I’m the CEO and co-founder of Preply, a global marketplace for online tutoring. I’m lucky to have awesome co-founders, Dmytro (CTO) and Serge (Product). Together we started Preply in 2013 and had been bootstrapping until we joined the Techstars family in 2015. We then started growing our team.
Here are some helpful takeaways from our journey as you start to grow your startup team.
Changing Roles of Co-Founders
Your role as a co-founder of the company is not static and will change over time. Here are a few stages you may experience:
- Operator. You are doing things yourself, whether it is email marketing, coding, designing or supporting customers.
- Early manager. You have your first people on board. While still doing a lot of things on your own, you start learning how to be a good manager.
- Manager. You stopped doing most of the things and focus on being a good manager.
- Executive. You manage other managers across your company. From this point, you don’t have control over execution; you have to rely on your managers.
- The essential skill of being an entrepreneur is fast learning. It’s difficult to overestimate it.
- When you stop managing operators, it’s the right time to start thinking about building the right culture. It will be one of the few ways to impact your company. Someone said: “Culture is management on a scale”. I cannot agree more on that.
- Start preparing yourself and co-founders for management and executive roles earlier. In the end, it’s a difficult transition with entirely different skill sets. You have to learn how to hire, delegate, teach, develop, and build the right culture.
Hire Finance and HR Earlier
We hired Finance and HR functions early, and it helped us a lot. First of all, I freed myself up and spent much more time on building the right product and marketing. Thanks, Jens Lapinski (MD, Techstars Berlin 2015) for that advice.
Secondly, people I hired were much better than me in building the right finance, HR and hiring processes. That helped to make fewer mistakes and grow faster. Here’s a good piece of content by Christoph from Point Nine Capital about the right timing and importance of hiring HR.
Hire the Best
You can read about hiring the best people in a lot of books and blogs, and it’s imperative. One wrong hire can significantly lower your chances to be successful. At the same time, I believe that old school rule “hire slow, fire fast” no longer works.
That was a safe option, but in our competitive world, the ability to hire fast is crucial. So, you better learn how to do that properly.
Here are a couple of resources that helped me in my journey:
- Hire for strength rather than lack of weakness: Hard thing about hard things.
- It’s worth spending time understanding what the key questions are that you want to ask a person for them to make an immediate choice. Here’s a legendary blog post with a good list of questions for hiring a product manager by Ken Norton, a partner of Google Ventures.
- Paramount book about hiring: Who: The A Method for Hiring.
Another moment worth mentioning is that you have to build the right expectations for your leaders and co-founders about future hirings. It should be apparent for everyone that the company will hire new experts, managers and executives as it grows.
People that can lead the company today are not the same people that can drive it tomorrow.
Also, your ability to hire the best is growing as your startup grows. The most important thing here is to make sure your current leaders will stay and learn from newcomers.
Additionally, I would encourage you to spend time meeting opinion leaders in different areas. They may help you with advice and their network, but also one day you may hire them. At Preply, we did a good job hiring the best people, because we were in touch with them when they decided to change their life.
A bit later, my co-founder Dmytro learned more about that at a Paris CTO meetup by Point Nine Capital (his event review here). We decided to test it, and the results were outstanding. It completely changed the dynamics inside the company.
In a cross-functional organization, you are building squads around specific metrics, not functions. For example, a team that is focusing on conversion rates may include:
- Product manager
- Product designer
- Front-end engineer
- Two full-stack engineers
- Email marketer
- Customer success manager
If you are adopting such an approach, I would try to make sure that you have T-shaped PMs to lead squads. They would need to build excellent communication within the team, so everyone understands what, when and why.
The beautiful part here is that a cross-functional approach makes your life easier when it comes to scaling a team. Growing from five developers to twelve in a functional structure will give the CTO a hard time reorganizing everything and continue to distribute tasks from the product, marketing and sales teams.
With the cross-functional approach, PMs are responsible for managing. The CTO needs to be an excellent tech mentor and build the right tech culture.
I would compare the cross-functional approach with building a business accelerator. Every squad is an independent mini-startup, and your VP level people are mentors. As mentors, they will provide with the right focus, metrics and their expertise when it’s needed. The squads will then execute it independently.
I promise, I promise. I’ll refer you to my whole network, and bring you tons of business.
If you haven’t already, you’re going to meet tons of “flakes” in your startup career. There are different breeds of flakes. Keep your eye out for all of the following species:
- The Well Wisher – This person always tells you about the contacts he/she will tell about your business, but never actually does it.
