"Steve Blank talks about the idea that tech companies die because of lack of customers, not inability to build technology. Marc Andreessen says it’s the only thing that matters."

"getting a low TTPMF is very easy: Just completely copy something that’s already at P/M fit."

"be aware that a 100% clone has many weaknesses"

"It’s uninspired You’ll never get to 1 since you can’t switch existing customers over You’ll never grow the market in a new direction, giving you a different base of users- compared to an incumbent competitor You let a competitor define the market, and you play catch up- you can never play offense If it’s a networks-effects business, you can’t just clone a product, you have to clone a community. That’s hard."

"keep the fundamentals the same (80%) while substantially reinventing 20% of the product."

"TTPMF has to be less than 1-2 years or else your startup will implode. Ask anyone who’s been working on a product for more than 2 years and doesn’t have traction to show: It really, really sucks."

"Ideally the differentiation is baked deeply into the core of the product, not out on the edges. Something the end user can see and feel within the first 30 seconds of using the product."

"getting user engagement is hard enough, but when you couple it with a high bar on user growth, it’s 10x harder. So leave enough time to work on your marketing optimizations to get your product going."

"the most useful definition of “market” is 100% consumer-centric."

"A market consists of all the consumers who can search for and compare products for a use case they already have in mind."

"The most concrete test of pre-existing demand is using the Google Keyword Tool, which tells you how many people are searching on Google for a particular keyword."

"What keyword do people search to get to your site? Put those keywords into Google Keyword Tool How many people are searching for this keyword?"

"If the answer to 3 is large (millions or more), then you have a large market."

"For consumer internet, a great market is commonly defined by: a large number of potential users high growth in of potential users ease of user acquisition"

"even if there’s a ton of competition, if it’s easy to acquire consumers to your product, that’s great!"

"Leading with a great market helps you execute your product design in a simpler and cleaner way. The reason is that once you’ve picked a big market, you can take the time to figure out some user-centric attributes upon which to compete. This leads to a strong intention for your product design, which drives a clean and cohesive UX."

"your product’s design can be more cohesive because you’re trying to do less, but better."

"keeping a cohesive product experience is quite hard, and removing features is usually harder than adding them."

"The problem with the treadmill is that your team and scale makes it hard to iterate substantially on the product and business."

"In the end, this story isn’t about polishing your product forever. I’m certainly not encouraging that. But I do think you need to understand where your product stands relative to other successes (and failures in the market). The benchmarking is important."

"The traction treadmill eventually arrives once the numbers get big. This is when you lose a % of users fast, but then just have the budget and funding to replace them- but then can’t keep grow on top."

"Today, too many connections is bad. Maintaining which of 1000s of high school friends and employers have access to which content, is quite simply a chore. Small chat groups simplify this. Algo-driven feeds also simplify by just showing you the best stuff. More will be invented to solve the problem of maintaining connections."

"The past generation of social apps won the market through a playbook"

"building big networks with feeds for discovery creating a followers/status competition for engagement bringing together creators and audiences monetizing with ads supporting photo, text, video"

"The next generation of social is necessarily a reactionary movement"

"small networks or algo-driven big ones creating real connection with people letting creators own their audiences monetizing directly with subs, NFTs, etc evolving media format towards interactivity"

"Today, creators are looking for more, and new apps can cater. A lot of the Creator Economy, of course, is a reaction to pre-existing platforms that get between a creator and their audience."

"NFTs, subscription, ecommerce, and other biz models now exist for creators."

"the “back office” will become an important battleground."

"new platforms will emerge that let people author 3D content more easily — and maybe put it into a game. Or interactive content. Or NFTs. And of course audio. All of these new forms of media will probably look like toys at first, but they may catch on in a big way."

"In a world where uploading a video was hard, it made sense that Youtube was the first type of app to be built. Social status and competition is an easy engagement hook."

"Web 2.0 was about a lot of things. There was big UX breakthroughs, like tagging, profiles, feeds, photos, and everything else in user generated content."

"one of the hardest lessons we learned from that period: It wasn’t enough to build the app, you needed to also grow a critical mass of users."

"Low engagement would lead to more low engagement."

"It’s still better to focus on a single community, gain saturation, before adding adjacent networks. Viral loops are still a thing that can be constructed, measured, and optimized."

"Today’s resurgence is comparable in scope, but with a larger maret, built on the supercomputer in our pockets"

"The key for founders is to know that there isn’t a single silver bullet to measure perfect engagement — rather, the goal is to find the set of metrics that are appropriate for their businesses."

"The Power User Curve will “smile” when things are good"

"It shows if you have a hardcore, engaged segment that’s coming back every day."

"the “Power User Curve” — also commonly called the activity histogram or the “L30” (coined by the Facebook growth team). It’s a histogram of users’ engagement by the total number of days they were active in a month, from 1 day out of the month to all 30 (or 28, or 31) days."

"Power users drive some of the most successful companies — people who love their product, are highly engaged, and contribute a ton of value to the network."

"While DAU/MAU — dividing daily active users (DAUs) by monthly active users (MAUs or monthly actives) — is a common metric for measuring engagement, it has its shortcomings."

