Sean Ellis is a growth hacker legend. He coined the name Growth Hacker. But even more interesting is his thought process around growth, and how he’s always wanting to learn more. It’s inspiring. He helped companies very early-on like Dropbox, Eventbrite and logmein develop and implement their growth strategy. Those companies did OK I’d say. He’s currently the CEO at GrowthHackers.com.
If you want to learn more about growth and the questions to ask yourself and your organization, you should listen to this interview.
Here are some other topics we cover:
-What were some key points in your career that made the difference? He talks about the early days of Internet marketing.
-What’s one key lesson you learned early-on in your career?
-What are some key skills to be a growth hacker?
-If you could join a growth team of one company, which one would it be? He actually named two.
Dave Kruse: Hey, everyone! Welcome to another episode of Flyover Labs from Madison Wisconsin. Today, we have Growth Hacker legend with us, Sean Ellis and I’m not even sure where to start with Sean’s background, he’s done a lot of stuff. So, he’s currently the CEO of GrowthHackers.com, which is a community for growth hackers and before that, he played a big role in the growth at companies like Dropbox, Eventbrite, and LogMein and he is also the Founder of Qualaroo, which is all about website service. So, as you can tell, he’s one of the main leaders in the growth hacker community and what is a growth hacker, well we’ll get into that but you can imagine that it is a little bit about growth. So, Sean thanks for joining us, we definitely appreciate it.
Sean Ellis: Yeah, awesome to be on, thanks Dave.
Dave Kruse: So let’s first start off the first half by talking more about you personally, your background and how you got into marketing and growth hacking and then the second part talking more about GrowthHackers.com and maybe how you help businesses. So first off, you’ve got a big back ground, you’ve done a lot of stuff…, what is your background and how’d you get into growth hacking.
Sean Ellis: Sure, yeah so my first growth role was in a company that I joined in 1996, I had been out of collage for a couple of years and moved to Eastern Europe; to Budapest, Hungary and a friend of mine was starting an internet company at the time and you know those were early days of internet companies and so 1995, I got excited about what he was doing and invested pretty much everything I had into company and then joined him maybe 6 months later and you know, when you got all your money invested in the company you kind of, you approach it a little differently and you know, it turned out that online marketing was quite a bit different from traditional marketing and so I was just getting started in 1996, but I think I had the benefit of actually, you know caring more about real results than sort of perceived results, which sometimes marketers spend a lot of time on perception and maybe less time on reality and for me, I just didn’t want to lose all my money so I was really focused on trying to create a valuable company and so that’s where I got started and … go ahead.
Dave Kruse: What do you mean by real results… ?
Sean Ellis: Yeah! Sometimes companies are lead by hype a bit and you know when you look under the hood there’s not a whole lot of substance there, and it can spread even within the company so, you know if I’m signing up 500 people a day and it’s just in the beginning, people might say ah! that’s amazing, like in your company they might say you’re doing such a great job, you know, if I’m looking and saying yeah, I signed up 500 people but the first thing I want is, them using the product, so perception internally is that I’m doing a good job but the reality is that I added “zero” value to the business. So, for me it was about like, you know, really assessing the results of what we were doing from a marketing perspective to make sure that we were really acquiring customers, they’re really getting value from what we were doing, so this was actually an online game’s company and, you know, it’s interesting because I actually started in a sales role with a company and I was selling advertising but we had almost no users on the website so buying an advertisement at retail with no users is not very valuable and so I kind of told the CEO that it would make more sense for me to maybe focus on customer acquisition for a little while and not on selling the advertising and so I put the efforts into customer acquisitions and I originally went out and spent; I’d think a minimum buy I could do on a search engine at the time was like, $20,000 and so…
Dave Kruse: Wow.
Sean Ellis: How scary for an early stage company. So, I spent $20,000 and you know, maybe got like a 100 customers from it and basically my CEO said that’s great, we’ve doubled our users, so maybe we had a 100 before that and that’s where I kind of starting looking at it, yeah, so it’s like gosh, you know 100 users, $20,000 that’s not very sustainable and that’s probably not a good use of, there’s no way those users are going to be worth $200 to us and so you know, just over time I got better at figuring out like buying maybe on lower tier websites, you know, where it would allow me to test for $500 dollars and then get a read, so the company ended becoming a public re-traded company and when we listed, we had the lowest customer acquisition cost for a free-registered user of any public re-traded company. So, yahoo was one of the best at the time, I think they were about $30 and we were at $6.
