Sean Ellis - Startup Growth Engines: Case Studies of How Today’s Most Successful Startups Unlock Extraordinary Growth

Growth Engines: Case Studies of How Todays Most Successful Startups Have Unlocked Extraordinary Growth

By Sean Ellis, Morgan Brown

& The GrowthHackers.com Team

All rights reserved. This book or any portion thereof may not be reproduced or used in any manner whatsoever without the express written permission of the publisher except for the use of brief quotations in a book review.

Printed in the United States of America.

First Printing, 2014

www.unlockinggrowth.com

In 2010, I coined the term growth hacker to define a new type of marketer leading a new type of growth-oriented marketing organization for startups. After five years of working with some of the fastest growing companies on the Websuch as Dropbox, Eventbrite and Lookout it was clear that the most successful companies today are ones who are able to effectively scale their user base, revenue and ultimately value in a way that is fundamentally different from their competitors and that creates outsized audiences and value in the process.

In my experience, the growth of these companies did not come from traditional marketing. In fact many jettisoned their Vice Presidents of Marketing in favor of cross-functional growth teams that included individuals from engineering, product, sales, and marketing. Growth came from product innovations, unique acquisition channels that their competition hadnt considered, and rigorous optimization driven by analytics and a deep understanding of their customers.

The result has been nothing short of astronomical. The new growth organizations have created billions of dollars in value in incredibly short time frames. These companies have acquired massive audiencesin the tens and hundreds of millions of peoplein the process. The punchline? Most of it has been accomplished with very little traditional paid advertising and marketing. Instead, these companies use virality, freemium business models, untapped acquisition channels, unique hardware and software design, and memorable experiences that when combined, create a flywheel of growth that catapults these companies past competitors who stick to traditional marketing methods.

So how do they do it? Whats the formula for growth today? Thats the question weve attempted to answer by tearing down the growth engines of the companies profiled in this ebook. After months of study, hundreds of documents and articles researched, and interviews teased out from conferences, articles, videos and more; weve assembled arguably the most detailed breakdowns on how successful companies are growing today.

From software as a service, to social networks, mobile applications, marketplaces and business-to-business products, weve attempted to examine a cross-section of the top performers in these categories to understand their approach to growth, what makes them different, and what makes them successful. For each of the case studies contained, weve attempted to identify two main elements of growth: what helped the business gain early traction, and what is fueling the business today.

While each of these companies traveled different paths to their current success, they share many things in common. The first, and most critical shared element is that they all have a highly valuable product that has become essential in their customers lives. In other words, theyve all built must-have products or built a large network to become must-have. This central fact cannot be understated. Without their must-have product experiences it is almost guaranteed that you would not be reading about them or even know who they are or were.

In the past underwhelming products could survive and thrive merely on distribution alone. A bad product, backed by a large television campaign and retail distribution, could find growth and profits for the company, regardless of quality. This is no longer the case. Today, mediocre products can still be launched in this way, but their longevity and returns quickly crash as word of mouth spreads and demand dries up faster than ever before.

Beyond the shared must-have nature of their products, each of these companies has used a deep understanding of their customer and a rigorous analytical approach to growth that enables them to be hyper-efficient in acquiring, retaining, and monetizing their customers. These insights yield unique customer acquisition strategies that highlight this new approach to thinking about growth.

As you read these case studies youll likely notice these similarities, and more. In fact, you may walk away from this ebook thinking that these companies share the same DNA. You wouldnt be far off. All of these companies make growth a priority across the companyits part of who they are. Growth is not just a concern of sales and marketing, but of product, engineering and support too. It is this organization-wide commitment to growth that ultimately sets these companies apart.

In these growth-oriented businesses, the new marketers (the growth hackers I called for nearly four years ago) are leading cross-functional growth teams, are steeped in data and creativity, scientific thinking, and are immersed in the product as much as the promotion. They are leading the charge to a new form of marketingwhere marketing must go for it to be effective in todays environment, competing against companies playing by an entirely new set of rules.

What to make of all of this? If youre a marketer, the imperative is clear. Your job is to move beyond traditional promotion and get deeply integrated with your product and engineering teams to find the best growth levers for your businessmany of which are not currently in your hands or under your control. If youre an entrepreneur or business executive the charge is equally clear: you must remove the walls between your sales and marketing organization and product development. You must move quickly to an integrated growth organization and foster a culture that prioritizes growth across the company.

This is an exciting time for marketers and executives who grasp this new way of growing and embrace the opportunity. As a marketer and now an executive myself, Ive seen just how incredibly game changing this new approach can be. I still believe very much in the value of marketing and the role that marketers play in creating value for companies.

This is not a call for an end to marketing; in fact it is just the opposite. This is a rallying cry to all marketers who wish to drive real results, grow real businesses, and be evaluated and compensated on the growth they produce. Growth hacking is not anti-marketing, it is the evolution of marketing, it is pro-growth.

All of this research into these new ways of marketing acts as the foundation to the upcoming book that I am co-authoring with Morgan Brown: Unlocking Growth, How the New Rules of Marketing are Changing How Companies Grow. In the book were breaking down the specific elements of each of these growth engines, and diving deep into the tactics and organizational imperatives needed to find sustainable growth. If youd like to be notified when the book launches, and get access to additional content and benefits, please sign up at unlockinggrowth.com.

We hope you find these case studies as illuminating as we have.

Sean Ellis

These case studies are part of the research effort that comprises the strategies and tactics for how to unlock growth for new companies and products in our upcoming book. Unlocking Growth: How the New Rules of Marketing are Changing How Companies Grow is a detailed look at what it takes to grow your business outside of the traditional marketing playbook.

Based on dozens of case studies just like these, plus more than 30 years of combined experience of helping startups grow from mere ideas to fully-fledged companies, Unlocking Growth details what it takes to grow in a hyper-competitive market, and how anyone at any level of an organization can apply these new rules to help their company unlock growth and find outsized gains while doing so.