"It shows the variability among your users: some are slightly engaged, whereas others are power users."

"Social products with frequent user engagement like this lend themselves well to monetization via ads—there’s enough users returning frequently that the impressions can support an ad business."

"successive Power User Curves should ideally show users shifting over more to the right side of the smile."

"The Power User Curve can show when strong monetization is needed"

"not every company needs to have a smile-shaped Power User Curve, just as not every product category necessarily lends itself to an ultra-high DAU/MAU"

"LinkedIn — few users are likely to actively check it on a daily basis, but that’s ok, since they have business models that aren’t tied to daily usage."

"Some products should be analyzed in a 7 day timeframe – like SaaS/productivity – and others on 30 days"

"Plotting the Power User Curve for different WAU or MAU cohorts can also be very insightful."

"For a network effects product, you might expect to see newer cohorts gradually improve as you achieve network density/liquidity."

"The Power User Curve can be based on core activity, not just app opens or logins"

"As the CEO or product owner of a platform like this, it’s important to design the platform such that the everyone has a chance to succeed."

"The beauty of the Power User Curve over DAU/MAU is that it shows heterogeneity among your user base, reflecting the nuances of different user segments"

"it’s hard to figure out who a perfect candidate is – it isn’t until you see 10 candidates that you start to hone into what you really want and like."

"It’s very important to hire people who are execution-focused early on."

"Watch out for people who are so deep in one area that they seem to be overspecialized – it can be a signal for a lack of interest for pitching in on areas that might be vital for your team, or they may have nothing to do if your startup inevitably changes directions."

"I’ve come to believe that the first batch of people you want on your team are going to be T-shaped, meaning they are broad in a bunch of different areas and deep in a particular one."

"hire people who have recently had titles as team leads or directors, but nothing more senior."

"The other type that you find that’s not execution-oriented is the philosopher type."

"they may be more interested in reading blogs and indulging themselves intellectually than really working hard on a team to get a lot of work done."

"The ideal interview, imho, is just to interview, then work together for 2 months and do a checkpoint to see if it’s working OK."

"startups are really hard, and often take more time than you think they will – as a result, it’s important to understand peoples’ motivations to make sure it’s a good match from the beginning."

"How do they see work fitting in their life? Does the style match? (Mornings vs late, hours, etc.)"

"Mutual goals and motivations – money versus serving a goal versus learning versus others What stage of startups do they like? Seed, mid, later on? Why? Long-term goals – create a great lifestyle company, or try to go big?"

"if you have really smart mercenaries in the team, it may work well for when things are going well, but there’ll be significant issues if there are any hiccups"

"the ideal scenario is to find people who have a passion for the particular product you’re bringing to market, and then training them to be metrics-oriented, versus taking people who love numbers/data/algos and trying to train them to love a particular product area"

"A question every entrepreneur asks is, if I build it will they come?"

"tapping into a large market with pre-existing demand makes things easier."

"going after markets where users are already familiar with with your product category, the different options, and you build a product that is better against some competitive axis."

"Some of the Valley’s best companies, like Google, Facebook, and Apple’s mobile products, entered their respective markets late in the game and effectively competed with differentiated products to win."

"for ideas in spaces with lots of competition, if you are able to get to scale and differentiate along some key dimensions, ultimately your traction lets you do all sorts of fun innovative stuff later on."

"It’s easier to reinvent something than to invent it."

"One of the key tools that you can use here is the Google Keyword Tool."

"my favorite use cases are to validate how mainstream a product category is, make sure you are using customer-centric wording to describe your product, and to identify nearby product positioning options."

"If you plug in keywords related to your business and find very low numbers, it might mean you’re using wording that mainstream users don’t understand or don’t care about."

"Steer your product towards a category with millions of pre-existing consumer searches – this shows mainstream understanding and demand for your product category"

"If people are searching for products in your category then you are in an existing market."

"One of the best uses of the GKT is for finding the right words to describe your product."

"If you plug in your high-concept pitch and you get millions of searches back, then you’re in good shape."

"If I asked my customers what they want, they simply would have said a faster horse."

"Build a car, not a faster horse, yet start by describing as a faster/better horse until people understand what cars are. Afterwards, build on that term."

"sometimes, you find millions of users searching for something that doesn’t exist- that’s pretty awesome, and a great opportunity if you can execute a really compelling product there."

"have a vision for your product, and execute against that. Invent and build cars, but market it as a horseless carriage so that people know what they’re buying and why."

"it’s still important to try this out, when your entrepreneurial intuition says it’s the right way to go- but remember that you might have to go through a step of cleaning up the marketing and messaging around your product to slot it into something consumers understand."

"My investing thesis. The intersection of growth hacking, new tech, and pre-existing consumer motivations"

"even with the backdrop of all of these new technologies, we are still fundamentally the same people from many eras ago. We haven’t physically changed much."

"while technology changes rapidly, people stay the same. And that’s the opportunity."

"This is a really clever effort for Michelin, because by packaging all the destination restaurants across France, and eventually Europe and the world, they gave people a reason to drive."

"the best feature they built is the “take a selfie and see what kind of famous artwork you resemble” feature. As we saw earlier, we’ve always been obsessed with selfies."

