The Growth Hack We Keep Ignoring


The Growth Hack We Keep Ignoring

The SaaS model started a revolution of sorts.


The SaaS model started a revolution of sorts.

The brighter players in the game of business caught on quickly. The ones who had grown "too big to fail" tried to ignore it.

When your revenue relies on customers renewing their subscription every month, you have no choice but to view them as people. Their patience is limited, their loyalty is only as big as yours, and relying on word-of-mouth marketing makes their good word worth every minute spent on nurturing the relationship.

Eventually you start to think of other players in the market as parts of a potential relationship.

Business may be a zero-sum game for some: everyone is your competition, so you must fight for every scrap of the market regardless how many legs you have to break in the process. As Seth Godin wrote in his classic post about business development:

smaller competitors are so focused on their core business that it never occurs to them to consider partnerships, licensing, publishing, acquisition and other arrangements that might change everything.

Thinking of business as part of a global network of people, relationships, and correlated goals, opens up a new way of thinking about growth.

#1 The prisoner's dilemma

Business can be seen as a variation on prisoner's dilemma.

If every player looks out only for themselves, they keep all their assets and competitive advantage. And chances are, if they donated their resources to the pool, the other players would not. They'd be left hanging out to dry.

There's some truth to that. Entrepreneurship is a dog eat dog world.

But let's look at the other side of the prisoner's dilemma.

If everyone involved cooperates, the result is synergistic. What is put in the common pool of resources gets multiplied.

The only requirement for that to work out, is an agreement and some amount of trust. If everyone in the game cooperates, everyone wins.

#2 The secret of Growth Hacking is partnership

If you look at the lists of legendary growth hacks, you'll see that most of them depend on establishing a partnership between groups of users.

The market-hacking tricks that started the Growth Hacking cult, those done by Dropbox, AirBNB, Uber, PayPal - they all leveraged groups of users with different goals, whose paths crossed somewhere along the way.

The users were using the same product to achieve different goals.

That's how virality works: you create something other people want to share to gain something. To get attention, build their reputation, entertain or help people they know. Each piece of viral content is a mutually beneficial partnership between the creator, the sharer and the audience of the sharer.

Everything in the growth-hackable scope works by leveraging a partnership.

#3 Partnering up and down

Business development is a good move for every stage of company growth:

Early stage startups use business partnerships to quickly expand their reach - either by cheaply outsourcing growth to their users (see: Dropbox and their referral program) or by teaming up with a bigger player in a related field (see: every product that has an API and integrates with another popular product).

Rapidly growing companies partner up and down. Up: by plugging into the reach of a giant like eBay, like PayPal did. Or another example, Baremetrics, which is an analytics platform built for Stripe, which is a hugely popular payment platform... built on top of nearly all the legacy payment platforms out there.

Partnering down: by establishing a symbiosis with smaller products, dedicated add-ons or simply users of their own product. Stripe hires people whose whole job is nurturing a community of independent developers who build their own Stripe integrations. Stripe benefits from the developers who benefit from making Stripe accessible to more users.

A mutually beneficial partnership which growth-hacks Stripe's reach.

#4 It's not a hack if it's not quick and cheap?

The problem with quick and easy growth hacks is what Andrew Chen calls The Law Of Sh**ty Click-throughs.

In short: If it's easy, everyone will know about it tomorrow, everyone will be doing it next week and it'll stop working in two months.

The only evergreen growth hacks are those designed to provide real value. They take time to build, but they last for a long time. Business partnerships are some of the longest deals to close. They require patience, subtlety, diligence and respect. Maybe that's why so few companies think they can do it.

So the next time you're about to anonymously ask the 287367th question on Quora that's an iteration of "how can I hack my startup's growth?" ask yourself: what two completely different user groups could benefit from each other by using your product?

And when you ask "what is a good way to superboost my growth," think about that saying about standing on the shoulders of giants.

So research some giants and think what they need that you can help with.

The best growth hack that always works is looking for people that you can help in bringing value to their network.

Noam Bardin makes a good case for why you’d want to avoid formal business partnerships at early stage startups. But, every partnership is different, and every startup journey is different. You should consider both sides of the debate and keep an open mind for opportunities with other players in the market.

If the partnership idea fits your business vision and stimulates your growth, and doesn’t deter you from your chosen path, my advice is to consult your own plans and values, not blog posts.

Marta believes that everything is a footnote to Plato and that the only marketing trick you’ll need in the 21st century will be giving up marketing tricks and being a real human. Tells real stories about digital transformation.

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