Dave Kruse: Wow.
Sean Ellis: And you know, at a time where everybody else was, you know, buying ads on television and super bowls, and you know, sock puppets and we eventually, after we went public, ended up doing some television advertising but that was under, you know, Head of brand marketing and stuff that I wasn’t really focused on so, that was kind of how I got into it and then the same group of us who sold that company to Vivendi Universal and the same group of us started LogMein in Budapest, after we sold Uproar and then I ran marketing at LogMein for 5 years until we filed to go public and then I decided I wanted to take on some new challenges, and basically realized that on looking at those two companies that the, you know, the most important thing that I did at each company was, you know, the upfront stage and kind of figuring out how these companies would grow? why customers wanted it, getting the measurement systems in place and the testing and kind of all of these things that, you know, the infrastructure to sort of support long term growth and some of that earlier channel discovery and realized that kind of in the later years it was managing a lot of the channels that we had already discovered and so I wanted to get at that upfront stage and I then moved to Silicon Valley and for the next few years ended up working with companies just for 6 months at a time and helping them get started with growth and that was when I worked with Dropbox and Eventbrite and Lookout …,
Dave Kruse: What year did you move to Silicon Valley?
Sean Ellis: That was in 2008.
Dave Kruse: Ok and that’s when you got hooked up…
Sean Ellis: Or actually … 2007, actually is when I moved there, but yeah.
Dave Kruse: Ok, and that’s when you actually started working at Dropbox at around 2008, is that right?
Sean Ellis: Yep, 2008, so I basically split my time 50 – 50 between Dropbox and Eventbrite for a 6 month period and that was a good first couple of companies to get involved with, at the time Dropbox …
Dave Kruse: Did you just get lucky or did you…
Sean Ellis: Yeah! I got pretty lucky, at that time Dropbox had 7 employees and I just … first thing when I moved to Silicon Valley, I worked for a company called Xobni and Xobni sold to Yahoo a few years ago but the founder of Interim VP marketing rolled for 6 months where it was just focused on Xobni and the Founder and CEO of Xobni when I joined was a paternity brother of Drew Huston, the Founder and CEO of Dropbox, and so, they both went to MIT together, and you know there’s a lot of mistrust in marketers from engineers and so you know the fact that, like you know, I was being referenced by another engineer CEO, I think kind of helped me get the foot in the door a little bit, you know, somebody who he trusted a lot and then I just emphasized that if most marketers are going trying to make this look like a lot of hocus pocus on how it works but it’s actually numbers driven and stuff that should be totally comfortable in the wheel house of engineers and that my goal in doing … a 6 month role would be wisest to do, knowledge counsellor will make you very comfortable at managing the growth process and really set you guys up for growth and that’s what I focused on with him.
Dave Kruse: And when I said, where you lucky but at the same time, you probably helped him give a nice platform for growth in those 6 months so that they could figure out how to grow to where to they are now.
Sean Ellis: Yeah! I think the luck is being in a place that had a lot of potential but you know, the part that’s not lucky is helping them realize that potential and certainly Dropbox had a lot of potential, Eventbrite had a lot of potential, and the way I got into Eventbrite was again through a contact on the Xobni side, one of the investors of Xobni, Edwards was impressed with what we were doing and made an introduction to Eventbrite, which they set up, so basically doing good work in one company led to the doors opening in a couple of more companies.
Dave Kruse: Yeah, I guess that’s how life works, you do good work and more doors open.
Sean Ellis: Yeah.
Dave Kruse: Well, go ahead.
Sean Ellis: I was just going to say yeah it’s definitely about you know earning trust and not messing that trust up because especially in Silicon Valley, where it is…you know, a lot of people kind of talked about as being hard to break into Silicon Valley and that you need to like know somebody to get in, but you know, at the end of the day Silicon Valley is the land of innovation, there’s so much great stuff that’s been accomplished there and that wouldn’t have happened if it wasn’t a pretty big meritocracy; if you treat somebody badly, or you don’t do good work or you know, word gets out pretty fast and then if you’re good, they don’t care what your background is , because if you’re good, people find out about it and word spreads quickly and so it’s definitely a meritocratic environment and I just don’t think that they have that much success if it were based more just on contacts.