- The Guarantor – This person promises to be a fantastic partner or vendor, but unfortunately the “timing” is never right.
- The Genie – This person will take all your woes and wishes them away with a swift magic wand. Alas, he/she never comes through.
- The Yin to your Yang – This person seems like the perfect complement, a cofounder made in heaven. But of course, this never quite materializes.
You need to be careful when dealing with flakes while running your business. In fact, you may even find reliable contacts end up not living up to promises in the business world. It is your responsibility in business to make sure that you don’t waste your time on unreliable people.
Also, if you are constantly being strung along, the message is loud and clear. You need to craft the right value, the right motivation and the right incentive, to the person you are trying to reach. It’s the only way to get the attention and the leverage your need from that person. Focus your energy on identifying the right people that you can work with in every situation.
A sneaky trick that can often work, is to grant the “flaker” a favor, only if he/she stays true to what he/she promised you.
Let us know what flakes you have dealt with in the comments below.
In 1996, an email company named Hotmail launched with a small group of users. By the end of 1997, that company had 12 million users.
How did they grow so dramatically in just year and a half? Well, they looked at their initial numbers and saw that approximately 80 percent of new users came by referral from current users. To make the most of referrals, Hotmail created their iconic email postscript: “PS. I love you. Get your free email at Hotmail.”
That single line, added at the end of every email sent through Hotmail, drove millions of new users in an ever-widening ripple effect. Hotmail successfully created one of the first documented growth hacks.
Growth hacking is the combination of product design, marketing, and data with the overall goal of driving customer growth. Initially popular among fast-growing startups, the principles of growth hacking have since spread to the wider business world. With a focus on understanding the customer and designing the right product, successful growth hacking drives growth in both the short- and long-term.
So how can you apply a growth hack like Hotmail’s to build your own business?
Let’s explore nine innovative and data-driven growth hacks that you can adapt to your own situation.
1. The Webinar Hack
When you’re trying to find potential customers, you don’t just want to reach a massive number of people. In fact, you might not need to reach very many people at all. You just need to find the right people.
Unbounce uses a variety of content marketing technique to reach customers. They write a popular blog, produce quality ebooks, and even offer a free email course. But when they started focusing on webinars those quickly became their number one acquisition strategy.
Because webinars offer an urgent incentive (“join before it fills up!”), you can drive significant interest. Once in the webinar, you get the opportunity to provide high-value teaching, which improves the perception of your company.
And at the end of the webinar you get a few minutes to explain your product.
Here’s how to run a successful webinar with very little work:
1. Pick a topic or get a guest speaker.
2. Create the webinar on GoToWebinar.
3. Make your landing page where people can join.
4. Do a dry run to make sure everything works.
5. Host the event and provide epic value.
6. Follow up with an email and encourage people to become customers.
Then assess how the webinar went, make a few changes to your strategy, and do it again.
2. The Giveaway Hack
AppSumo, a daily deals website focused on digital goods, has been extremely successful at running giveaways to increase their email subscription list. In just 10 months, by 147,973 new subscribers. Since each subscriber resulted in an average of $0.83 gross revenue, that’s a pretty significant marketing campaign.
So how’d he do it? Simple: He ran a steady stream of targeted giveaways.
He gave away Evernote subscriptions, in-person courses, and even MacBook Airs (the MacBooks performed worst!). Some giveaways drove a few subscribers and some drove thousands, but giveaway by giveaway the email list (and bank account) grew steadily.
So how can you run your own giveaway?
1. Find a specific product that only your target customers would like (broadly popular products attract generic leads).
3. Promote your giveaway with Facebook ads and your current email list.
4. Encourage social media shares for your giveaway participants.
5. Send a drip campaign to your new leads to convert them to customers.
If you choose the right product and audience, the money you spend on Facebook should start a chain reaction as current participants share your giveaway with their friends.
3. The Guest Post Hack
When Charlie Hoehn wanted to drive sales for his first published book, he turned to guest posting to reach potential readers. During the first month after publication, Charlie published nearly 20 guest posts and also made guest appearances on a couple of podcasts.
The result? He reached nearly a quarter of a million people and sold 2,000 copies. His self-published book landed on the top of its Amazon category.
Guest posts are powerful tool that can drive highly targeted visitors to your website. So how can you do the same thing for your site?
Here’s how you can create guest posts to drive customers to your own website:
1. Find popular blogs with audiences that match your target customer profile.
2. Write value-packed guest posts targeting particular blogs.
3. Email the blog author with your proposed guest post.
4. Continue emailing until you find a blog that’s interested in publishing.
5. Repeat … and make your posts better each time.
To make your guest posts even more successful, put together a custom pack of bonus materials for readers who join your email list. You can use extra information like PDF checklists, case studies, and exclusive videos to convert more leads from each guest post you publish.
