How to Grow and Scale Your Startup

An article we liked from Thought Leader Anu Hariharan of Y Combinator with special contributions from Gustaf Alstromer:

How to Set Up, Hire and Scale a Growth Strategy and Team

ADVICE FROM 25 PREEMINENT GROWTH EXPERTS AT TOP STARTUPS

"Growth hacks," like Hotmail's inclusion of a signup link in its user's default email signature, can be extremely helpful in driving viral growth early in a product's path to product market fit (PMF). However, sustaining long-term growth and reaching hundreds of millions of users requires a scientific approach to growth. In fact, growth experts resoundingly say that "growth hacking" isn't in their vocabulary or something they relate to their work. "Hacking" implies a haphazard / gut-driven approach, and the reality is quite the opposite. Startups that have seen amazing growth have developed teams and processes that are intentional, exceedingly metrics-driven, and thrive on experimentation.

To foster a scientific approach to growth, we've recently seen many companies break away from a strictly functional organizational design (with product, engineering, marketing, etc.) to create a cross-functional growth team. Facebook is, by all accounts, the pioneer of the growth team. Its first growth team was formed a decade ago with 3 people whose impact was immediately evident. Facebook launched the growth team when it had ~50 million monthly active users (with roughly flat month-on-month growth). The growth team and its surrounding program became a key driver of Facebook's rapid expansion to 2 billion monthly active users today, as well as the evolution of the core Facebook product. Following Facebook's lead, most successful consumer startups have created growth teams. Interestingly, these teams have converged around many of the same best practices.

The Y Combinator Continuity team gets a lot of questions from founders on formalizing growth. Everyone is eager to understand when to hire their first dedicated growth product manager (PM), how to structure a growth team, and how to scale it over time.

So, we spent time with 25 growth experts, who have worked at companies (including Facebook, Airbnb, Uber, Stitch Fix, Square, Slack and Instagram -- full list below), to identify best practices for establishing a growth program.

When to Invest in Growth

A great way to waste money, resources, and jeopardize the future of your company is to invest in a growth program before you've proven you can retain customers. In other words, it's best not to hire a full-fledged growth team (defined in "Building Your Growth Team" section) to put major ad dollars into growth until you've ensured you don't have a "leaky bucket" problem. If you you determine with the process outlined in this section that you haven't yet nailed retention, you can apply a growth approach to retention. For example, Stitch Fix hired a retention focused PM to run experiments to improve retention before they invested in new customer acquisition

CHECK YOUR RETENTION

Start with this retention checklist to help determine if you have good retention, which you should be able to tackle with your...

Read the rest of this article at ycombinator.com...

Thanks for this article excerpt to Anu Hariharan at Y Combinator.

Photo by Monstera

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