Dave Kruse: That makes sense and so throughout your career, you know, how did you continually improve, did you have your own systems in place or you know sometimes we go through careers and that might not necessarily really have a good system to keep learning but you know how to keep adapting to new technologies, new platforms …
Sean Ellis: Yeah…. So my goal when I was working with these companies, I spent about 4 years, well 3-1/2 to 4 years, where I was basically doing these short term roles with these companies. My goal was not actually to make money, mine wasn’t. I had too many things that drove me, reputation and learning and the only reason reputation mattered was that reputation opened the door to the opportunities where I could do the most learning and so it was all about learning and all about kind of figuring out what are the systematic things that I can do when I go into a company, how can I create something that will be useful in the next role that I have and so whether it’s pamphlet’s or checklist’s, you know, a better understanding of the tool to help me do this and so I helped get a bunch of different tools off the ground that made my job easier so, I was an early advisor to KISSmetrics, for example, previously to instrument the type of tracking that I could do with KISSmetrics in just a day, was taking me a few months and it was really kind of slowing down that process of getting started. A company called Performable that ended up getting acquired by Hubspot, was another company I worked closely with but basically, I was advising these companies so that they build the tools that I would need to be really efficient in the job so it wasn’t just discovering the tools it was helping to define those tools.
Dave Kruse: Interesting… Can you give us an example of like, Dropbox or Eventbrite or whatever is the best example of you going in and like… over those 6 month’s , like, what was your thought process and I mean that could be a whole podcast in itself but…
Sean Ellis: Yeah … but now, I mean, the first thing, I started out with a very qualitative focus so, what I was looking for were the people who were most passionate about the solution so they were, both companies were really pr-scaled to a larger guy; I joined Dropbox the week that they launched publically but there was enough people on the private data for me to basically dig in and see who was the most passionate in the way I would identify them is that I’d ask; how would you feel if you could no longer use this product and I was looking for people who say that they’d be very disappointed without it and once I’ve found those people then I really wanted to learn what made them tick, so, it would start with some interviews but a lot of surveying and so, I was like, one I would say, why would you be very disappointed and then I would ask what’s the main benefit that you’re getting from this product, why is that benefit important to you, why did you decide to try the product in the first place. I also, with Dropbox in particular, I looked at, I tried to identify who’re the earlier adopters and what was kind of motivating for them to try and so I asked the question which best describes you, I like to be among the first to try cool new technology or I only try things that would be useful for me and what’s interesting is that I found in the beginning about 80% of the people who were using it, the week that we launched were people who only, you know, who liked to be among the first to try cool new technology but by 6 months later it had flipped where 80% of the people who were people who only tried things that they thought might be useful for them and so a lot of qualitative and once I had their qualitative understanding then it was about, you know, just making sure that I got the messaging to match what their needs are along the way, that I’m setting the right promise for what the product is going to do for them and understanding where they’re having friction along the way of trying to get started with the product and I’m just making it as easy as possible for them to get started with the product and have the right expectations, so a lot of A/B testing and Visionet Systems that need to go in place to track and keep improving that flow.
Dave Kruse: And the messaging, would that be on the website and search engines and social platforms or where would that …
Sean Ellis: Mostly on the website.
Dave Kruse: Okay.
Sean Ellis: Mostly on the website, so I was trying to deal initially with organic traffic and you know, so many people get caught up in A/B testing where they will do website messaging that maximizes the registration rate, for example or even the clicksy rate for the next page but if they don’t … if that messaging is not accurately reflecting the real benefit that they are going to get from the product you’re converting the wrong type of people, you’re setting this false promise that the product will fail on it so that’s why I started with the most passionate customers first. I tried to make sure that I was really putting a genuine message out there that reflected what makes the product really great and is going to help drive conversions of people who would be really passionate about once they tried it.