"Getting people to tell their friends and family to spread the word is something that’s always worked – and it works today as well!"

"you can get people to tell their friends and family, if you make it enticing for them, and also for yourself."

"A hundred years ago, CPGs used advertising and coupons to drive demand to solve their chicken and egg. Today, startups use awesome mobile apps to create demand and to solve the same problem. It still works."

"When there are new technologies and platforms hitting scale… … and products tap in pre-existing consumer motivations … and there are “growth hacks” that create slingshot opportunities to quickly and scalable grow"

"the first of the triumvirate is critical – and that is new technologies and platforms."

"So there are a ton of new technologies right around the corner. We just need one or two to break out, in addition to the surefire opportunities around marketplaces, B2B, mobile, and other existing categories."

"The question is: Which platforms am I most excited about? What are examples of growth tactics that are working now that are super clever? In the intersection of the three things I mentioned earlier, what would I zoom in on?"

"Video is huge, but not just for music videos. It can be used by many other forms of entertainment and media to boost their growth as well."

"My hypothesis: One of the big opportunities right now is that any product that automatically generates video when users engage will create more video sharing activity, thus more viral acquisition and engagement."

"It’s no wonder that one of the company’s slogans is – “Fun to play, but fun to watch too.”"

"As online channels become saturated – Facebook and Google ads are expensive, there are literally millions of apps in the app store – it turns out the real world gets pretty attractive."

"Even the fully utilitarian version – going from point A to point B – can be social, since there’s often a person on the other side."

"Technology changes, but people stay the same. If we can spot the new, breakthrough products that can grow at the intersection of this technological change, and peoples’ behaviors, then we’ll build the next generation of startups."

"Based on Quettra’s data, we can see that the average app loses 77% of its DAUs within the first 3 days after the install. Within 30 days, it’s lost 90% of DAUs. Within 90 days, it’s over 95%. Stunning."

"The key to success is to get the users hooked during that critical first 3-7 day period."

"where I see that most of the leverage in improving these retention curves happen in how the product is described, the onboarding flow, and what triggers you set up to drive ongoing retention."

"users find the top apps immediately useful, use it repeatedly in the first week, and the drop off happens at about the same speed as the average apps."

"Bending the curve happens via activation, not notification spam"

"the best way to bend the retention curve is to target the first few days of usage, and in particular the first visit."

"Whatever you do, sending a shitload of spammy email notifications with the subject line “We Miss You” is unlikely to bend the curve significantly."

"A feedback loop that rewards content posters when they push new content into the network A feedback loop that rewards passive content consumers with relevant and valuable content A feedback loop that rewards (and culls) connections within the network"

"when even one feedback loop starts to fail, reverse Metcalfe’s Law goes into effect, leading to stagnation and ultimately, network collapse"

"The feedback loops for social product aims to think in terms of why these feedback loops are able to create happy emotions and build up habits."

"The feedback loop that’s important here is to reward content posters with social feedback."

"If content creation is easy enough, and the social feedback is compelling enough, then you do more. And so the loop continues."

"The initial trial users started inviting more people and the Clubhouse community swiftly encompassed a burgeoning and diverse set of people and conversations. Groups quickly began to form around hobbies, cultures, careers, and curiosities."

"Clubhouse could not have come at a better time for social media. It reinvents the category in all the right ways, from the content consumption experience to the way people engage each other, while giving power to its creators."

"Clubhouse lets users communicate nuanced, detailed ideas in conversation; not everything needs to be bite-size or tl;dr. It’s the opposite of a video clip or a short post because it rewards discussion and exploration."

"a typical product might see 90% refuse to sign up to a product. And then of the ones who do sign up, over 90% of users disengage and become inactive over time."

"Mobile apps often have better engagement metrics, but have lower upfront conversion rates."

"If we’re talking about the homepage, we’d expect signup rates to be much higher. The reason is that this traffic is usually based on word of mouth, which leads to sign up rates that are 10% or higher, since people are looking for your product in order to try it."

"often over 90%, aren’t engaged on a daily basis. Instead, they’ve churned or are only active a few days per month."

"Anything more than 10% of your total users coming back every day is a success case! More often it’s 5%, or even lower."

"If your engagement or frequency sucks, figure out how to tie it into someone’s pre-existing behaviors, rather than asking them to do something new."

"You’d be surprised to know that often 50% or more of your users don’t know anyone else in the service, meaning that you need to backfill their feed with a bunch of content just from one person, or worse yet, impersonal content."

"one of the most explosively viral products in recently history had a full 65% of their users disconnected from anyone else: Instagram."

"the fact that only a few percentages of users will author content (known by the 1% rule), then you can imagine why creating a healthy, dynamic news feed is so hard."

"people aren’t signing up, and if they do, they don’t use the product nor have a good experience. It’s very hard."

"just as I say that a 30% DAU/MAU is good, when you compare that to Whatsapp’s 70%, you can see the gulf between good versus great."

"At the moment that your New+Reactivated is equal to your Inactive users, each time period, then you hit peak MAUs. This is the thing to watch for, because then it’s all flat or down from there."

"The problem is that the Growth Accounting Framework provides for lagging metrics. It’s hard to predict the future."

