Despite the ease of product building, sustainable growth has become increasingly challenging as many traditional channels no longer deliver the same results.

In these challenging times, we explore the remaining growth opportunities. How can we achieve a balance between efficiency, profitability, and growth? Which channels are still relevant and how can they be effectively mastered in 2023?

Join us as we discuss these questions with three seasoned experts who have successfully navigated similar confusing times in the past: Gina Gotthilf, leading Latitud and renowned for her impressive tenure as the VP of Growth at Duolingo; Kieran Flanagan, a long-time SVP of Marketing at HubSpot; and Bryan Kim, Consumer GP at a16z, who held various leadership roles during Snap's hypergrowth phase up to its IPO.

We need to try to get back to like fundamentals.

And how do we actually iterate and ship fast?

We have to build products that are constantly evolving and that are constantly learning and evolving from those learnings.

The only way really to stay ahead of the curve on that consumer side is get the lightnings, keep hitting.

Third product hitting, you're a generational company.

It's like there's this big wave coming and it might hit your ship.

So like community becomes much more important.

Where the mic becomes much more important.

The new limiting factor is possibly creativity.

Despite it being easier than ever to build a product, it may actually be harder than ever to grow 1, especially sustainably, with many tried and true channels no longer working as they once did.

Paid platforms were hit with app transparency tracking, SEO is now threatened by AI chat, social graphs have moved to interest graphs, product-led growth is easier than ever to copy, and virality is just as transient, if not more transient, than before.

And those are just a few of the examples that founders are facing.

So what growth green space still exists, especially in an era of austerity?

How do you balance efficiency and profitability while still growing?

And what channels matter and how do you master them in 2023?

These are just a few of the questions we address in this episode, together with 3 people that have successfully grown companies through similarly confusing waves of the past.

First off, we have Gina Gotthelf, now leading Latitude, but perhaps most well known for her impressive reign as a VP of growth at Duolingo, growing them from 3 to 300 million users with no paid budget.

We also have Kieran Flanagan join the conversation, long time SVP of marketing at HubSpot, where he was a founding member of their international business, all the way up to HubSpot hitting over $1 billion in ARR.

And finally, we have our very own Brian Kim, partner at A16C, who also held several leadership roles at Snap, From their hypergrowth days, all the way through IPO.

All right, I won't keep you waiting any longer.

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is not directed at any investors or potential investors in any A16Z fund.

Please note that A16Z and its affiliates may also maintain investments in

What are you seeing in terms of growth that still works in

Are there white spaces that companies can tackle?

What's happening is kind of really interesting because there may be like AI is somewhat of a tailwind for like maybe 12 months or 18 months for the best people.

And then who knows after that, maybe a headwind across everything.

So I think certainly in search, I've really dug in there.

And there are lots of examples of the click-through rate decreasing and the amount of traffic you get from Google search pages decreasing.

But I still think there's like a lot of value in that.

I still think there's a lot of value in that.

What really happened with the popularity and growth of the internet is like marketing growth became much more measurable and they could have a seat at the revenue table and they could say, hi, put a dollar in here and I get $3 not here.

And the growth that's starting to happen today or where things are starting to shift is a little bit back to like this indirect causation.

These channels, like if you look at the platforms that grow and it's like short from video, TikTok, YouTube, like these kind of media channels.

If you look at where I think things will go with the evolution of AI, people will want to talk to people.

So like community becomes much more important, referral becomes much more important, where the mic becomes much more important.

All of these things are going to shift us back into like the place where we have to be okay doing things where you can't measure everything directly all the time.

And I actually don't think that's a bad thing.

I think the over index of measurements forces everyone into the middle and everything becomes like mundane and lacks creativity.

And so I think that there's like some pros and cons to actually this happening, but there's certainly a change in terms of how you are able to do your work and actually relay the value of that work to like the founder, who the founder is for the most part still going to be stuck in the binary, give me $3 for the dollar that I give you.

We're almost like going back to the origins of advertising.

Like there's that saying that says you need to hit someone 7 times before they convert and Facebook maybe changed that.

Maybe it was like 2 times and then it feels like we're sliding back in the other direction.

I think it has always been the case that people need repetition to really notice something.

And yes, more and more, there's more media, there's more for us to watch and listen to, and we're more distracted.

So I think that that becomes even more the case.

But I may be simplistic, but I don't think that much is changing.

Because to me, thinking about growth is about the framework for understanding what makes people tick, what people care about, how to reach 1 person or 1 media outlet or 1 channel, whatever it is, that will reach a lot more people in the most efficient way possible.