Dave Kruse: And how did you get the… organic traffic, was that just PR or how is the traffic…
Sean Ellis: So yeah ! in the case of Dropbox and Eventbrite, they both have really good natural growth engines so in the case of Dropbox the number one source of organic traffic was actually just pure word of mouth, people who had passion about the product telling other people, but we also had anybody who was sharing files using Dropbox, basically it’s only once you receive that file it would be in a wrapper that promoted Dropbox and introduced them the concept of Dropbox and in that case…, to them I have to get inside their head and know the… for them right now this product looked like a file sharing tool period. It’s just a way for something to share a file with someone else, so nothing about collaborating on a whole folder or synchronizing your files between the computers, so I had to keep the message really focused around a used case that they were on-boarding through and then find a way to kind of gradually introduce them to the full picture of what the product could do and so that was with Dropbox and with Evenbrite, a lot of the traffic was coming in through, if I set up an event, and I invite, you know, 150 people to that event, then all of those people are getting exposed to Eventbrite and some of them are going to be event organizers and so again in both cases, there was pretty good natural organic introduction from user to user that really needed to be understood and then optimized.
Dave Kruse: That makes sense and do you differ companies that might not have quite as good organic or like that referral growth, I could say Qualaroo do you get more involved with the on-boarding or bringing traffic in or …
Sean Ellis: So with LogMein for example, we did spend quite a bit on ad words initially getting good people coming through, and I think the interesting thing kind of where the two tied together though is that with LogMein we were spending, frankly, we cut cost’s out the first time at about $10,000 a month that we could spend on ad words and just could not profitably scale it beyond that but when we looked at the numbers, you know, the majority of people who signed up for LogMein never actually used… they would sign up but not download or they’d sign up and download but never do a remote control session, so when we knocked up that funnel we realized that very few people were getting to be benefit of the product and if they didn’t get to the benefit then there would be no organic word of mouth coming off of that, they’d be no people who would upgrade to the premium version, like all of the value was based on actually experiencing the product so when we saw we had such a bad funnel we went back and I tried to understand why we were losing people, did a lot of surveying, a lot of a A/B testing and were able to eventually get about 1000% improvement in the percentage of people who signed up and ultimately used the product and when we did that, we went back to the same channels that we’d previously tested that scaled to $10,000 and now they scale to over a million dollars a month with positive return on investments so that money was paid back to them, and it was 3 or 4 months and so basically if these two things go together you can’t just stand externally and think it’s going to work, you need to be obsessive about every step of the customer journey until they have ultimately really get the benefit of the product and that’s where most marketers… most marketer’s kind of get into the front door and then they say okay now its production scheme, their products turned to figure how to turn them into value and so a lot of these prospective customers kind of, you know fall into no man’s land where no one is really focused on trying to get them into experiencing the product.
Dave Kruse: So, one more kind of, more personal question, so you’ve done a lot, have you had any major lessons or mess up that you’ve have learned quite a bit from or is it more of lots of little mess ups every day ?
Sean Ellis: Yeah, I’ve never had a mess up, it’s amazing, no I’m kidding, yeah.
Dave Kruse: You’re perfect.