4. The Two-Sided Incentive Hack
Since 2009, the car service Uber has raised millions of dollars and is currently valued at $18 billion. It’s now available all over the world and are even planning to break into the lucrative mainland China market in the near future.
To spur word of mouth even further, Uber uses a two-sided referral program. All current customers are automatically enrolled and given their own referral codes. When they give those codes to their friends, both the referrers and the customers they refer get a nice credit to their Uber account.
This gives the new customer a chance to try the service for little or no cost, and it gives the referring customer a friendly “thanks” for sharing.
To create your own double-sided incentive:
1. Make sure your product is worth sharing.
2. Find something current customers will value. Free credit is an obvious win, but swag or VIP status might be good too.
3. Find something that will hook new customers. Free trials or credits will let them try your product without any risk.
4. Promote it to all your current users through email and in-product messaging.
If done right, two-sided incentives can drive significant word of mouth, increasing the impact of all your other marketing endeavors.
5. Exit Popup Hack
WPBeginner, a free resource site for WordPress beginners, grew their email subscription list by using an exit popup display. In less than 10 minutes, WPBeginnerincreased their email subscribers by 600 percent. Prior to the change, they gained 70 to 80 new subscribers each day, and after the change they gained 445 to 470 every day.
How did they drive such a significant improvement? Using a simple popover with exit intent tracking. When a visitor arrives at their website, WPBeginner starts tracking their mouse movements. If the visitor’s mouse starts moving to close the window, a non-intrusive popover invites the visitor to subscribe for more articles.
By giving the visitor time to read before offering the upsell (i.e., the subscribe box), exit popups reach potential users at a time when intent is high, thus boosting conversions. Additionally, these popovers are non-intrusive, so the user can easily close the tab without any of the annoyances of a traditional popup.
To create an exit popover of your own…
2. Add copy for a simple subscribe box.
Bonus: Create a special ebook or email course as an incentive.
Popovers always drive significant email signups since they’re more noticeable, but popovers with exit intent take it to the next level.
6. Retargeting Hack
Nitro, a commercial software development company, runs their business with a freemium business model and they receive a lot of trial users who never convert to a paid plan. To combat this conversion issue, they experimented quite successfully with retargeting ads. Using IP addresses, retargeting ads show specifically to people who joined Nitro’s trial but haven’t yet converted to a paid plan.
After launching these retargeting ads, Nitro has seen an 18 percent increase in online sales. Even better, they’ve seen a 3.9 times return-on-investment (ROI), which means that for every dollar spent on retargeting ads, Nitro has made $3.90.
The technical side of retargeting ads based on IP addresses sounds super complicated, but happily setting up your own retargeting campaign is actually really easy.
Here’s how you do it:
1. Join a retargeting service like Adroll (my favorite).
2. Add their code snippet to your website (just like Google Analytics tracking).
3. Select an audience to retarget (people who visited your website, trialers, etc).
4. Create an advertisement image (I used Paint.NET).
5. Start your campaign.
6. Test different campaigns to optimize ROI.
Like any other advertising platform, retargeting experts can help with all sorts of detailed optimization, but you can still achieve amazing results in just a couple hours of setup. If I did no other paid advertising, retargeting ads are the first place I would spend my money.
7. Drip Campaign Onboarding Hack
Too many marketers think their work ends once a customer signs up. On the contrary, joining your product is just the first step—acquisition. Now you need to help them activate by helping your users form a habit.
This process of onboarding can be dramatically improved with an automated drip campaign. Based on your knowledge of common questions, you can design a drip campaign with something like Intercom that sends a series of “power user” tips.
How effective are onboarding drip campaigns? Editing software Draft used this onboarding hack to improve the conversion from freemium to paid. With just one automated message, they boosted revenue by 200 percent.
Here’s how you can create your own automated drip campaign:
2. Integrate the code snippet on your website.
3. Create a series of 4 to 10 messages over a user’s first few weeks.
4. Watch for common questions and add them to the drip campaign.
Optimally, your onboarding campaign will answer common user questions and help users for habits around your product.
8. Invite-Only Hack
How did SpringSled drive 150,000 beta users in four weeks? Long before their product was finished, SpringSled opened their registration for beta users. Each early access signup to SpringSled gets the opportunity to land 12 months of free project management by getting five friends to join the beta version.
