- Dan Hockenmeyer advises startups on growth and often talks them out of doing things they want to do, as most gains in growth come from a few key tactics.
- Companies should focus on retention before heavy acquisition, as unsustainable acquisition without strong retention can be problematic.
- When working with a series B consumer company, it is important to start with a traditional spreadsheet model that analyzes channels of acquisition, conversion rates, retention, and monetization.
- A smart analytical generalist can create this spreadsheet and analyze the data to identify areas of leverage.
- During an interview, the ability to understand how changes impact the overall output of a business and a strategic understanding of where to focus are important qualities to look for.
- Airbnb's success was largely due to its great product experience, even though there were initial friction points in the user flow.
- Both building a great product and being great at growth are important, and the two are tied together. A good product will have natural adoption, but the growth team's role is to ensure that growth doesn't slow down by identifying opportunities for improvement.
- Optimizing basic features like signup and login can have a significant impact on revenue, as seen in Airbnb's case.

- The speaker discusses how making small changes to improve user experience can have a significant impact on revenue.
- They mention how Facebook's growth team recognized the importance of accelerating growth and the potential impact it can have.
- The speaker also highlights the negative aspects of the growth hacking mentality and the need for a more thoughtful approach.
- They discuss the importance of experimentation and A/B testing in product development.
- The speaker advises startups to focus on instrumenting their site correctly before implementing an experiment framework.
- They recommend using third-party tools for experimentation and caution against building it yourself unless you have the resources to maintain it.
- The speaker emphasizes the importance of measuring retention and understanding user acquisition sources.
- They also mention the need to identify early proxies for retention and satisfaction in order to optimize these metrics.
- An example is given of Thumbtack using the number of quotes a consumer receives as a proxy for successful hires.

- The health of a market is measured by the percentage of customer requests receiving a sufficient number of quotes.
- Many companies understand the concept of A-B testing but struggle to fully implement it.
- Building a culture around experimentation is important for successful growth.
- Ideas for A-B tests can come from various sources within the company.
- The decision of what to work on first is typically made by a product manager and engineering lead.
- Employees can drive a growth program by publicizing goals and efforts, and by contributing ideas for improvement.
- B2B companies are adopting consumer tactics and strategies for growth, but with a focus on building a sales funnel.
- B2B companies often have higher customer lifetime value, allowing for more creativity in online marketing.

- The speaker advises companies to make a list of potential customers and target them through various channels.
- Different strategies should be used for SMB and enterprise customers, as their closing cycles differ.
- Social proof is important in the enterprise world to understand how companies make decisions about new products.
- Experimentation with pricing and features is acceptable as long as it is done with good intent and the end use is considered.
- Paid marketing has become more common and should be treated as an accelerant rather than the primary growth strategy.
- Over-reliance on one channel, such as Instagram ads, is primarily a product problem and indicates a need for core product work.
- It is difficult to predict the shift from paid to organic growth in new markets, but understanding the shape of the growth curve is important.
- The addition of multiple marketing roles in a company can create friction and should be managed carefully.

- The video discusses the challenges of hiring multiple marketing roles in a company and the potential friction it can create.
- It suggests that companies can go longer without a VP of marketing and advises founders to solve individual challenges with individual people.
- The importance of joint accountability and avoiding multiple teams working on the same metric is emphasized.
- The role of brand marketing and its impact on growth is discussed, with a focus on measurable core growth activities.
- The growth of Airbnb is used as an example, highlighting the viral nature of the unique experience and the importance of online marketing and word-of-mouth referrals.
- Examples of step function improvements in retention or conversion are mentioned, such as Facebook's translation feature and mobile optimization.
- The approach to growth in new regions, such as Africa and UAE, is briefly discussed, with a focus on product limitations and cultural impacts.

- The speaker discusses two types of limitations in product development: product limitations and cultural impacts.
- They argue that cultural differences in product usage are often overestimated, with most countries using similar technology stacks.
- The speaker mentions that in some countries, certain platforms like Google are not available, requiring alternative strategies for product usage.
- They highlight the potential for startups to take advantage of low-cost advertising in emerging markets.
- The speaker discusses the changing landscape of viral growth, noting that it is more difficult to achieve and often occurs within closed networks.
- Referrals and incentivized viral growth are still effective strategies for growth.
- The speaker advises against hiring growth consultants and emphasizes the importance of building an in-house growth team.
- The speaker's consultancy, BasisOne, focuses on solving high leverage problems and providing insights to unblock internal teams.
- The speaker believes that growth can be balanced with improving humanity by optimizing for long-term metrics and using growth tactics for positive purposes.
- They emphasize the importance of having principles and asking why certain strategies are effective.