Sean Ellis: Yeah am just 1000% all the time, I definitely, there a lot of tests that I do, I try to test them all, so I gave you one example of like, you know of spending the $20,000 on the first marketing spent but you know it’s how you learn from that and me realizing I don’t need to spend $20,000 dollars to know that a channel is not viable, I can figure that out on $500 and so even when my budget was a million dollars a month, I still never did any new media where I tested for more than $500 and if they wouldn’t go down to that size and then they knew they had no chance for my business and other channels were making millions dollars from us, which is what they turned from the $500 and, so I drove my agency crazy at the time when they were all happen to do those buys for us but I just said it’s crazy for us to spend more than $500 to find out something that does not work. So that would be one example early on, but I’d say like a bigger picture example, would be after I did these companies, where I was helping them go to market and you know, crank up that early growth, I then decided I was going to start my own company and, you know, apply some of those lesions to my own company, so I raised several million dollars for a company called CatchFree and it was based on, you know, of all the companies I helped bring to market, they almost all had this free to premium model where they had a free version that we were trying to move from a free version to a paid version, and I found that one of my big disadvantages was, you know, when I was trying to spend on advertising to drive customer acquisition, these companies were the big disadvantage because what they could pay to acquire a free user was a fraction of what somebody who only had a premium only business could pay, and so even though the users wanted to find these free products that, you know, there was this kind of like this mismatch in the channels to reach those users, so I wanted to create a channel that was exclusively available only through the free visit sites and that I knew how their business models work that they had an allowable acquisition cost, it was just a lot lower, so if I could kind of market them as a group I thought that would work well, I was able to raise millions of dollars on that pitch and it took me about a year and a half to 2 years, you know the team that I built for us to figure out that we had just some wrong assumptions in the business, one was that people only needed these free apps, you know, once every few months and so it was really hard to drive habitual usage, which is important in any business and then a lot of the customer acquisition that we are trying to do through Google, they had some rules of how you could spend money, so one, they ended up locking us for business stuff, what they call like a landing page business that they said was a __31:52___, so then we turned into a comparison engine, like completely rebuilt the site to be compliant with Google and then we ran into another problem with Google where they would not allow us to spend money on customer acquisition, and so anyways, I got to the point where it just became clear that it was not a great way to acquire customers, if we weren’t able to retain them on a regular basis, I still had enough of the money left from my initial fund raised, but I figured it was the right thing for the business to essentially shut that down and then we ended up acquiring a product called KISSinsights from KISSmetrics, where I had mentioned that I was an advisor and helped them initially get started with that product KISSinsights and it less core to their business and we had an opportunity to acquire it and then built that into Qualaroo, which is now a profitable business that, you know, the whole catch… I don’t really look at it as a mistake, I look at it as, you know, l learned a lot from it and I’m still in the process of building value for the investors who back me on that, so is it a big mess up, I’m not sure, but I think, you know, ultimately it would only a big mess up if I gave up after that, but you know, I put the money to work and I am confident that the investors who invested in that are going to do really well.
Dave Kruse: Yeah, that’s impressive, you know, you turned it into something else like Qualaroo, that’s not easy to do, that’s for sure.
Sean Ellis: No, in fact even with Qualaroo, once we got that to a profitable business then we started looking at it to see that it cannot give the big venture returns that our investors are expecting and initially something that had just been kind of a tactic for Qualaroo was GrowthHackers.com and we started looking at GrowthHackers.com and realized that there was a lot that we could do with GrowthHackers.com to turn that into a really big valuable business, so for a long time we have been taking the profits that are coming off of Qualaroo and investing into building Growth hackers, and I have now two separate teams and running them pretty independently.
Dave Kruse: Interesting, okay, and that’s the perfect segueway into GrowthHackers.com. Can you tell us a little bit about the GrowthHackers.com platform and may be from your definition of what Growth hacker is or I know there are a lot of definitions, but just for people out there if they are not too familiar with the term.
Sean Ellis: Yeah, so I’ll start with the kind of definition of what I think Growth hackers are, I made the word up so I guess I could be the guy who defines it, right?
Dave Kruse: Pretty impressive…
Sean Ellis: Yeah for me, it was basically, you know, if anyone seen a marketing text book, it’s usually, they are very thick books with a whole bunch of stuff that you could be doing and I wanted to do something that was more narrowly focused around what I found had direct impact on growth and so for me, growth hacking is really about using data and experimentation to drive growth, and so that’s kind of looking at everything that you’re doing to see how is that directly impacting growth and if it does not have a very clear direct impact on growth, then the growth team or you know, in an early stage company the growth hacker probably should not be doing, and so hopefully that’s clear in what I mean, it’s really data and experimentation to drive growth.
Dave Kruse: That makes sense, yep.
Sean Ellis: And so then.
Dave Kruse: Oh, go ahead.