What are the moments in your product that people really, really care about?

Meaning like number of people who actually encounter that moment.

And if you actually make some sort of like AB test or change, you'll actually see significance as a school results on the other end, because people really care about that 1 moment.

It could be a notification, it could be a screen.

You know, we keep seeing these trends and things grow and ebb.

SEO rules are constantly changing because we're at the whim of algorithms and so we're just constantly trying to adapt.

Like at 1 point it was really trendy and cool to do ads inside the subway in New York City.

Like someone discovered that in 2012, which is funny because it feels pretty obvious.

Everyone's testing with notifications and everyone's saying there's too many and it doesn't matter.

I think all of those channels are still very relevant.

It's about finding how to actually impact how people feel and finding new ways of impacting people that are cheaper because less people are using it over and over.

So I think that that will continue to be the case and it just depends on what's the trendy channel and what are people paying attention to.

But if you think a priori like that, like how do I reach 1 that can then reach a lot or what are the things that I can modify that actually make a difference?

Then I don't think that much has changed.

I have like a slightly heretical take, so this is going to be fun.

But you know, when we talk about gross, especially I know ACTV, we're all we're all Silicon Valley and the stalwart, what have you.

But when I think about gross, it's like gross tactic, gross, you know, channels.

And even the word gross hack became very popular in that, you know, there's this prevalent theory and sort of Kieran touched on it where you can put in a dollar and get back Y, put an X dollar, get Y back.

And there became so many channels and there became so many wisdoms and tried and true tactics, whether it's SEO or ambassador program or community building where everyone's trying to learn from each other.

Gina said something interesting, is sort of how I think about it, where like moments in the product when people go, aha, like this is great.

At the end of the day, I think gross, we're sort of conflating 2 things.

Does it enable you to continue to come back?

Because growth at the end of the day is like, how many people continue to use your product?

It's like not a singular metric of like on day X, how many people showed up?

But actually, for a company that is ongoing concern, what you want to know is like how many people consistently show up and how does that grow, right?

It's a cumulative concept, which means that, you know, the fact that people come back day in, day out is probably 1 of the most important factors in assessing the growth potential and growth of it.

Which to me goes back to a little bit of product.

Where when people first come on, like we all know this, but you know, the biggest drop off, typically day 1 or day 0.

When, you know, people come on, they do onboarding, and maybe they didn't get to the aha moment quickly.

If they don't come back, then your game as a gross is like, how do I get more acquisition?

Because gross to me is also sort of a, you know, numerically almost an equation.

There's like, you know, people who showed up yesterday plus new people that you acquired minus the churn people plus the resurrected people that sort of like an equation.

And when you think about how to get the retention up, I think it all goes back to product.

Why, as founders and operators, why is there gross in your product?

And is your product constructed in a way, as Gina said, like, you know, helps people understand what your product is about when they first use it.

Can you deliver that product value again and again, consistently?

I think now we call it product-like growth, but it's honestly like a core product value and how you actually define that is 1.

And a lot of things that we're also talking about here is like distribution.

So there's like a product and the distribution side of it.

And if we think of like distribution, I think the panel is exactly right.

There are areas where it's less good now, and there are areas that are continuing to be good.

There's that saying that you never know where half of it goes.

And, you know, maybe we're going back to that.

But, you know, I think there are many other areas that continue to work well, whether it's Subway ad or Remnant TV ads or radio.

It depends on what your product is and when your intended audience is.

If you're, you know, marketing or appealing to young generation of, you know, gamers or communities or niche areas, then Reddit and Discord are actually pretty good places.

I also think, you know, ATT did kneecap a lot of the sort of paid advertising side of things.

But you know, the AI, like Kieran also talked about, can also be used for that purpose, right?

Facebook or Meta is investing heavily on, you know, AI side of it so that sometimes all you need to do is just say, hey, like I have this idea here is like the base creative.

And now they're able to like change how it looks, add different, you know, copy, like change the thing to see what works automatically at scale with AI and deliver higher value.

And that's also, you know, very promising, I think, direction that we're seeing where the efficacy of the paid side, it may also be restrained.

Yeah, I mean, I like the breakdown between there is product and there is distribution, those latter up to growth.

But maybe if we just attack this idea of building a good product, that's not a new idea, but it does feel like at least to me, maybe we are in a different era where it's easier to copy products.

And so is it just about being a first mover in an era where things are easier than ever to build.

