Edmonton Lean Startup Circle

Growth Hack #1: Insta-follow Upon signing up for Pinterest you are automatically following a select group of high quality users. This in turn helps alleviate the cold-start problem, where I have to go looking around the site to find boards and people to follow. Instead I get a sampling of high quality content immediately filling my feed.

Growth Hack #2: Facebook Friend Follow When you sign up for Pinterest with Facebook, your friends who are already using Pinterest auto-follow you and you follow them back. But all this auto following doesn’t seem to happen all at once but is staggered over time so that you get periodic notifications that someone has just started following you on PInterest. This brings you back to the app again and again. This also helps alleviate the cold-start problem and gives me a social incentive to maintain my presence on the site, lest I look boring in front of my friends.

But first, you need a great product Let me note that if people aren’t using your product, then you’re wasting your time spending too much time optimizing growth. You need a base of users who are happy and then your job is to scale it.

Planning and model building The planning/modeling side of things is really about understanding, “Why does growth happen?” Every product is different. You might find that people find you via SEO and then turn into users that are retained via emails You might find that people come to your site via web and then cross-pollinate to mobile, and that’s the key to your growth. You might find you need to get them to follow a certain # of people. You might realize they need to clip a certain # of links to get started.

Summary To summarize the above: Have a solid product where your users are happy Coming up with a model for how your site grows Trying out ideas and deploying them as A/B tests If the site grows, then try out more ideas. If it doesn’t, rethink the model in step 1 because it might be broken

There is a fascinating chart published in a Wired Article about a program called “SuperMemo” created by Piotr Wozniak to help people remember things. The chart shows the importance of irregular reminders on the ability of the human brain to retain information.

1) A Growth Hacker, like a “visionary”, is only anointed with the sacred oil of growth hacking ex post facto. Once, you have delivered huge and exponential growth in users/leads/sales, you are a Growth Hacker.  Before that, you are a Growth Rookie. <— ain’t nuthin’ wrong with being a Growth Rookie.

Growth hacking comes after the early stage chaos and post-product-market-fit.

This bears belaboring: growth-hacking comes after most, if not, all elements of your business model have already been figured out and shown to work — especially, the paramount elements of your market segment (who), your value prop (what) and marketing channels (how).

“Hi Elle, what’s the angle?”

“Arbitrage on parsing shipping data,” I reply. “Well, everyone has an angle.”

My Dad explained that hedge funds are truly a dime-a-dozen in the finance world, not dissimilar from angel investors.

“Growth teams are constantly iterating and developing new concepts,” said Dan Martell, founder of Clarity.

This process can be an unnecessary distraction to core product development. This is why it is best for an autonomous team to test and focus on growth.” Growth teams and growth hackers are in a perpetual state of “work-in-progress,” which can slow core product momentum with its mindset of iteration and testing.

“Ideally, a growth hacker can single-handedly put in a bunch of changes, such as A/B tests for copy and buttons,” said Mike Greenfield, 500 Startups Growth Hacker-In-Residence and co-founder of Circle of Moms. “One person with both technical and marketing skills can reduce friction and facilitate rapid iteration. Growth success comes from a lot of this background work.”

Growth hackers are creative, constantly on the lookout for ways to increase acquisition, adoption, retention, revenue, and referral. They are disciplined, subjecting themselves to an empirical process to determine what works and what doesn’t. They understand that the product itself is the most effective marketing tool. And they are technical enough to leverage existing platforms to reach the billions of users at their fingertips.

We posted it around the web (HN, Reddit, FB etc), and it quickly rose to the front page of HN where it stayed for about a half hour, before getting crushed by the mods.

One of the themes that came up a lot was the idea of the growth team finding a leading indicator of a user who would turn into an engaged user later on. The growth team would then focus on optimizing for that metric. 

Characteristics of leading indicator metrics The various leading indicators fit into three categories: Network density: friend or following connections made in a time frame Content added: files added to a Dropbox folder Visit frequency: D1 retention

Other points from the speakers A few other interesting things were mentioned at the conference. Josh Elman mentioned that Twitter has two degrees of an active user: a plain “active user” is someone who has visited their timeline at least once in the last 28 days a ‘retained’ or ‘core’ user is someone who has visited their timeline at least 7 times in 28 days.

Behind the term 'growth hacking'The concept for growth hacking grew out of the fact that most startups fail, and needing to not fail. When you think about games, the market is filled with large companies with lots of money to throw into marketing. Sean summed this need up well, with: When you're competing against Sony, you can't go dollar for dollar

2. A Must-Have Experience Sean focused on the importance of a Must-Have Experience (MHX) - you must have a hook that clearly identifies what this is.

3. Uncovering your MHXTo get a clear understanding of what your MHX is, Sean suggested reaching out to your Must Have Users (MHUs)… but what is a MHU?

I was once on the board of a company that was cash-flow positive early in its life. The entrepreneur decided to raise more money, even though he didn’t need to. I was perplexed and asked him why he was raising the amount of money he had decided to raise. His answer was that when he had no cash in the bank, he was willing to run $1,000 experiments. When the company was cash-flow positive, he was comfortable running $10,000 experiments. He now wanted to feel comfortable running $100,000 experiments, and this financing enabled him to do this. If he ran a $100,000 experiment and it failed, it wouldn’t tank the business.

When an experiment works, do more of it. So the $10,000 experiment that pays for itself in three days by generating $4,000 of gross margin on a daily basis is worth doubling down on and running at the $20,000 level. If this generates $8,000 of gross margin on a daily basis, double down again.