Sean Ellis: Yeah, so GrowthHackers.com was basically built, as I said, it’s been an evolving business that’s come from, you know, seeing opportunity after opportunity, so one, we launched it with Qualaroo because we saw that when we ran Qualaroo on a marketing-related website, you know, the main way that Qualaroo spread to the other websites is there is a little link down at the bottom that says have you tried Qualaroo yet, people click on that, they get a promotion for Qualaroo and then they decide if they want to add it to their website or not, and we found not surprisingly that if you run it on Disney and bunch of kids clicking on that, probably not our web site, but they could pay for the survey product on, but if they have, you know, if they are a marketing-related web site, then they had a lot of the right audience that would be really responsive to that message and convert it into our customers, and so what we decided was that there was a good opportunity to build our own marketing-related website to really showcase Qualaroo and drive growth of Qualaroo and so it started out as really kind of like reddit where we were bringing together all the growth articles and marketing articles brought together where the community itself could vote up and comment and discuss things that were in these articles, and so, yeah, we initially built a community around that. One thing that we required was that everybody who was participating, they had to do it with their real name; they couldn’t come in and you know, call themselves Joe 1, 2, 3 and, you know, start advocating a bunch of illegal things or shady things that they had to at least stand behind it with their real name, and so overtime, you know, initially we just linked to their LinkedIn profile to verify who they were, but over time we have added rich profiles where it says a whole lot about the person and then, you know, what we found engaging with the people on the site one of the big benefits that they get is inspiration for things that they should be trying to grow their business, so just like years of just different, as I said, growth hacking is about experimentation and data, and experimentation requires lots of ideas for them to experiment on, so what we have now for the last year and a half been developing and it’s been private data for a year has been a platform for aggregating a backlog of ideas that you want to test, and then managing them through a testing process and building a knowledge base of what works and what doesn’t work to grow the business, and so over the next few weeks, I should be integrating that into the site and making it much easier to send ideas that you discover on the web site into your project, what we call growth hackers projects, and then you can invite your whole extended team in there so that they can submit ideas and really kind of manage that testing process and it’s modeled after how companies like Facebook, and Uber, and LinkedIn have grown their businesses with; in software development they have something called an agile sprint where they are actually running these weekly sprints of development, so a lot of these fastest growing companies run these weekly growth sprints where they are identifying experiments they’re going to run that week, they run the analyzed results, they learn to pick their experiments and it’s not continuous learning that has caused them to grow really quickly and so we are essentially productizing that process and connecting it into that, so it’s easy to build.
Dave Kruse: Interesting, and so what’s an example of a test case that somebody would submit to the community and how does that, do you actually connect with their software, how is it connected with their business and their platform?
Sean Ellis: Yeah, so everybody who signs up for growth hackers has a project that is provisioned for them already and so up to this point people who have been running experiments are basically doing it in spreadsheets, so they’ll write their idea on a spreadsheet, they’ll put the results in the spreadsheet, they’ll invite other people into the spreadsheet, sometimes they’ll link to an experiment document that has screenshots of it and so it’s kind of hodgepodge of systems, so this consolidates it all into a single system where you can visualize every idea in the background and so an example of ideas might be, one idea that we ran recently is kind of a checklist that we were inspired by something that Cora has done or LinkedIn has done, but basically a checklist of things to do when you come on to the website and what we know is that the key action that we want people to do is comment because that really connects to their long-term retention in the community, but comment requires a lot of thought, so we give them a couple of easy things like a vote first and turn to the other sorts of things, but yeah, visit this page, vote on this and once they got the check boxes there, it is easier to push comments and then what we know that once they do the comment that they are much more likely to come back more often and so that will be example of something that we’ve done recently that increased comments by 700% for us and was really modeled off of something that we have seen other sites do.
Dave Kruse: Well, yeah, so you are going to have quite the database and knowledge base over time for your growth. What’s your business model?
Sean Ellis: So, if you want to do it publically, if you are just saving ideas that are already public in the community, you are just looking for a place to save them, you can do that for free. Even if you want to manage with testing and record the results, you can do that for free, but if you want to do it secretly or privately which, you know, most bigger companies are going to want to do, then it’s a monthly subscription fee, so they can lock it down and do it privately.
Dave Kruse: Interesting, I was curious, so how many people are on the platform and how do you know who is on the platform, like, I mean, how good they are, and then what are like the primarily skill sets for a growth hacker?
