With more venture funding flowing into the startup ecosystem than ever before, there’s never been a better time to be a growth expert.
At Report Door Early Stage: Marketing and Fundraising earlier this month, Greylock Partners’ Mike Duboe dug into a number of lessons and pieces of wisdom he’s picked up leading growth at a number of high-growth startups, including StitchFix. His advice spanned hiring, structure and analysis, with plenty of recommendations for where growth teams should be focusing their attention and resources.
How to define growth
Before Duboe’s presentation kicked off, he spent some time zeroing in on a definition of growth, which he cautioned can mean many different things at many different companies. Being so context-dependent means that “being good at growth” is more dependent on honing capabilities rather than following a list of best practices.
Growth is something that’s blatantly obvious and poorly defined in the startup world, so I do think it’s important to give a preamble to all of this stuff. First and foremost, growth is very context dependent; some teams treat it as a product function, others marketing, some sales or “other.” Some companies will do growth with a dedicated growth team; others have abandoned the team but still do it equally well. Some companies will goal growth teams purely on acquisition, others will deploy them against retention or other metrics. So, taking a step back from that, I define growth as a function that accelerates a company’s pace of learning.
Growth is everyone’s job; if a bunch of people in the company are working on one problem, and it’s just someone off in the corner working on growth, you probably failed at setting up the org correctly. (Timestamp: 1:11)
While growth is good, growing something that is unsustainable is an intense waste of time and money. Head of growth is often an early role that founders aim to fill, but Duboe cautioned early-stage entrepreneurs from focusing too heavily on growth before nailing the fundamentals.
I’ve seen many companies make the mistake of working on growth prior to nailing product-market fit. I think this mistake becomes even more common in an environment where there’s rampant VC funding, so while some of the discipline here is useful early on, I’d really encourage founders to be laser-focused on finding that fit before iterating on growth. (Timestamp: 2:29)
Where to focus growth energy
The bulk of Duboe’s presentation focused on laying out 10 of the “most poignant and generalizable” lessons in growth that he’s learned over the years, with lessons on focus, optimization and reflection.
Lesson 1: Distill your growth model (“business equation”)
Growth modeling and metric design — I view as the most fundamental part of growth. This does not require a growth team so any good head of growth should require some basic growth model to prioritize what to work on. (Timestamp: 3:09)
The first point Duboe touched on was one on how to visualize your growth opportunities using models, using an example from his past role leading growth at Tilt, where his team used user state models to determine where to direct resources and look for growth opportunities.
Lesson 2: Retention before acquisition
The second lesson is to prioritize retention before driving acquisition, a very obvious or intuitive lesson, but it’s also easy to forget given it’s typically less straightforward to figure out how to retain users versus acquiring new ones. (Timestamp: 4:19)
Retention is typically cheaper than acquiring wholly new users, Duboe noted, also highlighting how a startup focusing on retention can help them understand more about who their power users are and who exactly they should be building for.
Lesson 3: Embrace ideas from all corners, but triage
Bringing on new ideas is obviously a positive, but often ideas need guidelines to be helpful, and setting the right templates early on can help team members filter down their ideas while ensuring they meet the need of the organization.