How to grow your startup - Ex PayPal growth strategist Matt Lerner

26:23As a hiring manager, what is your approach on it? What are the cues and things you're looking for behaviorally from the person? Like, for example, is it a red flag if they just come back with a perfect answer or do you actually want them to sit and think? That's exactly the right question to ask me right now. You're exactly right. Because how they answer it, how they react to being put in that situation tells you everything you need to know. You may not have a failure teed up because you didn't know that was going to be an interview question, but does the thought of talking about failure in an interview frighten you?

26:56Do you get defensive? You know, everyone's got a story teed up about like, tell me about your weakness. Do you give me the bullshit answer, scripted answer to a different question? Or do you stop and think through it and come up with and remember a mistake you've made? And then you also know what you've learned from it because you already thought about that when the mistake happened. So, so much of what you're looking for is not the answer, but how they think about it, how they react to it. And you can learn a lot by someone by like, what do they consider a mistake? Some people say, you know, my mistake was I let this campaign go out with all these typos in it.

27:31That person isn't what you need in a startup. Typos are not the difference between your startup succeeding and failing, right? So yeah, so much of it, you're right, is down to how they answer it. as you know, because you help Joel and I, we're interviewing a bunch of people for head of marketing role right now. Um, and found someone I really liked. Admittedly, I liked that person slightly more than Joel. We, you know, gravitate more towards certain things. Um, but I, I, I thought he smashed the interview. Um, and then the presentation was brilliant and you could just see, I felt how hiring this person, he just knew what he was doing and had a lot of the relevant experience and the playbook and the answers.

28:11It was great. And then we asked, give us some examples of feedback that you've received in the past. And literally nothing, not like he couldn't remember that he'd not had feedback or whatever. It was maybe the only person I've come into contact with in a professional environment who couldn't get their head round at all the idea that they've ever received any. It was bizarre. It was like, no, I mean, I'm just really good at my job. It's never really happened. And we were just trying so hard. Give him an hour or something. We really wanted, I mean, I really wanted to hire this guy. And at some point it just got embarrassing where I was basically trying to answer his questions for him.

28:54I was like, you must have had some kind of feedback. Nothing. That's astounding. maybe 15 years in loads of great brands and couldn't remember a moment anyone had given him feedback. Well, at least he didn't make it hard for you. Back to your humility point, wasn't quite the perfect fit on humility, which is actually one of our company values. And it was a big shame because everything else was perfect. But back to this point, there's two things in startups, right? There's can you do the job? What are the right questions to find out? Can you do the job? Can you grow this startup? up and then there's also are you going to be a culture fit and i think if feedback and humility is part of your culture then sadly can't have one without the other i think humility has to be part of your culture in an early stage startup because whatever you believe and whatever you told your investors if you're not growing you know 50 month on month you're wrong and if you can't even acknowledge you're wrong you're not going to figure out the right answer okay so traditionally startups that aren't growing, they're kind of dying one way or another.

30:00And as a bit of a brutal way to look at it, but sort of the definition of a startup in many sort of ways is, you know, a growing thing. Otherwise, as soon as it flatlines and growth starts to stagnate, you're kind of screwed. Don't equivocate. You're exactly right. Right. So if you're not growing, you're dying. And so you have experienced companies that have died and have failed. what causes startup failure what causes startups to die i mean you've got an entire series of podcasts about failures i don't need to tell you there's a lot of reasons it's sort of like it's the first line in anna karenina where it's like happy families are all alike but each unhappy family is different right successful startups are all alike in this kind of fundamental way and the failures fail for so many reasons so just because we don't have eight hours i'm going to focus specifically on growth and that piece that we're not going to talk about that co-founder getting rid of too much equity too early like supply chain cash flow all the other reasons but in growth what i noticed were sort of three patterns of failure and they all come back ultimately to the founder's personality because you know we listen to our podcasts and we do our huberman protocols and all the stuff we're supposed to do but then you know when we're stressed and when the chips are down, we tend to revert to type.

31:19And so type one are overthinkers. And these are people, you know, and it makes sense. I understand their point. Measure twice, cut once. You don't get too many bites at the apple. Let's consult people and think through a strategy and do the right thing, right? Figure it out. But the problem is all that debate and discussion comes at the expense of action. And there's no one you can ask who's going to know the right answer because you're doing something no one's ever done before. The next ones, I'd call them underthinkers. And these are people with a bias for action, which, again, in a startup is a good thing.