Sean Ellis: Yeah, so that’s kind of the beauty once you have work flow in there that, you know, right now it’s the same way like with LinkedIn or any time we have a profile, you can say you are good at whatever you want to say you are good at, but you may or may not be good at it and that’s been a big challenge with marketing people or growth people that, you know, it’s really hard to separate who’s good and who’s not good, and what’s nice with the system, we’ll let people’s stuff identify expertise in free areas, but if they want to add additional expertise areas, they have got to earn them through their experimentation in the system.
Dave Kruse: Oh, interesting.
Sean Ellis: And so, yeah, so then it’s just a matter of, they need to actually run and get from an experiment in that area to be able to claim that as a skill and so what we have is, we have about 160,000 registered users in the system right now and then for the workflow itself, we have 7000 companies that have signed up for access to it, we have opened it up to probably 1000 companies at this point, not because it has been a private data, it’s never a company which is still on the waiting list.
Dave Kruse: Interesting, and we are running out of time, and I still have more questions, may be a couple more, or may be more.
Sean Ellis: Sure, no problem.
Dave Kruse: What differentiates an average growth hacker compared to an exceptional one?
Sean Ellis: So it kind of depends on the company stage, so if you are in a really early stage company, then you want someone who is super dynamic who can do a lot of their own implementation of their own ideas, you know, they are just coming up with ideas all the time and they are channeling them into an engineering department to implement, then they are probably not going to be that effective because in a real small company your engineers are often building core products, so in an early stage company a lot of times somebody will actually have engineering background, they are tenacious, they are dynamic with a pretty good skill set so they can go deep with the data, they are familiar with tools like Optimizely, so even if they are not an engineer, they can at least set up a lot of their own A/B tests, you know, something like Optimizely which isn’t that hard to do, but you know, it is just a matter of, you know, it’s not just the knowledge of running the test, but it’s also the creative power of coming up with a good idea for the test and then the, you know, discipline of learning the test right and analyzing it correctly, acting on that information, having that lead to more and better tests, so it’s pretty hard to find the right profile in a super early stage company because the person needs to be so dynamic, but as you grow as an organization, then it’s really, you know, like for us we have a product manager of growth who is managing the process, whose essentially bringing ideas in from across the company, running our weekly meeting where we are prioritizing which ideas get tested or finding those ideas out to the right people to actually implement them each week and as a separate analyst who is running the analysis and so then it becomes more about, you know, what’s the right type of engineer to have in the growth process, what’s the right type of analyst to have in the growth process, and where do the good ideas sit within the company, and the product manager of growth or sometimes called growth masters, some people just call it the growth hacker, would be really more of a coordinator and usually comes from a product management background and hence kind of keeping the whole thing organized.
Dave Kruse: And who is typically on the team, you know, you mentioned like the engineer and who else would be on that kind of growth?
Sean Ellis: So, engineers, designers, analysts, marketing people, marketing will often be where the copy writing will come from and then, you know, in our weekly growth meetings, I as the CEO, I’m participating in most of the companies that I see doing well, like if they are sort of less than 50% company and they are having 1 weekly growth meeting, the CEO does participate, and your Head of product, and your CTO, because you know, the CEO’s main responsibility is driving sustainable growth and so they should be a part of that process and, then you know you get to 1000 people or more, may be the CEO is not in there on a weekly basis, but I probably would navigate even in the company of that size that CEO’s should be pretty hands on when it comes to growth.
Dave Kruse: Interesting. That makes sense and where do you see growth hacking going and, you know, I think it’s become a little more since you coined the term, what year did you technically coin the term, do you remember?
Sean Ellis: 2010.
Dave Kruse: 2010? Okay.
Sean Ellis: Yeah, 2010.
Dave Kruse: So I mean things have been a little more systematic. It seems like you know, they were probably not necessarily growth teams back in 2010, and at least not in the same way.
Sean Ellis: Yeah, they were like, Facebook started their growth team in 2008, so they were around, but they were kind of under the radar, most people didn’t know about them.
Dave Kruse: Okay, and so where do you see the kind of growth industry going in the next 3 to 5 years?