After briefly driving some traffic by getting on ProductHunt and BetaList, the customers started pouring in through viral spreading. The “12 months of free project management” prize has worked quite effectively, and 99.8 percent of those first 150,000 signups came from referrals.
How can you design your own early invite hack?
2. Setup an email drip campaign encouraging referrals.
3. Drive some initial traffic (ProductHunt, BetaList, Reddit, StumbleUpon, etc).
Bonus: Add a launch video
While many of the early invite users you drive will probably be low-quality leads, getting this level of interest before you even launch will definitely give you a solid base of initial customers from which to build.
9. The Live Survey Hack
Every customer is different. They have different problems, different experiences, and different interests. They all come to your product for their own unique reasons.
And yet, the traditional landing page gives each of them the same static page. A/B testing lets you improve this page to help the most people possible, but everyone sees the same static page.
What if you could give different information for different customers? Using a live survey tool, you actually can do just that!
GoodBlogs wanted to increase the number of writers for one of its sites, The Flaming Vegan. To do this, they created a Qualaroo survey that asks new visitors if they’re vegetarian or vegan. If you answer “yes”, they ask if you’re interested in writing for the website. (If you answer “no”, the offer a discount on a blender.)
By implementing that live survey, GoodBlogs has increased new writer registrations by fully 300 percent.
Here’s how you can create a live survey:
1. Create 2 to 4 customer profiles (based on the people who come to your website).
2. Write 1 to 2 questions that filter these people.
3. Design a killer offer for each group.
4. Put this all together in a Qualaroo survey on your website.
Each customer is different so giving them custom offers based on their interests will help you dramatically improve conversion rates.
The #1 Thing To Remember
All these hacks are powerful and can help you improve conversions, but growth hacking is actually much simpler. Tactics help, but the best products win by making customers happy. If you can make your users happier than a bull in a china shop, you will see sustainable growth.
Focus on building a product that hooks users and then use marketing to grow even faster.
It’s an epidemic out there in the entrepreneurial world.
Anyone out there suffering from CAPS (Customer Acquisition Procrastination Syndrome)? Symptoms include the eager urge to work on ANYTHING and EVERYTHING except finding customers to build a new business. Your doctor (or mentor) doesn’t need to tell you that building a business is contingent on finding paying customers, yet new entrepreneurs often dive into the more fun, less important tasks first!
Here is a list of symptoms that show that you may be suffering from CAPS. If you are an entrepreneur that has done any of these before or instead of finding customers, you may need intervention:
- Are you tackling social media completely manually? Or consuming it constantly?
- Do you have a constant, burning urge to check your stats: Facebook likes, Twitter followers, email list subscribes and unsubscribes.
- Do you find yourself running errands ALL. THE. TIME?
- Are you bogged down by clerical tasks instead of growing your business?
- Did you find and rent a fancy office space, before you had clients?
- Are you on a hiring binge – before you have actual work for the new talent to do?
- Did you throw a red carpet launch party, before actually finding a customer?
- Spending all day browsing email newsletters, reading blogs, watching videos, and skimming books?
- Did you spend months creating a fancy logo, slick business cards and a fancy feature-and-content-filled website before you were certain about the product you were offering and the customer you were offering it to?
- Are you letting daily stimuli sway your day instead of spending the day focusing on building actual leads and customers?
- Are you feverishly attending random networking events in the hopes you will meet the right people that may help spread the word about your business?
The only cure for this severe ailment is to find your first paying customer! And after that, rinse and repeat as often as you can, every day.Have you procrastinated in finding a customer? Please share your experiences in the comments below!
This was originally posted on #entrepreneurfail: Startup Success.
This article is written by Nick Rojas.
Everyone knows that the first quarter is make-or-break time for startups. Even if you have all the variables plotted out and a rock solid business plan, if you’re not bringing in money, you’ll have to shut down and try again, assuming you still have the resources.
But just because you make it out of the first three months in the black doesn’t mean you’ll have the same success after the first year. Scaling your startup’s growth is something that needs just as much early attention as keeping your doors open and your ledgers full.
Proper scaling involves not stagnating when you’re in a comfortable but unsustainable spot, and it also means not trying to crack the Fortune 500 when the ink is still drying on your business cards. It’s a careful balancing act of expansion and caution, physical presence and mobile development, spending and earning.
The infographic below, provided by SmartTollFreeNumber.com , offers some interesting statistics that should be considered when it comes to appropriately scaling your startup’s growth, especially when it comes to how scaling poorly or not at all could bury your company before it ever had a chance. Check it out, put together a plan for your own business, and help your business reach new, reasonable heights!