31:49But like you said, if you've got a list of 100 things, why not go do 100 things? Because the potential solution set to how your startup is going to grow is so vast, you just can't brute force it. So you've got to narrow down the list. There has to be some strategy. And so people who just build, ship, build, ship, build, ship, end up with this really complicated product that's hard to maintain and has very few customers. And the website says, you know, all in one, blah, blah, blah, because they can't even describe what the product does. And then the third one is this sort of this hire and delegate.

32:18You know, a great leader knows their skills are limited and they want to hire the best people in each role and delegate to them. And those all sound like very sensible strategies. And in an established company that works, they are. Because you know how your company grows. You know what you're hiring for. You know what work you're delegating. But in a startup, you're in a race to figure things out before you run out of money. and if your goal is information acquisition hiring and delegating is a very slow way to learn anything building and shipping products is a very slow way to learn anything and sitting around and debating and discussing with experts is an incredibly slow way to learn anything so what you want to do in a startup if you want to learn as quickly as possible is go back to this process of rapid experimentation of understanding your growth model of listening to your customers so to summarize all of the big mistakes around growth end up preferencing some form of procrastination over actually getting out there and doing validated learning as quickly as you can.

33:13So in your view, like to build a successful startup, does growth kind of go at the top of the whole pie? As in obviously, you know, from a professional point of view, you're going to say yes. But like just strategically, based on the fact that a startup exists to grow and make money and happy customers and all of the other things that are like very broadly, we understand to be somewhere around how to define the North Star metric, but you need money, you need customers. And if you don't grow, you die. So is growth the single most important thing at a company? I mean, most failed startups have a product.

33:50Most failed startups have a team, a good team. The one thing that failed startups consistently don't have is growth. And do you believe that the core to unlocking that then is like a system, essentially? Yeah. I mean, I called my company system, so that kind of shows my bias, but it's a process and a mindset. Yeah. It's a process of gathering information and validating it quickly. And it's this mindset that I don't have all the answers, but I can figure them out. if you've got co-founders it's probably quite nice to have the idea of balance right so at heights i would say joel's the overthinker and i'm the underthinker and you could maybe find examples where it's not always true but broadly i'd say that's fair um which is why i asked why you can't do all 100 things at once because you know only an underthinker would think that way uh what are you i'm an overthinker you're an overthinker 100 okay and where do you find the balance between these things like where does it sort of even out into like actual practical picture I do think some brilliant talented people are both.

34:51I've seen them, but they're rare. So I think the first thing is to know, just as you said, to know yours and balance yourself out, surround yourself with people of the countervailing bias. So my co-founder is an underthinker and we call each other out on it all the time and it keeps us on the straight and narrow. Ultimately, are you validating and learning stuff every week? If you're doing stuff and not learning from it, you're probably underthinking. And if you're not doing stuff, you're probably overthinking. if I was to type in startup growth onto YouTube I'll get a lot of videos if I type it into TikTok I'll get even more um it's easy to find insight and information from people about how to grow a startup so I come back to that there's a Derek Sivers quote um which is something along the lines of if uh more information was the answer everyone would be a billionaire with six packs so So on that concept, we have the information about growth everywhere.

35:49Every startup founder can easily access this through podcast courses, whatever. ChatGPT. ChatGPT, right? Could be your own little growth assistant partner. So why aren't they actually doing the things? And why are so many startups still dying, even though the information's out there? You know, I wrestle with that question all the time. Like, think about the stuff that we, what have I said? What revolutionary secrets have I given away on this podcast? track if you're delivering value to your customers find your you know your metrics focus on the bottleneck listen to your customers does any of this sound heretical like this sounds like the most obvious stuff in the world but people don't do it and i think a lot about why and i think ultimately and this is going to sound cliche so i'm going to drill into it but it does come down to mindset now everything we've done in our lives has conditioned us to want to be right and good You get good grades in school, nice job, Danny.

36:45You get to go to a nice uni, nice job, Danny. Did your A-levels, whatever. You get a job in, you know, consulting or banking or marketing, and you do all the things and make no mistakes. And then, and that's what gets you ahead in your career. And none of us like to make mistakes, and none of us like to talk about them. And then you get into a startup, and the game is rigged against you. But you don't know it's the, with the Kobayashi Maru problem, like there are no right answers. and people who aren't comfortable with that and people who aren't comfortable making mistakes and talking about them aren't going to be able to succeed because they're going to be trying to look at the numbers sideways and convince themselves it worked and come up with stories and bullshit themselves to a point where they're not learning.