Sean Ellis: I think, so Harvard Business Review actually just posted an article within the last couple of weeks called the “Growth Manager” that really laid out what the role looks like, whose managing the growth process and, you know, what the right organization looks like for that, and that was based on a big study that they did that they are now teaching at Harvard Business School about how the growth process works and what a growth team looks like, and so I think, you know, as the business schools are starting to teach it, it is going to become more mainstream, but already as it is IBM has a VP of growth, who I have actually been in contact with through the day, Microsoft has a pretty big growth initiative and their CEOs have talked about growth hacking quite a bit, and they are a lot of people are looking at the fasting growing companies in history that, you know, the slacks of the world and the Facebook, LinkedIn and Uber, and just try and understand how they have done that and a lot of it has been through product driven growth that is often not by accident, that it’s through a lot of testing and optimization where they have got big growth teams that are working in a very systematic way to drive that growth and so when you have that kind of success, it’s not surprising that lots of companies are looking to emulate that and so I think we are just really on the front end, so it’s like if you use Google trends and you plug in growth hacking, you’ll see that the growth of the term itself is at an all time high right now and it’s still on a very steep trajectory, so I think we are still in the early days of more and more companies adopting it.
Dave Kruse: Do you wake up every morning and say, yup, I invented the term, I would if I was you.
Sean Ellis: It is usually just Saturday’s,
Dave Kruse: Saturday’s… do you have a ceremony?
Sean Ellis: Yeah exactly….. part of it to be honest, part of it is kind of with mixed feelings on the term because there is a lot of people who got excited about the term when I first came out with it kind of assign their own meaning to it, a lot of new graduates who had never grown anything or worked in the industry started putting it on their LinkedIn profiles and so, I think there is a lot misunderstandings about it, and you know, there is some negativity, but you know, at the end of the day I don’t really care that much about the term to me, it’s really the process that leads to the result that matters and people can call it whatever they want.
Dave Kruse: True, true, and we are almost done here. So have you, for a business, we talked a lot about kind of B2C business consumer companies. What about B2B, I assume the same types of theories apply… have you worked for any B2B companies and, you know, should they be looking at some things differently?
Sean Ellis: Yeah, while I mean, Qualaroo is a B2B company.
Dave Kruse: Yeah, I guessed right then, yeah.
Sean Ellis: Yeah and then, I mean even LogMeIn had a lot of B2B products in their business and what you see with companies like LogMeIn or Dropbox is that they are sort of direct to consumer piece of the business, there is a lot of the engine of growth that leads into be B2B business, and so I think that the hybrid companies have done really well, so if you compare box to Dropbox, box was kind of like pure B2B, and Dropbox was more B2C and B2B, and the last I knew, I think Dropbox was about somewhere between 5 x and 10 x evaluation and they started about the same time, so I do think that having that kind of consumer bottoms up approach and B2B can be really powerful.
Dave Kruse: Yeah, that’s fine. So last question, is there one company out there that you would love to help advise that you see out there that you can help grow?
Sean Ellis: Oh, yeah.
Dave Kruse: Any product you’re using or….
Sean Ellis: Sure, yeah, for me it’s really all about learning and so I need to look more where I would I be able to learn the most and it would be from the teams at either Facebook or Uber, I mean some of the companies that have figured out how to get 200 to 300 people on a growth team working really well together and, you know, driving continuous growth at levels that we have never seen before, I think there is some really cool stuff that’s going on there and I would love to have, you know, a least a month of being able to be immersed in there to really learn from that, I will have a hard time leaving my own business to go join a team like that, but you know, if I wasn’t doing my own thing I would be all over trying to get on board with a company like that.
Dave Kruse: That’s interesting, that wasn’t the answer I expected, but I like that, I mean, especially with your experience where you have done at a very early stage, so I can see you setting up a team of 200 people growth team, that’s another whole level, that’s interesting.
Sean Ellis: Yeah. Most definitely and that’s the area that I’ve been most focused on learning about for the last couple of years and it’s pretty fascinating.
Dave Kruse: Okay. Well, I think that’s it. We definitely appreciate it Sean, it’s been awesome. I love your philosophy around, you know, every project should be about learning and yeah you’re a great asset for the growth community.
Sean Ellis: Thank you, I appreciate it Dave. Thanks for having me on.
Dave Kruse: Yeah, and thanks everyone for listening to Flyover Labs, and we’ll see you next time. Bye everyone.