Getting traction for your tech company isn’t easy. You need resources, whether that means bootstrapping or getting a lift from angels. You need smart people. Perhaps most of all, you need to be able to adapt when times get tough. A consistent theme of the recent Traction Conference in Vancouver was that as easy as it is to gather piles of data on every conceivable metric, it’s another thing to be able to pivot based on what you’ve discovered.
In speaker sessions and one-on-one chats, we heard from many tech leaders at Traction who generously shared their stories of adapting their strategy so they could come up for the win. Here are the highlights.
First up was a panel that tried to answer the question of whether ‘growth hacking’ is a myth or something based in reality. It turns out that the panel wasn’t too keen on the concept.
“I don’t have much love for the term, growth hacker,” noted Aatif Awan, Head of Growth, LinkedIn. “It’s just an optimization-minded approach to building your business, It’s about being scrappy – and all members of startups have to do it… The term growth hacker is just a few years shy of sounding like ‘social media guru’.” Only after a company gets to a larger size can you start to develop dedicated growth teams with dedicated champions, he noted later.
“The myth around growth hacking is that it’s just one thing,” added Ivan Kirign, CEO of YesGraph. “The truth is that there’s no silver bullet.”
On a related topic of what kind of metrics companies should track while trying to get traction, Awan pointed out that whatever you choose, it needs to be a core metric that relates to revenue. “For instance, it’s common to look at the number of users or the number of signups to gauge success for a new app,” he said. “But the really important metric is usage.” If you’ve got a lot of signups but little engagement, you might just be fooling yourself.
Combining organic growth with other options to get traction
Following in that vein on a more specific note, co-founder & co-CEO of AppDirect, Daniel Saks, presented Build vs. Buy: How Young Companies Can Grow Faster, Smarter. “We started out in 2009 at the height of the recession, with two people in a small apartment. We’ve grown to 300 employees around the world today,” he said.
How did they do it? Their path to success started with organic business development, using their signing of Bell to reach out and sign up Bell’s partners – and after developing a reputation for reliability, building out from there. To build up the capability to service their growing client base, they had to buy and partner with other firms – but the choice wasn’t always easy. “There has to be alignment of culture, vision and technology. It has to be the right fit,” Saks said.
Motivators for success
I wanted to delve beyond the big ideas discussed on stage and get down to the details of how some of these leaders had ‘growth hacked’ their way to success – or at least hacked a viable escape plan when all their growth plans went south. I cornered Robert Cezar Matei, Head of Growth with Quora, in the media room, to get his personal take on pivoting to grow. It turns out that the pressure of impending corporate disaster is a great motivator.
“Before I was with Quora, I was at a company that was trying to make games and Facebook apps,” Matei said. “We were making complex games and running out of money, doing it. We started experimenting, trying to get ad revenue and then changing our model to just make simpler apps. We iterated a bunch of product ideas and one of them was an app that could send greeting cards to friends.”
The app was getting some good traction in the local marketplace, but it took crafty use of data to take it to the next level. “We noticed it got five times the traction in France – and so we internationalized it. That’s when we really got traction.”
The lesson? You have to be willing to iterate fast if something isn’t working – which can actually be harder to do in a bigger company, Matei noted. “Big innovations require some leeway to get big – but too much leeway, like having too much VC funding, can result in you going down the wrong path for longer than you normally would before changing course.”
Getting your brand out there
Some companies try to get traction with a lot of buzz. It’s great when it works – but sometimes, it doesn’t. “We launched with a PR approach,” recalled Nate Moch, Zillo’s VP of Growth. “We had this mysterious, secret launch and when it happened, we got into the Wall Street Journal because of it! We cheered this big win – but at the same time, we’d totally ignored SEO.”
Big mistake, at least according to their web traffic compared to a big competitor. The other company had already locked down a lot of the keywords that matched Zillo’s brand – and it took plenty of effort to build up Zillo’s SEO to match. “It’s not that we were wrong to focus on the PR and branding, but we had to shift emphasis.”
On freemium, fads, and pivoting to avoid failure
If there was a mantra of the Traction conference, it was “you’re going to fail – lots. Learn from it, strategize and try something else.” Marketo CEO Phil Fernandez could relate, as he chatted with me outside the conference in downtown Vancouver, looking towards the seawall. “We had to abandon our first business model. We were making complex software and getting it to users on a freemium model – and it wasn’t working,” he said.
The team at Marketo realized they needed more commitment from customers. One way to help get that? Raising the price by 20 times compared to what they were initially selling it for. “People had to have more skin in the game,” Fernandez says. “A lot of business models are fads – open source, freemium – but you need to stop paying attention to fads and pay attention to how your buyer is meeting your software. Match how you sell your product to your target customer.”
Which isn’t to say that a freemium model isn’t going to work for everyone. Describing how SurveyMonkey went from a 20 person team to more than 500 employees serving an international market, President and CTO Selina Tobaccowala offered this pearl: “if you’re offering something for free that is improving the virality of the product, keep that free. Other features can be part of paid plans.”
Tobaccowala also noted that the rules may change from country to country: “we have different pricing and marketing for the different international markets.” A/B testing isn’t just for clients using their product – “we’re constantly testing and that’s how we can avoid years of failure.”
Of course, pivoting at the right time means recognizing that you’ve failed in the first place. That’s hard, for a lot of reasons, noted Ben Yoskowitz, Co-author, Lean Analytics and VP Product. “You’ve committed, raised capital and you’re thinking, if I just plow through and work harder, it will work out in the end – but you’re just deluding yourself,” he said. “This is why it’s important to choose the right metrics. If you’re looking at the wrong set of numbers but those metrics are looking good, it’s harder to admit things are not right.”
How do you know which numbers are right? “There’s an element of ‘gut’ to it. Now, this is complicated because we often hear that persistence is what got successful people to the top. Lean Analytics isn’t meant to destroy your reality distortion field that successful leaders have – but it is there to poke holes in it.”
The big takeaways? Try stuff. Watch it fail – because most of it will. Pick yourself up, dust yourself off, check the (right) numbers and try something else. Make sure everyone is focused on growth – and when you get big enough, you can hire someone with ‘growth hacker’ in their LinkedIn job description.
Images courtesy Traction Conference.