One of the key skills in Venture Capital is not just being able to pick out the highest potential founders, it’s also being able to add value after the investment is made. Everyone in the field is looking to translate their past experiences and insights into a value-creating superpower that portfolio founders can tap into.
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One of the key skills in Venture Capital is not just being able to pick out the highest potential founders, it’s also being able to add value after the investment is made. Everyone in the field is looking to translate their past experiences and insights into a value-creating superpower that portfolio founders can tap into.
In my case, I figured that something might be Go-to-Market support. After an undergrad in Marketing, I started my career leading B2B Sales & Growth Marketing at a couple of different startups as a very early employee. There, I had to figure out how to build a repeatable and scalable sales process. I went through the ups and downs of figuring out product-market fit, building a quality top-of-funnel, refining messaging, testing various channel tactics, implementing a CRM and putting in place predictable sales processes (among other things). So my head immediately went to lending some of this experience to the founders we work with today, building off a point I made in a previous post, where I talked about how my non-linear path to VC investing has proven to be more valuable than I initially thought.
But it’s been 10+ years since that undergrad and 5+ years since I’ve worked in any kind of Marketing or Sales role. So, coming back to a world I once knew, that has since evolved in the sophistication of its best practices, has been not only eye-opening, but humbling.
That’s why, I recently decided to go back to the proverbial classroom and learn anew about sales, marketing, go-to-market and customer engagement. One of the ways I did that was by reading a handful of growth marketing books found on many startup bestseller lists.
To be more specific, I read these 4 books over the last little while (ranked in order of enjoyment):
My issue with business books (and non-fiction) in general, is that you can often distill 300 pages of text into a blog-post worth of key insights. So that’s what I aim to do here — to save a bit of time for those who don’t want to comb through all the additional prose. That said, sections of these are pretty enjoyable reads so please don’t let me be the arbiter of what’s on your nightstand.
In any case, here are some key take-aways from these books:
“Blitzscaling” is a growth strategy that sacrifices efficiency (and much else) in the name of acquiring customers quickly. While this “first-scaler advantage” can be both an offensive and defensive competitive strategy, it is one that can put unnecessary and undue pressure on a nascent business by growing too fast, before the business is set up to handle it. This out-of-control growth, fuelled in part by heaps of venture capital investment, puts the business at increased risk of burning out quickly if the blitz is unsustainable. Just like a football team’s defensive coordinator wouldn’t call an all-out-blitz on every play against every opposing offence, blitzscaling isn’t for every startup or useful all of the time.
So when to blitzscale? According to the book, these are the factors to consider:
A final word of caution — just because you can blitzscale doesn’t mean that you should
As such, here are a few early warning signs over time of when to stop:
If blitzscaling isn’t for you, worry not — there are other growth strategies to take your company from zero to hero. But first, you need to figure out where you’re going.
Just like you wouldn’t set sail into a vast ocean without a compass, navigating the choppy waters of startup competition without direction puts you equally at risk of drowning while lost out at sea.
One theme that is pretty consistent across all these books, is the idea of establishing (early on) one key metric that will drive all growth-related experimentation and direction — ie. a North Star Metric (NSM).
Once your North Star is identified, you can reverse engineer your organization’s unique growth “formula” by using data analysis to determine what variables contribute to the elasticity of your NSM. Usually, they will tie directly to a user’s core value experience and an “aha moment” with the product. These variables will become your core metrics to track.
One caveat here is that it is important to be emotionally detached in pursuit of your North Star. Be obsessed with the underlying business problem, not the metric itself.
Now that the variables are defined, here comes the fun part … experimentation.
Most people think that to be successful at growth marketing, you need to be good at selling. Really, you need to be good at experimenting.
Experimentation is very useful but can be both time consuming and costly if not run efficiently. The startups that reach product-market fit (PMF) and venture scale the fastest are often ones that can apply the rigorous scientific method to growth marketing. That is largely what “Hacking Growth” is about but it is also referenced in the other texts as well.
Here’s a summary of some of the feedback there:
For more info on this, Chapter 4 of Hacking Growth highlights the play-by-play of how to run a systematic Growth Hacking process down to what meetings to run and their agendas.
One key factor highlighted is that while growth experimentation should reside in the DNA of the entire startup team, it does help to create a specific kind of “Growth Team” task force who are solely focused on this issue.
A Growth team would normally involve a cross-functional array of people from Marketing, Customer Service, Product, Engineering, as well as data analysts and other subject-matter specialists that may be relevant. A “Lead” is usually assigned and reports directly to the CEO. As the team is cross-functional and tactical, the lead doesn’t need to be the most senior person but senior enough to be able to provide clearance on administrative hurdles. Growth teams are also sometimes split into subgroup task forces with each one focused on a different part of the user experience (activation, engagement, retention, etc.)
Regardless how you build the growth team, one golden rule exists: Growth hacking can NEVER be outsourced.
Despite all the benefits of continuous experimentation, it’s easy to see how one can begin to go down a rabbit hole — at some point, there are diminishing returns. Once again, it becomes important to focus. Better to do few things really well than many things poorly.
Most startups don’t have the bandwidth or budget to test every possible hypothesis and pursue all avenues. So when you start to see certain channels or marketing actions working better than others, it’s critical to pull the plug on the less-performing experiments and double-down on what’s working.
Traction frames this idea into a “Bullseye framework” for figuring out traction channels — where the idea is to work from the outside-in and gradually focus efforts and resources on what’s working.
Each book will highlight tactics or mottos related to fast growth — things like:
But with great growth comes great responsibility. That is why each book also highlights the importance of understanding the trade-offs being made (on quality, readiness, reputation, cost, etc.). Be aware of the risks you’re taking — if they’re not calculated, you probably shouldn’t take them.
Notwithstanding what has been mentioned to this point, in the startup world, you can run the best experiments, nail down distribution and channels, hire the right people but if you build a product that nobody wants, none of it will matter.
That is why, an important element of growth marketing (and consistently emphasized across all these books) is ensuring you’re building a customer-driven and value-creating product. The recommendation is for startup marketers to follow the 50/50 rule — spend 50% of your time focused on product and 50% on building customer traction. Doing these in parallel is critical to success.
What you want is to build a product that is MUST HAVE and can generate a 10X improvement over the status quo.
How do you do that? Here are a few tips pulled from these playbooks:
A pretty common theme throughout these books has to do with the startup lifecycle and how, strategies and tactics employed today may not work tomorrow. Sometimes it’s about “Crossing the chasm” from early adopters to the early majority, or focusing growth efforts on Awareness then Activation then Engagement then Retention, or evolving past initial marketing channels once they become saturated, costly and ineffective.
In any case, as the startup evolves, so must its various growth marketing approaches.
There is so much literature out there on marketing for startups because it is a vast and complex topic. While this post only scratches the surface, hopefully it provides a streamlined literature review from a handful of well-known marketing books.
If you have other tips/tricks to share with founders, I’m putting together a Growth Marketing toolkit and would love to hear from you!
