startup turkey 2016 - sam mallikarjunan
TRANSCRIPT
SamMallikarjunanHubSpot
The FIRST Framework For Growing a Successful
Startup
Sam Mallikarjunan
Head of Growth@HubSpot Labs
Sam @Mallikarjunan
4
Audience Analytics Calibration Applaud if you like any of these things
Applaud if you like
Applaudif you have a
smartphone.
I have to compete with every piece of content ever created by anyone anywhere.
20 For the rest of this time,
When youSo do you.
leave this room,
It wasn’t
Alwaysthis way.
New Technologies Come
Innovators Early Adopters Early Majority Late Majority
10%
40% 48%
1%
Laggards
1%
“The Chasm” Area under the curve represents number of customers
Our included country mapsYour great subtitle in this line
We are still only at the beginning of
the greatest global transformation of
our lives.
DISRUPTIVE INNOVATION
DISRUPTIVE INNOVATION MODEL
Disruptor
Disruptee2 31 4 5 6 7
Personal computers
Mini mills Cellular phones Community colleges
Discount retailers
Retail medical clinics
Phonographs
Mainframe and mini computers
Integrated steel mills
Fixed line telephony
Four-year colleges
Full-service department
stores Traditional doctor’s offices
Pianos
1877Edison invents the phonograph
1914$56M1905
400,000 pianos produced
1944Steinway produces caskets with excess wood
1919$158M
Not a disruptive innovation
Solve a niche problem at the low-end of a market that brings in new market participants.
1. Same price, all the time.
2. Highly variable quality.
1. Almost perfectly efficient price marketplace that adapts to supply and demand.
2. Better experience for riders and drivers with dual-ratings system.
A disruptive innovation
We live in an era of big bang disruptive innovation.
Rogers Market segments
Innovators Early Adopters Early Majority Late Majority Laggards
Trial usersVastMajority
Big bangMarket segments
Jobs-to-be-done
Step 0: Define the
User Assumption
“As an x I want to y so that I
can z.”
No one wants a ¼ inch drill bit.They want a ¼ inch hole.
The Kodak Moment Went BankruptKodak Went Bankrupt
“We don’t want to stop the disruption, we want to find a way to become the disruptors!”
F Fake it.
I Iterate.
R Retain.
S Scale-up.
T Test.
Tell people it exists now
Animated explainer video
Landing page to generate
sign ups
Button in an existing user
interface
Crowdfunding campaign
0102
0304
05St
ep 1
: Fak
e It.
Rig
ht A
way
06 07 08Wizard of Oz Horrendous
prototype. Really bad. Barely functional.
Get cash. Any cash. From
anyone. For the thing.
Eric Ries’ new book Fortified Bicycles
03Landing page to generate
sign ups
Button in an existing user
interface
04
06Wizard of Oz
“Pay no attention to the man behind the curtain."
Step 2: IterateBased on feedback
from faking it, make small changes and continue to test.
Don’t chase big deal cash.I quit HubSpot for 87 days to work at an
agency. Worst professional experience ever.
Eric Ries: “Every once in a while, startups do literally need cash to keep the lights on, but
this is more rare than founders think. Usually, they just want some extra cash to
have a little extra cushion. That's not a good enough reason to create a lot of waste
IMHO.”
Draw lines in the sand early.
Ask. For. Help.Add slide about this presentation in
there. HubSpot B&B team could do it well but expensively and slowly, I could
do it quickly but not as well, a freelancer can do it more quickly and much better.
Work to Product/Market Fit. Many have written on this amorphously defined
delineation, and there’s no single measurable point.
Step 2: Iterate
Step 2: Iterate
You can and should ask for help.
This is sort of wrong.
Marc Andreesen: A couple years ago Marc wrote the following on his blog: “…the life of any startup can be divided into two parts – before product/market fit and after product/market fit.” He goes on to write: “When you are BPMF, focus obsessively on getting to product/market fit. Do whatever is required to get to product/market fit. Including changing out people, rewriting your product, moving into a different market, telling customers no when you don’t want to, telling customers yes when you don’t want to, raising that fourth round of highly dilutive venture capital — whatever is required.”
PMF can change.
How to know when you’ve found product/market fit
Eric Ries: “If you have to ask, you haven’t.”
Scot Chilsom: “If your site goes down, pay
careful attention. If your customers start calling
and emailing in a panic, you’ve probably found
product-market fit. If the phones are silent, keep
trying.”
Sean Ellis: “40% of users say they would be very
disappointed if your product went away”
Alex Schultz: “Look at the curve, ‘percent monthly
active’ versus ‘number of days from acquisition’. If you
end up with a retention curve that is asymptotic to a
line parallel to the X-axis, you have a viable business
and you have Product/Market Fit for some
subset of a market.”
1
2
3
4
Product B Does NOT Have P/M Fit
Product A
Product A HasProduct/Market Fit
% Active
Time
Retention Curve
Product B
0%
25%
50%
75%
100%
Just as important as knowing why customers started using your product is knowing why they stopped.
Step 3
MAU vs. WAU vs. DAUDefining “Active User” properly is incredibly important.
Once you find that fit, then you have to make sure that people continue using your app.
OnboardingValue messagingSegmented New User ExperienceReactivationCreate habits
Don’t try to get your square peg customers to love your round hole product, find round hole customers or build a square peg product.
You can out grow churn for a long time.
Step 3: Retention
According to the Harvard Business School, increasing customer retention rates by 5 percent increases profits by 25 percent to 95 percent.
1. What integral trigger is the product addressing
2. What external trigger gets the user to the product
4. Is the reward fulfilling, yet leaves the
user wanting more?
5. What “bit of work” is done to increase
the like hood of returning?
3. What is the simplest behavior of anticipation of
reward
Nir Eyal’s Hook Canvas
Trigger
Investment
Reward
Action
1. Email Notification 2. Collecting lonesome,
seeking connection…Log in
Pin, Re-pin, like, comment
Communication(Tribe)
T
I
A
VR
01
02
03
04M-SPOT
Perfection is the enemy
Break apart the model that’s working, isolate the individual components of growth, and focus focus focus.
Equally important as what you’re going to do is what you’re going to omit
Once you’ve found fit, grow as fast as you can
Step
4: S
cale
05 Parents play an important role:Cash Flow Is More Important Than Your MotherGrowth Is More Important Than Your Father
Grow What You Can
+4000% Growth
+250% Growth
Focus on growing things you can
make a reasonable impact on
Jeff Bezos wasn’t the best CEO in the world because he ran a profitable business. He delivered the best shareholder returns. In the modern world, the primary engine of this is growth in enterprise value.
Profit isn't the only goal of business. You want to grow.
70% 80% 90% 100%
Disc
ount
ed ca
sh
Time
Max Cash Consumed
Investment Period
PaybackPeriod
ProfitPeriod
Step 6+: Testing
Use the same iterative
experimental process to improve your core
values and explore others.
Organized, methodical approach to
growth experimentation
Always Be Testing
historyWe live in the one of the most
of commerce.
interesting periods in the
55
new within the last decade
1000 are >70%
of businesses on the US Fortune
Thank You!