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Andrew Chen @andrewchen General Partner at a16z, previously Uber, startups. 🇹🇼-born, Seattle-raised. Plus one: @briannekimmel Jan. 12, 2019 4 min read

👇Thread on the perfect "Growth Hack." Finding a "growth hack" is generally associated with small/clever tricks that move growth metrics quickly. "Turn your buttons orange and you'll get a +5% the next day." However, sometime's they are extremely powerful and make the company

1/ The problem with "turn your buttons orange" or "make your signup form shorter" is that, on one hand, it might work and might be true. On the other hand, it's often just a small optimization to your funnel. And one that everyone can quickly copy

2/ Years ago, I wrote about the "Law of Shitty Clickthroughs" which states that every growth tactic and channel eventually decays in performance over time. The first banner ads had 70%+ CTRs, and now they are <0.1%. Yikes. Old essay here:  https://andrewchen.co/the-law-of-shitty-clickthroughs/ …

3/ The problems with the tips/tricks school of growth hacking is that they lead to unsustainable advantages. And if you have a big team and big product, perhaps it's useful to pull together these +5% type lifts, especially if you can do it in a critical path "loop" like invites

4/ On the other hand, when a new growth tactic is combined with a unique product value prop, then the only folks who can cause the tactic to decay tends to be other direct competitors. That's a much smaller group

5/ An important B2B example is Dropbox- they were one of the first to adopt a referral program where you give/get disk space:  https://www.slideshare.net/gueste94e4c/dropbox-startup-lessons-learned-3836587/31-Trailing_30_days_Apr_2010 …. The give/get programs at Uber, Airbnb, and many others are direct descendents

6/ On the other hand, it's also just a naturally viral product - people share folders with each other and end up inviting their coworkers. This also generated millions of users. Which one ended up being a more sustainable program in the long-term? The latter, of course

7/ Spreading Dropbox by using Dropbox via shared folders aligns the growth tactic with the value proposition. So the users that come in activate better, engage more, and are more viral. And they don't get bored of the tactic, since it's not gimmicky the way that give/get can be

8/ In my recent deck on areas I'm interested in investing in at a16z, I talk about some other growth tactics that tightly align the value with the acquisition mechanism. Here's the deck:  https://andrewchen.co/consumer-startups-at-a16z/ …

9/ One really big opportunity here is in video. The audience for video is really really big - 1 billion+ MAUs! It used to take a video 5 years to get to 3B views, now the latest, Despacito, only takes a year -

10/ As a result of this , one of the key durable growth tactics comes from being "video-native" - being a product that naturally generates video through usage. Like esports! Which is why esports has gotten so big in the previous years. 100M+ live viewers, similar to Super Bowl

11/ If you are a "video-native" product, then similar to Dropbox's folder sharing, it's a durable key growth hack that can last a long time. And if you build a community that likes to stream/share video, it provides proprietary growth

12/ Is this a "growth hack" or should it have a different term, since it's sort of a more foundational thing? I don't have a strong preference, and sometimes things start looking more like a trick and then become foundational. So who knows? But this is what we're all looking for.

13/ Contrast this to all the dumb random growth tips/tricks that I read about online, and you'll see this is a fundamentally stronger, order of magnitude more important type of growth tactic. It's something that can make the business happen

14/ Sometimes these growth hacks are big, but are just stepping stones. Airbnb's integration into Craigslist fits into this example- everything I wrote about in this original "Growth Hacker is the new VP Marketing" essay is longer a big deal for them:  https://andrewchen.co/how-to-be-a-growth-hacker-an-airbnbcraigslist-case-study/ …

15/ The other obvious example is that YouTube initially grew as embedded video widgets (remember those??) on MySpace. Pinterest and Spotify were dependent on Facebook's Open Graph when that was a thing, but moved to SEO/virality and paid ads over time

16/ This is a bit of a rant against the "tips and tricks" culture of a lot of online marketing . I encourage y'all to think bigger - how to create proprietary growth, how to make sure it's durable and scales, and not just the color of buttons!

17/ PS. linked this earlier, but this deck has a deeper POV on how to think about human motivations, tech change, and spotting growth hacks to propel big startup opportunites:  https://andrewchen.co/consumer-startups-at-a16z/ …


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