"to think about the quality of the loops – how defensible and proprietary are they? How scalable and repeatable? Is there upside in optimizing them or adding to them further?"

"The key thing to ask for the Acquisition Loop is to understand how a cohort of new users leads to another set of new users."

"if I see a startup that doesn’t directly ask for the signup, I assume there’s upside that can be gained."

"The first thing to ask for is the product’s Acquisition Mix. This is a look at signups broken down by channels/loops and by time period (ideally weeks). I’m looking for signals that the dominant channel(s) are proprietary and repeatable. Ideally they are loops."

"It turns out that one of the biggest determinants of “quality” of new users is the source of the user. As a result, you want to understand both how signups are being generated by various channels, via the Acquisition Mix report above, but also a sense of the quality by understanding the activation rate by channel."

"If all the users have come from beta users list or Product Hunt, that won’t scale over time. On the other hand, if marketing spend and product efforts are going towards high-quality channels, that’s fantastic."

"It’s important to understand the underlying platform of any acquisition loop because things can collapse quickly."

"Once you have all of this together, then you ought to be able to create a series of scenarios on where your growth curves are going to go."

"If you have a network-based product, like Dropbox or Slack, then you need active users to engage each other. If it’s purely a utility, then you want engagement in one time period to help set up engagement in a future time period."

"there are linear channels to re-engage users. These are useful, of course, but again, they don’t scale. It’s better when users re-engage each other or when users re-engage themselves."

"The social feedback loop fundamentally is built on the content creation step. If it’s not easy, then it won’t work. So it has to be an activity that a lot of users want to do."

"One key aspect of every network is the density of connections. It’s important to build the number of connections up, but they have to be relevant."

"The cohort curves need to flatten. Ideally >20%, so that each signup activates into a sticky, active user over time."

"To detect artificial engagement that’s being manufactured, not organically created by users, you can look at a breakdown of every notification that a product sends out. And the volume and CTRs over time."

"What I want to understand with a Frequency diagram is to segment high- and low- frequency segments, and start digging into their usage of the product. If you can upsell new use cases, then there’s a ton of upside."

"Engagement metrics are very hard to move compared to Acquisition. As a result, it’s better to assume the curves are what they are. But if you must add a bullish forecast, the right way to go is to focus on new user activation. And up-selling users from one frequency segment into the other."

"This is why achieving network density and easy content creation is so important- you need ways to bring people back into the network."

"They have big advantages over paid marketing channels, in that you give your CAC to your users, who then spend it within your product, as opposed to handing it over to Google or Facebook."

"A successful referral program can be 20-30% of your acquisition mix, as one of several acquisition loops."

"First, do all the things you’re “supposed” to do"

"Referral programs work very well for certain kinds of products, particularly ones that are already spreading via word of mouth."

"In Dropbox’s case, there is a natural use case between friends and colleagues — shared folders — which naturally complement the referral channel."

"Of course they don’t really work that well for products that have low LTV — that’s why we don’t see free social photo sharing apps reward their users for referrals."

"There’s no LTV to arbitrage against, and the referral amounts create a form of customer acquisition cost."

"When do you ask the user to refer?"

"What’s the incentive, is it extrinsic ($) or intrinsic (points, storage, etc)?"

"What is the success criteria for the program?"

"Product folks often start by agonizing over the ask. They wonder if it’s too trivial to create a “Get $5, Give $5” referral program, or if that’s too basic."

"I think that’s the wrong place to focus — after all, you can always word smith and test many variations later once you have the program up and running."

"The real question is, WHERE do you make the ask? And my answer is simple: Ask many times, in many places, with different messages, and in-context with whatever action you’re asking the user to take."

"Rather than trying to raise conversions, instead, show the screen more often — get more impressions!"

"Thus, make the referral ask part of the main flows."

"One of my favorite ideas from Uber is the concept of “holidizing” a referral campaign. For drivers, as the holidays approached, you might tell them to earn extra money towards gifts and festivities, by participating in a referral program."

"Why focus on new users? First, mathematically, it’s easiest to make a big impact when you are hitting a cohort of 1000 new users when it’s as close to 1000 as possible, not in day 30 when the cohort will have churned and gotten down to 150."

"And in the math of the viral factor, you have a better chance to hit >1 when you have 1000 users invite 1000 users than to ask 150 to invite 1000."

"Second, new users generally have more friends who haven’t yet used the product, because they are new themselves."

"The advantage of intrinsic rewards is that it’s particularly cost effective when the incentive is something you can control, like points."

"The problem with intrinsic rewards, of course, is that external users — people who have never heard of your product — are the least responsive to points or otherwise."

"Typically this is based on a basic calculation of CAC/LTV, which has major weaknesses as it doesn’t take into account cannibalization (which we’ll discuss later)."

"But the big lever on the incentive, of course, is to increase the amount — and the largest amount generally comes from tiered offers that have some form of breakage."

"The last aspect of the incentive structure I’ll discuss is a symmetric versus asymmetric offer — that is, should it be a “give $20, get $5” or “give $5, get $20.”"

"the inviter-centric amount generally works better — that is, catering to their self interest."