The speaker discusses the importance of understanding why something is working and how it impacts user behavior. They mention that much of this understanding is tied to engagement-driven products, which often compete for our attention. They suggest that there is a problem with advertising as a monetization engine and propose that if customers pay for the product, the optimization will be different. They acknowledge that these questions are challenging for companies fighting for attention, but beneficial for others.

- Dan Hockenmeyer advises startups on growth and emphasizes the importance of focusing on retention before heavy acquisition.
- A smart analytical generalist can create a spreadsheet model to analyze acquisition channels, conversion rates, retention, and monetization.
- Building a great product and being great at growth are interconnected, and small changes to improve user experience can have a significant impact on revenue.
- Experimentation and A/B testing are crucial in product development, and companies should focus on measuring retention and understanding user acquisition sources.
- B2B companies are adopting consumer tactics for growth, and different strategies should be used for SMB and enterprise customers.
- Paid marketing should be treated as an accelerant, and over-reliance on one channel indicates a need for core product work.
- Hiring multiple marketing roles can create friction, and joint accountability is important.
- The role of brand marketing and its impact on growth is discussed, with examples from Airbnb and Facebook.
- The challenges and strategies for growth in new regions, as well as the changing landscape of viral growth, are mentioned.
- It is advised to build an in-house growth team and balance growth with improving humanity by optimizing for long-term metrics.

Dan Hockenmaier is the founder of the growth strategy firm Basis One. Prior to Basis One he was the Director of Growth Marketing at Thumbtack. You can learn more at BasisOne.com.

Gustaf Alströmer is a Partner at YC. Prior to YC he was the Product Lead for Growth at Airbnb.

You can find Dan on Twitter @danhockenmaier and Gustaf is @gustaf.

The YC podcast is hosted by Craig Cannon.

Y Combinator invests a small amount of money ($150k) in a large number of startups (recently 200), twice a year.

Learn more about YC and apply for funding here: https://www.ycombinator.com/apply/

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Topics

00:20 - Dan's most unpopular advice

1:15 - What growth strategies do people jump on too soon?

1:50 - Questions Dan asks a company he's advising

3:20 - Traits Dan looks for in early growth hires

6:00 - How product and growth are tied together

11:00 - Good/bad learnings from Facebook's growth team

13:30 - A/B testing

16:30 - Retention and other metrics

20:15 - The importance of experimentation

23:15 - Getting ideas for A/B tests then choosing which to do

24:30 - Advice for employees who want to get a growth program going

28:30 - B2B vs consumer growth tactics

33:30 - Pricing experiments

35:00 - Paid marketing

39:00 - Launching in new markets

39:45 - Hiring for marketing

43:15 - Metrics for marketing hires

45:15 - Toni asks - Why did Airbnb grow so fast?

48:15 - Step function growth changes for companies that already had scale

49:25 - Michael Savage asks - It would be great to discuss growth into new regions for example Africa and UAE. What would their approach be, how does it differ from region to region, culture to culture?

52:00 - Justin LaRosa asks - What are some of the most common drivers of viral growth?

54:50 - Hiring a growth agency vs building your own team

57:50 - How do you think about growth in the context of improving humanity?

That we're talking about is actually tied to engagement-driven products.

So, product like you mentioned, fighting for our attention.

That's sort of like where much of this have happened.

And I think there is a fundamental problem sort of like with the driving the attention and then sort of like having advertising as a monetization engine.

If you change that and you say, actually I'm the customer, I'm paying for the product, then you get different outputs.

Because now you're optimizing for me as a customer.

I think there's like, there are nuances here and I think these are probably the most challenging questions to answer for companies fighting for our attention, especially if you're a free product fighting for attention, versus for many other products like I think it's actually massively beneficial to them to do a lot more of this.


Speaker 0: That we're talking about is actually tied to engagement-driven products. So, product like you mentioned, fighting for our attention. That's sort of like where much of this have happened. And I think there is a fundamental problem sort of like with the driving the attention and then sort of like having advertising as a monetization engine. If you change that and you say, actually I'm the customer, I'm paying for the product, then you get different outputs.

Because now you're optimizing for me as a customer. You're not optimizing for someone else. I think there's like, there are nuances here and I think these are probably the most challenging questions to answer for companies fighting for our attention, especially if you're a free product fighting for attention, versus for many other products like I think it's actually massively beneficial to them to do a lot more of this. That's great. All right, Thanks for coming in.

Thank you

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Advice on Organizing and Running Growth Teams from Dan Hockenmaier and Gustaf Alströmer