Lenny's Podcast: Product | Career | Growth
00:50:59 · Elena Verna
[00:50:59] S0: seven. We've talked about this at least a little bit, in our last podcast too, but, I see this as a question that comes up all the time and something that people are afraid of, to invest, which is a mistake. Every single company starts with their growth efforts focused either on product led growth. Hey, I'm going to have everything being done self serve. Or on sales and marketing, I'm going to have sales team and then they're going to have marketing team and they're going to do all of the work and my product is just going to create the functionality. And that's good and fine for a while, depending on how long that while is. But not overlaying every single way that you can grow through product, through marketing, and through sales as an evolution is a huge mistake that a lot of growth teams fail to iterate on and innovate on. The way that I'd best be comparing it is if product has a product market fit, which is great, that product market fit is not going to last that product forever. They're always going to have to have a second horizon. They're always going to have to have a product market fit expansion efforts in order to continue to grab as many people and solve as many people's problems as possible and increasing their TAM. Well, the same comes with growth. If you have a growth model that works for you, that's wonderful. Good for you. Optimize it, grow it, scale it, create a team that will be nurturing it and that will be amplifying it. But you're going to need to evolve it. And that evolution needs to come through overlaying other growth models on top of it. So, A, you are diversified away from just one growth model failing because a lot of times you're going to get into a situation of law. I love Andrew Chen's article here. It's called A Law of Shitty Click Throughs, where you just, if you over optimize the same thing over and over again, it's just, it has minimal returns. And some growth models have very limited time span. Some of them are huge, some can grow for like sharing loop at Dropbox. It's seventeen years in the making and it's still firing. Good for it. Like, that's amazing. But that's very much an anomaly. Most of growth loops spin out their ability to produce meaningful results for you within the first five to six to seven years. So, continuously overlaying those different growth models.
00:53:27 · Elena Verna, Lenny Rachitsky
And what I'm specifically talking about is product led growth, marketing led growth, sales led growth, and introducing it into this ecosystem constantly is what really separates companies that can continue growing for long periods of times versus the ones that can see a really big blip, potentially even unicorn type of growth rates of 70, 80, whatever plus percent, and then it starts to slow down. And don't wait till that slowdown happens. You need to really start thinking about different ways that you can attract people to grow so you are not leaving a gap in the market that somebody else can enter and own, as opposed to you playing in every way and where you can interact with your customer. [00:54:11] S1: The way I think about this is like the S curves of every growth model and growth lever, right? Eventually it'll help and then slow down and so you wanna find the next S curve on things that'll grow your business.
00:54:11 · Lenny Rachitsky, Elena Verna
[00:54:11] S1: The way I think about this is like the S curves of every growth model and growth lever, right? Eventually it'll help and then slow down and so you wanna find the next S curve on things that'll grow your business. [00:54:24] S0: Yes, absolutely. Way that I see it often is that especially when growth teams, they hit a really big result out of some initiative, they just like keep trying to focus on that over and over again. And sometimes that focus is warranted. Like I said, our sharing loop at Dropbox has its own growth team against it. Great. But at the same time, that's not warranted for all of the... Or you need to realize that there's no more juice to squeeze out of this thing, and then you need to go and you need to move on. Which actually brings me to my, like a little bit of a next thing too, is you'd need to do it every eighteen months because a lot of them are going to fail. And every five years or so, you for sure need a new channel, new growth loops, new tactics, new engines, so to speak, to power your growth engine, whether it's overlaying sales on top of self serve, whether you're doing a lot of, let's say, virality right now in terms of acquisition and you're going into marketing a lot heavier. But every five years, something big has to start taking a big portion of your volume. And for that, every eighteen years, you need to introduce something Sorry. Yeah. For every eighteen months, you need to introduce something new in order for it to, continue evolving.
00:54:24 · Elena Verna, Lenny Rachitsky
[00:54:24] S0: Yes, absolutely. Way that I see it often is that especially when growth teams, they hit a really big result out of some initiative, they just like keep trying to focus on that over and over again. And sometimes that focus is warranted. Like I said, our sharing loop at Dropbox has its own growth team against it. Great. But at the same time, that's not warranted for all of the... Or you need to realize that there's no more juice to squeeze out of this thing, and then you need to go and you need to move on. Which actually brings me to my, like a little bit of a next thing too, is you'd need to do it every eighteen months because a lot of them are going to fail. And every five years or so, you for sure need a new channel, new growth loops, new tactics, new engines, so to speak, to power your growth engine, whether it's overlaying sales on top of self serve, whether you're doing a lot of, let's say, virality right now in terms of acquisition and you're going into marketing a lot heavier. But every five years, something big has to start taking a big portion of your volume. And for that, every eighteen years, you need to introduce something Sorry. Yeah. For every eighteen months, you need to introduce something new in order for it to, continue evolving. [00:55:49] S1: And it was that number eight of the list we're going through or that's like a bonus piece of advice? [00:55:54] S0: No. That's just a bonus piece
00:55:54 · Elena Verna, Lenny Rachitsky
[00:55:54] S0: No. That's just a bonus piece [00:55:55] S1: of advice. Okay. Cool. Okay, got it. And so the advice here essentially is you'll find something that is helping you grow, assume that will slow down at some point, start thinking about other levers and growth models to layer on top of that. Something I've seen, let me know if you agree, is usually there's gonna be like one lever that is most of your growth for a long, long time. And so all other things are not gonna be as big, but they are still important.
00:56:19 · Elena Verna
[00:56:19] S0: Yeah. So the way I think about it is I try to focus 2020% to 25% of growth teams' time annually, not every given sprint or not every given quarter, but annually, to introduce a new growth loop, or to introduce a new channel, or to introduce something new that can potentially bring us additional bump to our growth engine. I know that a lot of it is going to fail. None of it is gold on any growth metrics because you cannot goal it immediately, let's say, on monetization or immediately on acquisition. You're just gonna cut it at its knees immediately if you're not gonna let it evolve into something that can be monetized, that can be responsible for So like example on Miroverse, which is a user generated content library of all of the Miro boards that people create, it took us probably eighteen months until we started putting metrics, expectations on it. Before that, it was a thing that we were testing. And it was being used by a lot of people, but we're like, we don't even know exactly quite how this is gonna fit all together. And then it started taking off as both engagement engine as well as acquisition engine. But it's important to constantly give your team room to try those new ideas. Otherwise, you're going to find yourself that your growth loops and your growth engine is slowing down and you don't have time to find that second horizon. And that is the worst situation to be in. That's where growth starts to slow down and to recover out of that is impossible because you need revenue. You need revenue, you need revenue, you need revenue. And these growth loops on average take six months, a year, a year and a half to start producing even visible revenue. So that's why you need to start layering it very soon into your initiatives.