"I’ve also seen B2B contexts where in a professional setting, people tend towards inviting more if they are perceived as altruistic, giving out a large $ discount to others."

"So yes, of course look at the CAC/LTV of your referral initiative, but think about how you might compare the tradeoffs against everything else."

"The trickier ROI question is cannibalization"

"Cannibalization is a hard effect to tease out, but generally the goal is to measure something like “Cost Per Incremental Customer” by A/B testing offers to a control group that gets the standard number, and a test group that gets the elevated number."

"The other, simpler form, is simply to do an “On/Off test.” If you turn off all your referrals for a few days, do you notice a big drop in new users? If yes, then your referral program is working."

"For products that have a true network effect, as Dropbox does, the acquisition will eventually be taken over by intrinsic use cases like folder sharing rather than something as extrinsic as a referral reward."

"Building viral features and a referral program are similar problems — trying to get users to invite friends — but truly viral features around sharing and communicating are evergreen and create lasting value."

"In that way, I find myself a reluctant fan of referral programs — they can work, and can become a 10%+ acquisition channel for products — but they will always take a back seat for me, compared to building great viral functionality."

"First, you have to define the correct job requirements, and what you’re looking for ultimately depends on the context of your startup"

"The initial step is to define your needs."

"However, for the ones that do — and many consumer apps and consumerized workplace apps do — it’s an incredibly powerful idea that fundamentally changes the dynamic of the journey."

"In other words, it is the average case that the network effects that startups love so much actually hurt them."

"Most networks fail at the beginning. If a new video-sharing app launches and doesn’t have a wide selection of content early on, users won’t stick around if they can’t find what they want."

"I call these “anti-network effects” because these dynamics are downright destructive – especially in the early stage as it’s getting off the round."

"From these case studies, I describe an approach that focuses on building an “Atomic Network” — that is, the smallest possible stable network that is stable and can grow on its own."

"I also look at the product idea at the heart of every network effect, and the similarities many startups have used to pick the product and its features."

"I also ask, what are the first, most important users to get onto a nascent network, and why?"

"And how do you seed the initial network so that it grows in the way you want?"

"As a network grows, each new network starts to tip faster and faster, so that the entire market is most easily captured."

"This is the second phase of the framework, the Tipping Point."

"Each launch makes the next set of adjacent networks easier, and easier, and easier, until the momentum becomes unstoppable — but all radiating from a small win at the very start."

"This is why we so often see the most successful network effects grow city-by-city, company-by-company, or campus-by-campus as rideshare, workplace apps, and social networks have done."

"to the contrary, this is when technology companies start to hire thousands of people, launch a series of ambitious new projects, and try to continue the product’s rapid trajectory."

"The Escape Velocity stage is all about working furiously to strengthen network effects and to sustain growth."

"This is where the classical definition of a “network effect” is wrong. Instead, I redefine so that it’s not one singular effect, but rather, 3 distinct, underlying forces:"

"The Acquisition Effect, which lets products tap into the network to drive low-cost, highly efficient user acquisition via viral growth."

"The Engagement Effect, which increases interaction between users as networks fill in."

"And finally, the Economic Effect, which improves monetization levels and conversion rates as the network grows."

"the Acquisition Effect is powered by viral growth and the user experience that compels one set of users to invite their others into the network."

"I describe examples like PayPal and their viral referral programs, or LinkedIn’s recommendations for connecting as tactics that increase the power behind the acquisition force."

"The Engagement Effect manifests itself by increased engagement as the network grows — this can be developed further by conceptually moving users up the “engagement ladder.”"

"This is done by introducing people to new use cases via incentives, marketing/communications, as well as new product features"

"A rapidly growing network wants to both grow as well as tear itself apart, and there are enormous forces in both directions."

"This is when a network “hits the ceiling,” and growth stalls. This is driven by a variety of forces, starting with customer acquisition costs that often spike due to market saturation, and as viral growth to slows down."

"Similarly, there’s the Law of Shitty Clickthroughs, which drives down the performance of acquisition and engagement loops over time, as users tune out of stale marketing channels."

"And many other negative forces that grow as the network grows."

"In the real world, products tend to grow rapidly, then hit a ceiling, then as the team addresses the problems, another growth spurt emerges. Then followed by another ceiling."

"a successful product inherently comes with various degrees of spam and trolls. These are problems to be managed, not fully solved."

"The final stage of the framework focuses on using network effects to fend off competitors, which is often the focus as the network and product matures."

"using network effects to compete with competitors is tricky when everyone in the same product category are able to take advantage of the same dynamics."

"Every workplace collaboration is able to leverage network-driven viral growth, higher stickiness, and strong monetization as more users arrive."

"This dynamic drives a unique forms of rivalry — “network-based competition” — that isn’t just about better features or execution, but about how one product’s ecosystem might challenge another’s."

"Airbnb had to fight off its European competitor by competing on the quality of the network, and scaling its network effects — not via traditional competitive vectors like pricing or features."

"Because all products in a category likely have the same type of network effects, competition ends up being asymmetrical while leveraging the same forces."

"A larger network and the smaller network in any given market have distinctly different strategies — think of it as a David strategy versus a Goliath strategy."

