Insights from the World’s Fastest Growing Startups
When we launched GrowthHackers.com back in late September we had a notion of doing “growth teardowns” of the fastest growing startups. We wanted to answer the question that everyone on the outside of these rocketships wanted to know the answer to: “How did they grow so fast?”So we set to work doing deep research dives on companies like Uber, Snapchat, Yelp, LinkedIn, HubSpot, Evernote and more.
By scouring the Web for interviews, videos, past profiles and more, we pulled insight from dozens of sources for each case study. Based on our research we were able to piece together what made these companies so successful—and in the process reverse engineer their growth engine.While we certainly didn’t get everything 100% right, we received overwhelmingly positive feedback that the case studies were some of the most detailed accounts of these companies’ growth engines ever created.
So now, with ten growth studies under my belt, I want to share ten things I’ve learned from these incredibly successful companies, to hopefully inspire you and shape your thinking when it comes to startup growth.
If you want to read all ten case studies, we’ve decided to release them as an ebook, (amazon associates link) If you’d like to read all ten you can do so by downloading it there.
Lesson 1: Growth is Nothing Without the Product
You’ve heard plenty about product/market fit, and for good reason. While each of the ten companies we profiled have unique growth engines—they all have one thing in common: a ‘must-have’ product experience that creates loyal and happy customers who form the base of their success and the fuel for their growth.
While some, like LinkedIn, needed to grow to critical mass to become a ‘must-have’ and others started out that way (like Evernote), each company fills a critical gap that previously existed for their users.
Marc Andreessen has been quoted as saying (and I’m paraphrasing here) companies fail for two main reasons—trying to grow when they shouldn’t, or being too timid when they should. Product is the foundation of growth. Without it sustainable growth is impossible.
Lesson 2: Growth is Never ‘Done’
All of these companies have a relentless focus on growth. It’s not just something they pay lip service to. They put headcount, resources and effort into growth. LinkedIn may be the most prolific of the bunch. With more than a decade focused on continual growth, they’ve inspired me to realize that growth is never, ever done.
Ten years in and LinkedIn is still innovating on their growth engine. They have their share of misses, but the passion to find the next growth lever, and the next, and the next, is inspiring.
Lesson 3: Growth is not marketing. Marketing is not growth.
One of the big takeaways with all of these companies is that none of them had a traditional marketing playbook. You won’t read about how they were masters of paid search or email marketing. Sure, many of them eventually added those competencies, but they weren’t what unlocked transformative and sustainable growth.
Instead you’ll see that these companies had specific playbooks to drive growth—many that included marketing—but more often relied on the product for their biggest growth opportunities.
These levers, like making the white Square card reader stand in stark contrast to black iPhones, or Evernote redesigning the entire product to meet a new appstore launch, are outside the realm of traditional marketers. The marketing teams don’t have this kind of leverage in companies.
It takes real growth teams across engineering, product, and yes, marketing, to design the growth programs that really move the needle. Contrast this approach to the massive paid ad budgets of companies like Groupon, which were ultimately unsustainable.
Lesson 4: Doing what everyone else is doing is the wrong strategy.
None of these breakout companies did it the same way that the incumbents grew in their vertical or type of business. They all picked their own path, often leaving people wondering what they were thinking. HubSpot charged for upfront onboarding, which people thought was a mistake. Turns out it’s a huge piece of their massive retention success.
Yelp stayed away from paying for reviews and wooing food critics, instead focusing 100% on the community above all else. In a landscape where Citysearch and other behemoths catered to businesses and paid for reviews, this seemed almost foolish at the time.
Lesson 5: Don’t try to boil the ocean.
In Startups Always Have a Chasm to Cross, Andy Rachleff, co-founder of Wealthfront, highlights the critical importance of being laser-focused on a niche early to achieve growth. All of the companies I studied did this in one way or another. Whether it was Snapchat with college and high school kids,Square with small businesses, or Belly with retail SMBs in the city of Chicago, they all realized that putting more wood behind fewer arrows would result in greater success over time.
Lesson 6: Growth hacks have nothing to do with short-term tactics.