And maybe Gina, you can speak to that because Duolingo kind of famously grew with no marketing budget.

Or very little marketing budget, and it was exactly product-led growth that resulted in that company becoming so big.

So what I think has really changed with tech is that people could say, oh, my product is really good before, but like it wasn't as easy to know whether a product is good or not good as it is now because you can actually see that in metrics in terms of, as Ryan was saying, just in terms of retention and people coming back again.

So now that defines what a good product is.

But it's not just about building a product that's good, but also the fact that with tech, we have to build products that are constantly evolving and that are constantly learning and evolving from those learnings.

But the main thing I think that like when you talk about Duolingo, what we're trying to do at Latitude now, which is my new company, the importance of not just building a great product, but understanding really clearly what your moat is.

And your moat needs to be something that makes it really hard to replicate your product.

Like so for example, if Kim Kardashian launches a shoe that's exactly just like every other shoe that exists out there the moat is Kim Kardashian because her brand and her audience and like the fact that she is an influencer she's not telling people to buy the shoe that's a moat it means that like it's the thing that makes it really hard for you to go and just do that again.

And that's the most incredible thing because of what I just said before about the iteration and the iterative practice.

Anyone at any particular moment in time, and many did try, could actually go and copy exactly what Duolingo was doing.

They in fact use the same fonts, in many cases they use the same design colors, like the same format, you can do that.

But you don't have the data and the team behind it that knows how to use that data, that is constantly learning from every single day of, you know, all of the usage that we're getting and understanding what's leading to every single decision and why we're modifying things in a particular way.

So at every moment in time, even if you mimic exactly what Duolingo is, there's no way you're going to get to the next day of Duolingo because you don't have all of that history or the knowledge of how to use that history.

So you could just spend all your time trying to like copy Duolingo every single day, but that doesn't actually get you to solve a problem for a consumer and understanding how what you're doing is actually solving a real problem, which is at the core of, as you were saying, a retentive product that people actually like.

It's definitely not as easy as it sounds.

You now are the CMO at Zapier, which I feel like actually is a great parallel to what Gina just said.

I mean, Zapier has so many, you could say clones or competitors, right?

How do you think about that differentiation and building a product and to Gina's point, like getting the right data and involving it in a way that you can stay ahead, you can have a moat.

Yeah, I think first mover advantage is useful if you can build a healthier retention curve and that retention curve helps you make that product much better over time.

And so you're just like making it much harder to compete with you.

Like Zapier's mode for some time was just they had much more expansive coverage of apps and the amount of things that you can automate with.

And then more recently, it's like, how do we integrate AI?

How do we make automation much, much easier for companies?

How can they actually do natural language within their apps?

1 of the things that's super interesting about the AI part, just going back, the distribution and then the product part and the product-led growth.

And AI is a phenomenal unlock for product-led growth because product-led growth will get naturally built into every single product because every single product will have a natural language interface.

And so like you will actually be able to onboard products and use products without actually any human intervention.

And I think that's an incredible like augmentation of like how apps work in general.

But I think the mode part is going to be much more complex.

I'm talking through the lens of B2B, not through consumer apps, but certainly for B2B, it's going to be somewhat more complicated to figure out over time because AI does commoditize things and make things much easier to replicate.

And we've seen like AI may be 1 of the few platform shifts that actually skews towards the monopolies and conglomerates versus like these individual companies who just get sucked up and their features of these existing platforms.

Like it kind of skews towards if you have distribution, you might win.

So I think AI features might be more of a retention play than an actually new acquisition play, which is like, if you build the AI features into a platform, no 1 will leave you to actually use all these different like point solutions.

So I think modes will exist in similar formats.

There may be just companies with less of them.

And so I think of all of those things in relation to this after, like, how are we touching on all of those things as we continue to grow the company?

1 thing I want to respond to what Kieran said, at Latitude, I would say the community is our mode, But the reason why the community is remote, in addition to the distribution aspect of it, is the trust building.

So trust can be a moat because that takes a while to build.

So for B2B product, I think that's also super relevant because if someone can come into the market and just like offer the same product, but you built a brand on the Zapier side that is super trustworthy.

And so people will continue to trust new features or new solutions that you put out there instead of trying to maybe try a new product.

I think that that's another aspect worth considering.

By the way, Kieran, how many times a day do you get asked if it's Zapier or Zapier?

I heard 1 of the founders say it's Zapier.

It rhymes with happier because it makes you happier.

So the main reason I joined is just I like saying the word Zaps.

Just Talking about more of the consumer side, gross and thinking about distribution, it has changed.

