At $1M monthly revenue I didn't know how we'd do $2M.
By $5M it was clear how we could get to $10M.
Here's what I've learned about scaling a startup:
By $5M it was clear how we could get to $10M.
Here's what I've learned about scaling a startup:
1. Scale is proportional to VALUE x AUDIENCE SIZE
If you're not addressing a fundamental need for a large group of people or companies, true scale is unlikely.
Scalable niches:
• health
• wealth
• relationships
If you're not addressing a fundamental need for a large group of people or companies, true scale is unlikely.
Scalable niches:
• health
• wealth
• relationships
2. There are only a few marketing strategies that scale:
- paid acquisition
• organic
• product-led growth
Most products don't sell themselves.
A single big channel can make your business.
Defend it with additional channels in parallel.
- paid acquisition
• organic
• product-led growth
Most products don't sell themselves.
A single big channel can make your business.
Defend it with additional channels in parallel.
3. Scaling requires unprofitable experiments
You'll have to validate that:
- people want what you're selling
• you can reach them efficiently through marketing
Early LTVs can be low.
New channels may require different funnels.
Having money in the bank helps.
You'll have to validate that:
- people want what you're selling
• you can reach them efficiently through marketing
Early LTVs can be low.
New channels may require different funnels.
Having money in the bank helps.
4. Your message may matter more than the product
If you have the right product but wrong message, you won't scale.
Most consumption is based on "satisficing":
People aren't looking for the best, they're looking for "good enough".
There are exceptions.
If you have the right product but wrong message, you won't scale.
Most consumption is based on "satisficing":
People aren't looking for the best, they're looking for "good enough".
There are exceptions.
5. Differentiation wins
The paradox of disruption is that newcomers mimic the establishment because they want credibility.
The only way to outperform is to do what others don't.
This can branding, messaging, product differentiation, etc.
The paradox of disruption is that newcomers mimic the establishment because they want credibility.
The only way to outperform is to do what others don't.
This can branding, messaging, product differentiation, etc.
6. The internet is larger than you think
Many startups rely on the same 3-5 ad platforms.
There are thousands of ways to buy ads online.
Direct publishers are also eager to sell their own inventory.
Venture out...
Many startups rely on the same 3-5 ad platforms.
There are thousands of ways to buy ads online.
Direct publishers are also eager to sell their own inventory.
Venture out...
7. Scale is about more than marketing and product
Early growth may lean heavily on marketing or product.
Scale comes from compounding gains across all teams.
Examples:
- data -> marketing insights
• UX -> higher conversion rates
• customer service -> higher LTVs
Early growth may lean heavily on marketing or product.
Scale comes from compounding gains across all teams.
Examples:
- data -> marketing insights
• UX -> higher conversion rates
• customer service -> higher LTVs
8. Fixing mistakes is an underrated strategy
Every team has gaps in competency and areas of expertise.
• "Good enough" can hide some glaring defects
• We've seen this in wasted ad spend, faulty tech, broken processes
• Search for flaws, fix them and add to the flywheel
Every team has gaps in competency and areas of expertise.
• "Good enough" can hide some glaring defects
• We've seen this in wasted ad spend, faulty tech, broken processes
• Search for flaws, fix them and add to the flywheel
9. Treat your marketing engine like a machine
You need certain inputs to produce desired outputs:
- People: specialized expertise
• Budgets: mixing scale, margin & quality
• Creative: always be testing
• Campaigns: systematic optimization
• Analysis: deep insight
You need certain inputs to produce desired outputs:
- People: specialized expertise
• Budgets: mixing scale, margin & quality
• Creative: always be testing
• Campaigns: systematic optimization
• Analysis: deep insight
10. Defy the law of shitty clickthroughs
Scaling up means widening your audience.
Performance will decline naturally.
To keep acquisition costs steady, you'll have to increase the effectiveness of your marketing funnel proportionally.
Scaling up means widening your audience.
Performance will decline naturally.
To keep acquisition costs steady, you'll have to increase the effectiveness of your marketing funnel proportionally.
11. At scale, EVERYONE is your competitor
You're competing with ALL advertisers for wallets and attention.
If your funnel can't monetize as well as a dating app or weight loss program, you won't be competitive in the biggest arenas.
You're competing with ALL advertisers for wallets and attention.
If your funnel can't monetize as well as a dating app or weight loss program, you won't be competitive in the biggest arenas.
That's a wrap!
If you enjoyed this thread:
1. Follow me @bbourque for more on startups and marketing
2. Retweet the tweet below to share this thread with your audience
If you enjoyed this thread:
1. Follow me @bbourque for more on startups and marketing
2. Retweet the tweet below to share this thread with your audience
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