"The upstart has to use its smaller size to pick off niche segments within a larger network, and build atomic networks that are highly defensible with key product features and when applicable, better economics and engagement."

"The incumbent strategy, on the other hand, using its larger size to drive higher monetization and value for its top users, and fast-following any niches that seem to be growing quickly."

"Goal: Getting a critical mass of users to prove product/market fit"

"Roadmap: A series of “Hustle”-driven efforts — often idiosyncratic, entrepreneurial, and surprising"

"It requires the founders to be very involved onboarding users, sometimes one-by-one, into the product."

"Yet it’s critical to develop an intuition around go-to-market and validate hypotheses on a new product’s growth strategy."

"Sometimes the really entrepreneurial projects — in product, but also in growth too — just have to be done by the founders."

"But more importantly, it should be qualitative. It should feel like it’s working."

"I often use benchmarks like D30 >20% or projecting out M12 to be >30% to try to assess this."

"After that, it’s time to stamp out these networks in a more repeatable fashion — this is when the market begins to “tip” in your direction,"

"Goal: Finding a playbook to find repeatable growth"

"Roadmap: Testing a series of more scalable growth channels, showing that if one network can be built, then multiple networks might be launched as well"

"They are hands-on, and has maybe led a small team before, but I’d prioritize tactical know how over management skills."

"During the interview, I tend to look for clear spikes in the specific channel that the team thinks is the most likely to succeed."

"if they are focused on paid marketing, that they understand retargeting down to the level of understanding why tracking “pixels” aren’t really pixels, how cookies actually work, how to calculate CAC/LTV when conversions happen months later, and so on."

"If they can pick it up quickly, can attract and retain talented employees for the various specializations, it can sometimes be the Plan B."

"I tend to lean away from people from the brand world, or from agency work, or who have only worked at larger companies. Speed of execution is just so important here."

"The biggest mistake I see here happens here is when the founders try to hedge their bets. They have a slide on “growth strategy” in their investor deck with 20 different ideas, when the key is to just iterate their way into 2-3 core things that work."

"At this point, the product is ready for Escape Velocity if it’s consistently growing >3-5x year-over-year growth rate with at least one (if not two) channels that are obvious levers."

"Goal: Scaling up growth across many efforts and channels"

"Roadmap: Multiple growth strategies — primarily 2 or 3 — that work in concert to grow the product to millions or tens of millions of users"

"So often there is a big effort to just grow the core. At the same time, there should be an effort to try a few big new channels."

"And then finally, there is the matter of integration — making the acquisition channels work alongside the activation/re-engagement products that happen over email and push notifications."

"What’s the biggest mistake that founders make in hiring their Head of Growth? In my opinion, it’s when the founders are trying to abdicate responsibility for their growth efforts, and hoping that a magical hire solves everything."

"The problem is, a startup’s growth is so fundamental that the founders have to take it on themselves."

"If the founders pick the wrong growth channel to double down, even if they hire an expert on the channel, most likely the journey will end in failure."

"If the founders hire some amazing growth folks but don’t give them the engineering and product support to get their loops to work, then it won’t work either."

"The second biggest mistake is probably to hire the “executive” Head of Growth too soon. If you are under 100 employees, you’ll only have a half dozen or dozen people working on growth, and in reality, you need a hands-on leader."

"And while marketplaces have been evolving into new areas for a while — including services — I especially love how marketplaces show up in interesting and sometimes unexpected places, places where technology has not gone before."

"Yet jewelry is one of the categories that could benefit most from modern trends such as social media, mobile, and mass personalization."

"That kind of exchange is ripe for technology to come in between and mediate things — not only efficiently connecting suppliers to buyers, but also expanding supply and demand for both sellers and buyers beyond local limits."

"Jewelry represents $200B+ of annual spend, but remains a highly fragmented and opaque market… it’s yet another way marketplace businesses can provide more transparency, variety, and even education for consumers."

"there are three mindsets that are compelling to me and that I love seeing in startup founders are: (1) an entrepreneurial mindset that’s baked in at all levels; (2) specialized expertise that can transfer across industries; and (3) technical challenges coupled with networks of talent."

"After months of iterating on different marketing strategies, you finally find something that works. However, the moment you start to scale it, the effectiveness of your marketing grinds to a halt."

"Law of Shitty Clickthroughs:"

"Over time, all marketing strategies result in shitty clickthrough rates"

"Novelty"

"Without a doubt, one of the key drivers of engagement for marketing is that customers respond to novelty."

"Retargeter posted an interesting analysis on the Importance of Rotating Creatives, which showed how keeping the same ad creative led to declining CTRs over time:"

"The point is, humans seek novelty yet are pattern-recognition machines"

"Any product that is first to market has a limited window where they will enjoy unnaturally high marketing performance, until the competition enters, in which case everyone’s marketing efforts will degrade."

"Another important way to think about the available market for your product is in terms of the popular Technology Adoption Lifecycle, in which early adopters actively seek out your product, while the rest of the mainstream market needs a lot of convincing."

"More scale means less qualified customers"

"In the TAL framework, the early market seeks out novelty, whereas the mainstream market just cares if you solve a problem for them."