I think, you know, a long time ago already, Mark Zuckerberg at Meta already said, you know, it's a battle for the home screen.

And more and more, even recently, people are downloading less and less apps over time, part 1.

Part 2 is, it's harder and harder to get discovered in the App Store.

You know, App Store ranking is hard to sort of get discovery now.

So, now you have this issue of, 1, people are less willing to download brand new things.

And 2, even if they sort of kind of heard about you, it's like harder to get discovered.

So I think part 1 of the consumer side, the platforms have, for lack of a better word, maybe I can call it ossified, where there are 2 distribution platform, Google Play and Apple Store, great.

They just distribute apps and people redownload ton of apps, they retry a lot of things, but brand new things, not so much, or certainly less than before.

Now, you have this conundrum of like, okay, it's just harder to break through the noises.

And we talked a little bit about, especially Kieran talked about, maybe AI is an accelerant for retention, maybe less of an acquisition.

And that's interesting where also we have a lot of these like incumbents, right?

Like, especially in the consumer side, incumbents come with incredible moats.

So you talked about how do you stay ahead?

It's very, very, very difficult, actually.

Even if you have a clever hag, all these companies come up with incredible new consumer products, and they enter the zeitgeist.

And through entering the Zeitgeist, they're able to solve the first-order question, how do I break through the noise and get distributed initially and have more people to try it out?

If you have highly retentive product on top of that, legendary.

And all these products that we talked about did have that.

Gina, you talked about people copying down to fonts.

I've had Snapchat for 4 or 4 or 5 years and, you know, down to the font and every single UI level, yes, they copy everything.

And how do you actually fight that as a new entrant?

Especially when incumbents come bearing a lot of these already weaponaries, if you will, that have retention and data and everything.

It's hard and I think actually, and this is like a sort of difficult answer, the only way really to stay ahead of the curve on that consumer side is get the lightnings keep hitting, which is so, so, so hard.

I think getting the first hit is so hard.

So, it's sort of that innovation curve that I think is very interesting.

So for the companies that are newly entering and building new product, and we're on the side of the builders, incumbents may have all the advantage, but we want to see new products.

We want to see new hungry founder that are building for the next generation, and they're not happy with the current set of solutions.

So the only way potentially is, there are a series of things, but like step 1 boss game is like, how do you get through the distribution noise?

Step 2 boss game is, how do you get retentive product?

Step 3, and this is like the holy grail in my mind is like, how do you get that lightning to hit, continue to enter Zeitgeist?

And for that, you know, I think it's thoughtfulness, I think it's a structure of the company, I think the culture of the founders and the team of wanting to continue to put out the best and brightest work that they have continuously versus potentially resting on laurels or optimizing for things that have worked in the past and thinking that their first iteration product is what is going to bring them to the next, next, next level because They may not be because the distribution advantage of the incumbents as well as the difficulty of getting further discovery.

Is there an example of a company that you've seen execute on that hard mode really well today?

I mean, you know, 1 of the last examples I've seen, and 1 of our portfolio companies, Be Real, has done that too with certain features.

But if you think about, I'll talk about Snap since that's the name I know well, and it's been copied so many times, what have you.

The first hit 1 may think is the disappearing images.

That people thought of images as something to keep on your phone it's like for recording and for keepsakes you turned that into disappearing thing which made the medium itself a message communication method that's revolutionary very interesting you know sexting was the first use case but it like catapulted the company to new heights.

Now then, the kicker is they then started to add stories.

Right, stories of these disappearing photos like linked together that shows you a day in time in your life in a passive way, but also goes away, revolutionary in that sense, then that to me is a second Zeitgeist hit.

Which by the way, what a great example of something being copied too, right?

Like no dig on LinkedIn, but like everyone has stories now.

So you know, it's a medium and like a thing that worked really, really well and potentially even burst like the short video type thing, that's a trend.

So to think about the second innovation, that's like a huge innovation.

Third also is, you know, they did a rest there.

It was like, okay, we are seeing more and more people abandon the front, result of the front facing camera.

Well, they don't like what they look like.

Well, let's add dog ears on people's face.

Let's add like rainbow pukes on people's face.

And again, that's another thing, Steph, where everyone copies, like everyone has lens now.

TikTok, you know, puking rainbows, blue eyes, what have you.

But these augmented reality effects are now prevalent in consumer products.

So this is 1 example where I think each subsequent hits have essentially catapulted the company to new heights.

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Growth vs Efficiency: Can You Have Both?