct a holistic growth model, bringing together all the components of the funnel
  • How to understand and evaluate the user motivations behind the levers in your growth model
  • Running a continual, self-reinforcing experimentation process to execute against your growth model and user psychology
  • Learn how to properly call, dissect, and analyze an experiment, plus implement the results across your team
  • And more…

The Growth Series is designed for practitioners who already know the basics of growth and are figuring out how to take the next step. Participants are assumed to have knowledge about A/B testing, ad buying, and other fundamental tactics, and are ready to take on the bigger challenge of thinking about the entire picture of growth and forming a coherent and compelling strategy.

Apply to the Growth Series

Align Revenue to the Value You Create

“We want to create more value than we capture.”*

Tim Kendall, the former President of Pinterest, repeated those words at an all hands to describe our strategy for monetization a few years ago. My role as an advisor to Greylock’s portfolio companies allows me to work with many different types of businesses: consumer social, marketplaces, SaaS, etc. I’ve come to realize this saying describes an optimal strategy for a lot more than just an ad-supported revenue model. It should actually be the guiding light for most subscription software businesses.

Align Revenue To The Value You Create
One of the most common questions I receive from subscription businesses is when to ask for a signup and when to start charging customers. In freemium businesses, the slightly different question is how aggressively you upsell the paid product, and how good you make the free product. If you talk to entrepreneurs, you will get definitive answers from them, but they are frequently the opposite of each other. “You should never give away your product for free!” “You’ll never succeed without a free trial!” “Ask for credit card upfront! People won’t take the product seriously.” “Never ask for a credit card upfront! You’ll shoo too many people away.” The default answer I gave to entrepreneurs after hearing all of this feedback is that it depends on the business and needs to be tested.

As I researched more into the problem, these questions actually seemed to be the wrong questions to be asking. Harkening back to Tim Kendall’s advice, I started asking entrepreneurs, “What is the path to actually creating value from your service for your customers? How long does it take, and what actions need to be accomplished?” In other words, very similar advice to what is a successful onboarding? Once you learn that, you can determine how to capture some of the value you create.

Capture Value For The Business After Value Has Been Created For The Customer
When your product is subscription based, the prime time to ask for a subscription is after a successful onboarding occurs. It frequently is based on usage, not time. Dropbox is a famous example. The product is free up to a certain amount of storage. Once a user hits that amount of storage, they cannot add more files to Dropbox without paying. This storage amount also happens to be around the point where Dropbox becomes a habit, and represents real switching costs to find another way to share files across devices. So their conversion rates to paid are very high without any sort of time-based trial period. They don’t have a free product and a paid product; they have a free introduction to their paid product, and it becomes paid as soon as value has been created for the customer.

Your company may not have a long time to demonstrate value though, which may force your product to change to display (and capture) value more quickly. For startups based on search engine traffic, people reach your page with intent at that moment, and you frequently learn that this initial session is your only chance to convert them. So you push for a signup during that session after showing a preview of the value you can provide.

That is what we implemented at Pinterest, and it worked well, but it definitely created backlash from users for whom we had not yet created enough value. Once Pinterest was relevant on search engines for multiple topics, we saw people come back multiple times, and pulled back the signup walls on first visit. At that point, Pinterest was confident users would come back and thus focused on demonstrating more value before asking for signup.

Don’t Try To Capture Value In A Way That Reduces Value Created
It’s interesting to map the revenue growth of Dropbox to Evernote over the same time period. Evernote allows you to store an unlimited number of files and only makes you pay for advanced features like offline storage, storing large files, and (later) sharing on more than two devices. These features would have actually increased value created and switching costs if they were free, because Evernote’s value prop is about being able to access notes everywhere. If Evernote had instead mined their data and seen that people stick around after, say 50 notes, that would probably have had more effective monetization.

You only want to hide features from free users if they do not create habits or virality. Hiding sharing functionality before payment never makes sense because it introduces more people to the product for free. Hiding functionality that helps create retention also doesn’t make sense because you can always upsell retained users, but you can never upsell users who did not see the value and therefore don’t come back.

Decreasing Churn Is Long Term More Important Than Maximizing Conversion
Many people will decry that this strategy actually reduces revenue. In the short term, this sentiment is likely to be true. Decreasing churn might have a lower conversion rate upfront, but it aligns to long term successful retention. Churn rate is usually one of the biggest barriers to long term growth, so it’s worth thinking about this type of strategy even if it has a short-term decrease in revenue. It can be much harder to re-acquire someone after they have canceled, than charge someone for the first time who has been receiving regular value because you charged them for value you didn’t create.

What usually happens when a company captures more value than they create is they will have high revenue growth for a period of time (with a lot of investor enthusiasm), followed by a flattening of growth and then a steep revenue decline. This happens because revenue growth is a lagging indicator. Usage growth is the leading indicator. When usage lags revenue, this predicts churn. As you churn more and more users, it becomes harder and harder (and eventually impossible) to replace those churned users with new users to keep revenue metrics flat. Look at Blue Apron’s valuation to see this playing out currently as subscribers start to decrease for the first time year over year.

You Want Your Revenue Model To Align As Closely As Possible To The Value You Create
Lastly, as you start charging customers to capture value you create, you want your business model to align to the value that is being created. Email marketing tools have mastered this. Email marketing tools’ value is based on reaching customers with messages. Most email marketing tools charge on a CPM (i.e. a price for every thousand emails you send via their platform). As your email volume increases, they continue to drop the CPM. This make these companies more money because customers are sending a lot more email over time. But it actually becomes more valuable to the customer as well, because email is now cheaper on a per unit basis to send.

Compare this to Mixpanel, a product analytics tool. Mixpanel charges per event, and their value is delivering insights based on data from events being logged on your website or mobile app. The more events that are tracked in Mixpanel, the more insights the customer can receive, and the stickier the product. Since Mixpanel is charging per event though, a weird calculus emerges for the customer. The customer has to ask if tracking this event is worth the cost because not all events are created equal. Meaning the customer has to decide which data is important before they use the product. So, Mixpanel’s revenue model actually hurts its product value.

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It’s easy for subscription businesses to get attracted to the allure of short term revenue. The goal of your business is first to create value. The creation of that value and the understanding of how it’s created allow for more optimal and sustainable revenue generation opportunities. Don’t pursue short term revenue opportunities that prevent the customer from understanding the value your company creates. When you are generating revenue, you want to align that revenue model to how value is created for your customer. If you’re not sure, err on the side of creating more value than you capture rather than the opposite. This leads to long term retention and the maximization of revenue.

Naomi Ionita, General Partner at Menlo Ventures and former growth leader at Invoice2go and Evernote, and I talk more about this and other subscription growth problems in the Greymatter podcast.

*This quote I believe originally stems from Brian Erwin.

Currently listening to Shape the Future by Nightmares on Wax.

Getting Smart About Growth Podcast with Andrew Chen

Andrew Chen recently wrote a blog post about how growth is getting harder. I invited Andrew to the Greymatter podcast to chat more about why growth is getting harder, and more importantly, what to do about it.

We talk about how viral growth is on the decline in consumer, but not in B2B, and how to leverage paid referrals effectively. We also walk through trends in paid acquisition, how to find your first channel of growth, and much more.

The iTunes link is here, and here is the Soundcloud link for email readers.