"You can always get incrementally better performance out of your marketing by taking a nomad strategy – always keep developing new creative, testing new publishers, and so on."

"The real solution: Discover the next untapped marketing channel"

"In addition to doubling down on traditional forms of online advertising like banners, search, and email, it’s important to work hard to get to the next marketing channel while it’s uncontested."

"Questionable product/market fit meets premature scaling"

"It’ll kill your company."

"The blessing of a small user base"

"Even if you’ve bought 2,000 users, you might only retain 500 of them longer term. (So that you have 1000 actives + 500 new actives)"

"The problem is that a large % of these users burn off."

"The treadmill arrives"

"So then you’re starting to talk about very large outlays, just to stay afloat, much less to consistently grow."

"If things flatten for months, or a year, eventually morale becomes a problem."

"Options start to narrow. And the real solution – to increase stickiness – becomes too slow and complex to execute."

"The problem ultimately is that the early days of growth are less about the intrinsic quality of the product, and more about the ability for the team to ramp up spend."

"I do think you need to understand where your product stands relative to other successes (and failures in the market)."

"And if you try to scale and fix at the same time, be prepared for the treadmill to show up."

"By then, your nimble speedboat of a product will have grown into an aircraft carrier, and it’ll be hard to turn things around. This is when scale becomes the enemy to iteration."

"hands-free experience means that audio apps generally don’t compete with a vast competitive library of other startups. Instead, they compete with washing dishes, working out, driving."

"Listening to someone’s voice is personal, and hearing unedited audio is the opposite of seeing the highlights. It’s about ideas, not the visuals, so it emphasizes a different kind of content that can often feel deeper and more intellectually stimulating."

"In particular, we’re excited to see the emergence of platforms that provide user-generated content, live conversations, and other social interactions; a counterpoint to the highly produced, one-way nature of audiobooks and podcasts."

"One way to describe podcasting, for example, is that it’s a user-generated network."

"innovation in the content format, the evolution of the business model, and the growing ubiquity of audio."

"both long- and short-form content are likely to thrive on audio-first platforms."

"The same transition is likely to happen in audio."

"The next decade of innovation of audio will likely be as productive and valuable that of messaging, video, and other media to date."

"The draw of audio apps over other traditional formats is obvious to any podcast (and music) devotee: the ease. That lean-back, hands-free experience means that audio apps generally don’t compete with a vast competitive library of other startups."

"The most obvious killer app for audio is podcasting."

"In recent years, listening to podcasts has become more mainstream; today, more than half the US population has listened to roughly a million shows."

"One way to describe podcasting, for example, is that it’s a user-generated network. It consists mostly of semi-professional content creators broadcasting to a wide, public audience on a horizontal set of products and protocols."

"I believe three themes will emerge: innovation in the content format, the evolution of the business model, and the growing ubiquity of audio."

"The final theme is around ubiquity. In examining how messaging and chat has evolved, there has been a bifurcation between stand-alone apps and embedded features."

"The business model for content creation online has been evolving in recent years and is likely to accelerate in a world of audio and social platforms."

"both long- and short-form content"

"Just as many apps today support messaging, over time they’re likely to support synchronous and asynchronous audio, as well."

"But most of this is driven by advertising-based business models from the 1800s — the technology may have changed, yet the economic model is largely the same."

"What we love most about this age is that it can free many creatives, from all kinds of backgrounds, to pursue the type of creative work they love, and on their own terms."

"If you really think about it, the main asset that any content creator is building up — besides the content, of course — is their relationship with their audience. Yet most writers don’t really own that relationship with their audiences; their parent media brands and other platforms do."

"I began to recommend Substack to friends who were looking to start blogs or newsletters, or just wanted to share their writing in a trusted way."

"I also soon began to see Substack everywhere. People were promoting it in their Twitter profiles."

"Advanced discussion: Social Network Death Spiral"

"Metcalfe’s Law"

"The value of a network is proportional to the square of the number of users of the system (n²)."

"Metcalfe’s Law can also affect social app creators."

"you retain users well, and you don’t get a sharkfin graph on your traffic. In that case, if you combine the two ideas – Metcalfe’s Law and with the viral loops on the social platforms – you can imagine that in the success case, you are creating N^2 value with very large N."

"Eflactem’s Law"

"As you lose users, the value of your network is decreases exponentially"

"the scenario is that as the total users for the application reaches the carrying capacity, you basically hit a point of maximum saturation – this is defined by the ratio N/C."

"Once you hit the carrying capacity and acquire all possible users, N is at the highest point, and thus the network value is also at its highest point, V = N_max^2. Similarly, because the network value V is at its highest, the retention reaches its highest point as well."

"Does the network break through the critical mass of value?"

"Early on, maybe the userbase wasn’t sticking, but a critical mass threshold is met, and suddenly the entire userbase sticks, which creates a long-term creation of ad impressions and company value"

"if you don’t reach the required value in the network, then you’re pretty much screwed. Then the retention sucks, since the users aren’t finding value, and some percentage of them will leave. This will then remove more value from the system, causing yet another round of users to leave. This continual loss of users is a death spiral that collapses your network in fine Eflactem’s Law style."