The term growth hacking is in the hype cycle whitewash, as journos and others have misappropriated its meaning and assigned it to nearly every known digital marketing tactic. But while people still obsess over AirBnB and Craigslist, each of these companies found a unique insight or ‘hack’ to help grow their business. These aren’t hacks like RapGenius’s dumb link spam, these are really unique and thoughtful insights that lead to lasting growth.
Their unique way of looking at things is what let them find their growth engines without investing tons of money into traditional marketing. HubSpot was one of the first to realize that building free tools could create massive inbound demand—far and above traditional social and content strategies.
Uber and Belly both designed growth strategies which localized network effects to help solve marketplace liquidity challenges early on to grow. LinkedIn’s double viral loop is the thing of growth legend.
Lesson 7: Do things that don’t scale, build things that do.
Paul Graham’s advice to startups is to “do things that don’t scale” to get initial traction. This means things like concierging new customers, and taking the time out to visit and talk with users, etc. In each of these companies’ cases they followed that advice in one way or another.
Evernote realized that appstore launches were huge momentum points for the company and worked feverishly around platform announcements to be ready with new features so they’d be featured on stage or in the appstore at every launch. Certainly not scalable, certainly very powerful for distribution.
At the same time these companies built systems and processes that could scale. For instance Uber has a city roll out playbook that they use to launch a new city. And we’re not talking just the PR plan to announce Uber in a new metro. Uber has planning and early seeding teams on both the driver and consumer side. They developed a playbook that works in their test markets early on and use those best practices to create a repeatable way to successfully launch new cities.
Lesson 8: There are analytics and then there are insights.
Lots of people track analytics. Plenty of dashboards, plenty of vanity metrics. Avinash Kaushik calls it ‘data puking.’ Lots of numbers, little insight. All of these successful companies uncovered real insights that drove growth.
Upworthy put the science into virality with their now-famous 25 headline exercise and relentless testing focus. Almost all of these companies have a similar approach analytics. They don’t just report on numbers, they find growth opportunities from the insights within the numbers and apply them to grow the business.
Lesson 9: Combining multiple growth engines can lead to faster growth.
Companies like GitHub have shown that combining more than one growth engine together creates outsized results. GitHub is a social network, a marketplace for code, a publishing platform and oh-by-the-way addresses a major workflow pain point.
It has an asset—all the code—a network, and more. These things all work together to drive massive adoption and growth.
Now GitHub is part of many developers’ workflows. It’s simply part of the stack, making its business incredibly defensible. Yelp has the community—a network—and an asset—the reviews. LinkedIn, similar story. Multiple engines can drive growth forward.
Lesson 10: There are no silver bullets.
None of these companies have a single silver bullet. They didn’t just explode into millions of users and downloads. Even the products that we think of as “magical” use meticulous growth strategies to drive adoption and growth.
While in retrospect it seems like word of mouth carried them, a deeper look under the hood reveals that they were all engineered to grow in one way or another. Growth is never left to chance.
Companies may catch lightning in a bottle, but it’s often always because they were prepared and working hard to align themselves to do so. Trying to find that silver bullet is fruitless and can be exceptionally costly.
Lesson 11: Growth is a team sport.
A bonus one! The best companies are growth organizations at their core. It’s in their DNA. From the top to the bottom everyone makes growth the imperative. There is no lone growth hacker—everyone at the best growth companies knows they have a role to play in driving growth. Whether it’s legal creating contracts that are easy to execute more quickly, or engineering optimizing the code base for search optimization, everyone makes growth a priority.
In the best growth organizations, sales and marketing aren’t firewalled from product, and engineering doesn’t consider marketing efforts spam. All of these teams work together to unlock growth and tap into these massive opportunities.
After reading so much on these companies trying to narrow down to just a handful of core principles is incredibly challenging; but these insights are what stood out to me in the course of reviewing everything we created for this new ebook.
Startup Growth Engines: How Today’s Fastest Growing Startups Unlock Extraordinary Growth (amazon associates link) is more than 160 pages filled with the research, quotes, and insights packed into each case study. I hope it becomes a valuable part of your library—especially as a growth leader or entrepreneur looking for breakthrough growth.
First published at medium.com.