"A very interesting variation of this is when you apply Metcalfe’s Law not to the entire network of users, but rather think of a social network as a loosely grouped set of connections."

"if the smaller networks around any given group start collapsing, then sometimes even the large networks will get pulled down with them."

"Gaining users is great, but preventing the loss of users is also very important"

"Creating a sharkfin graph on your traffic means exponential descruction of value"

"Critical mass plus network effects implies that complete collapse of networks is possible too"

"A feedback loop that rewards content posters when they push new content into the network"

"A feedback loop that rewards passive content consumers with relevant and valuable content"

"A feedback loop that rewards (and culls) connections within the network"

"Content posters that crave feedback (or utility)"

"Social products ultimately have some kind of content in the middle of it (sometimes called the social object), that determines the posting/consumption behavior of the content."

"It would be a mistake to assume that it’s as simple as wanting this content to be as simple as possible to create, because you also need to make it a frequent behavior."

"You’re already creating it, so it’s not a new behavior"

"You can create it in seconds"

"The tricky part of content creation is that the output has to be compelling to consumers, and over a long period of time."

"Yelp reviews, Stackoverflow, and others operate like this, with a push from SEO which help both creators and consumers find the site again over time."

"Ultimately, the balancing act between content creation cost, the frequency/retention of it, and how compelling the output is – well that’s the magic of a new product design."

"Content consumers want relevant content, updated frequently"

"The feedback loop for content consumers is simple: Every time they open your app or website, they see compelling content."

"Lack of content and stale content comes from using a friending/following method of connecting content posters and consumers – but often, the network is underdeveloped or isn’t growing fast enough"

"maybe there’s not enough friend density to drive a full feed."

"once there’s a nice balance of new content coming into a feed at about the rate that content consumers want to see it, something great happens. Then the engagement can lead to people giving social feedback to the folks who posted it in the first place – via likes, comments, re-shares – and that stimulates the production of more content."

"Connecting content posters and consumers to drive relevance"

"Leaderboards create a single public space where it’s difficult to create a “one size fits all” experience that makes everyone happy."

"ideally, you have a system in place where users can add (and remove) connections to other users easily, and the system is able to suggest more relevant connections."

"Building a checklist to ensure your loops are healthy"

"Stop the madness"

"First and foremost is maximizing the reach of your feature, so it impacts the most people. It’s a good rule of thumb that the best features often focus mostly on non-users and casual users, with the reason that there’s simply many more of them."

"The metrics behind the Next Feature Fallacy"

"The vast majority of features won’t bend the curve"

"Two mistakes are often made when designing features meant to bend this engagement curve:"

"Too few people will use the feature."

"Too little impact is made when they do engage."

"a product’s onboarding experience can be weak if there isn’t a strong opinion on the right way to use (and setup) the product."

"engagement wall, which exists at the moment that your product asks the user to deeply invest in their product usage, where “behind the wall” means that the feature can only be experienced once the users buys into a product, and engages."

"If you build a bunch of amazing features that are behind the engagement wall, then chances are, only a small % of users will experience the benefits."

"it’s important to have deep insights on what users need to do to become activated, so that their first visit is set up properly."

"For social networks, getting them to follow/add friends is key, because that kicks off a number of loops that will bring them back later on."

"the D7 retention is 40%”"

"this is further validation that the best way to bend the retention curve is to target the first few days of usage, and in particular the first visit."

"In an engagement loop that’s based on social feedback, you get a game of ping pong. One user messages/follows/mentions another, and they draw them back. And then that user might do the same, and draw in a different user. And this repeats."

"This is why achieving network density and easy content creation is so important"

"This is part of why marketing-driven one-off email campaigns are often ineffective. They don’t scale, aren’t interesting to users, and with enough volume, can cause folks to churn. Not good."

"Pinterest has many examples where they’ve optimized content creation"

"The social feedback loop fundamentally is built on the content creation step. If it’s not easy, then it won’t work."

"Once you create content, then you need to circulate it within your network."

"One key aspect of every network is the density of connections. It’s important to build the number of connections up, but they have to be relevant. And there’s diminishing returns too."

"An important way to build a social graph is to bootstrap on an existing network."

"There’s tactics like asking people to “Find Friends” and to build “People You May Know” features to increase density."

"The red flags here are folks who claim to have explosive viral growth just based on inviting. It won’t last, and they’ll be low quality signups. Similarly, if the core activity is all inviting and friending and there’s no main activity, that’s not good either. Better to let those ones go."

"Ultimately, the right attitude towards notifications is that they accelerate engagement that’s already there – you can’t make it out of thin air."

"Acquisition loops, which power the positive term for New"

"Engagement loops, which power the negative terms on Reactivation and Inactive"

"The key thing to ask for the Acquisition Loop is to understand how a cohort of new users leads to another set of new users. If you can get that going, then by a conceptual proof by induction, you’ll be able to show how it scales."

"Viral loops are important because they are extremely scalable, free, and don’t require a formal partnership. This is based on users directly or indirectly sharing a product with their friends/colleagues, and having that loop repeat itself."

"The red flags here are a bunch of new users from a new channel that’s actually low quality."