37:24So there's this huge mindset shift from trying to do all the things perfectly to just trying to move quickly and figure things out. And people really struggle with that. I think entrepreneurs, just purely by natural selection, tend to have that. to some greater or lesser extent. They have humility. They know this thing or that thing. But getting that in a team is really hard because you've just hired someone, right? Because they went to a good uni and they got good marks and they got promoted in their last job and they did or didn't get feedback in their last job. And now you want them to come in and screw up a bunch of stuff and make mistakes and talk about it.

37:57And they're not going to want to do that. So you have to create an environment where, as a leader, where that's okay. and so how do you do that well first of all you lead by example right as a leader talk about your own mistakes um talk openly about them talk about what you learned second is how do you react when someone comes to you and tells you they made a mistake do you blow up and freak out and fire them or do you say okay what did you learn you know what can we do what are you gonna do differently next time right you don't fire someone because they made a mistake you fire someone because they were a bad hire in the first place if they're about higher in the first place that's a different an issue, but a lot of times good people make mistakes.

38:33How do you handle that? And then I think the last thing is asking the right questions. So if I want people to focus on data and customers and experimentation, I'm asking people, what's the most important work we're doing right now? Which work should we focus on? Walk me through the math and help me understand why. What's something a customer told you that surprised you lately? What's the last thing you heard from a customer that has changed how you think about the business? So ask questions where the right answer is, I don't know, let me figure it out. Or it's some kind of learning. And is part of that process then just a bit like the person has to come up with you with the structure of how they're going to ask the questions and the structure of how they're going to find it out?

39:12Is that sort of the key insight around that mindset? Well, I mean, in an interview, absolutely. I would hope by the time they're working for you, they've already got some kind of structure and process around that or you've given it to them. Yeah. One of the challenges I've experienced at Heights running through your process is actually being in a regulated industry. And so you have a lot of the very classic stuff of you need to put the words on your website that your customers are using. And we're like, we would love to. However, we can literally not publish positive reviews that talk about any health benefits.

39:45I'm sure it's the same in finance and other regulated industries, but I don't know them. In health, the long list of the things you can't do are longer than the things you can. So how do you go around problem solving in those kinds of situations? So you need to do it. The good news, first of all, the good news is when you overcome that hurdle, it becomes a moat around your business. When you can overcome that and do it well. So one example from TransferWise that Nilan, the head of growth there, told me about was, you know, onboarding someone to a fintech product requires all this KYC stuff and disclosures.

40:17And it was a horrible customer experience. So they actually focused the growth team on improving the onboarding and KYC process and got that to a point in some countries they were required to do it in person they lobbied the government got permission to do it online like and once they were able to overcome that process it then became a huge competitive differentiator for them like one two three you're onboarded we worked with a company called stepladder that's also a fintech product and they have to make it helps people save up enough for a down payment on their first home like property ladder and again And the FCA or whoever made them disclose all these terrifying sounding things and give people a questionnaire.

40:56Do you realize you could lose all your money? And that became their growth team's main focus. And they spent months testing and optimizing every question, every step of that flow, so that they were remaining legally compliant by getting people over that hurdle. Their business is growing very quickly. It's become profitable because they were able to do that. And that's now a huge differentiator for them. So you've got to do it. but then that becomes your rate limiting step, right? That's what your growth team has to apply their superpowers to. Okay, so I know you're obsessed with growth. I know that you think that the answer to everything in startup land is growth.

41:33Where does brand fit into this picture? Like, is there a limitation on where growth can really take you further? And at what point does brand need to step in? If you've got another hour, let's figure out what do you mean by brand? I knew you were going to ask me why I meant that. So, I mean, you can answer it if you want. But I think that is the problem, is people throw this word around, and it means all kinds of things. I suppose brand is similar to reputation, right? It's what other people say about you or how other people describe you. What people say about you when you're not in the room. Correct.

42:03Yeah. Okay, so when you talk about a product and they're not in the room, whatever you say about them, good, bad, or indifferent, is it because of the way their logo looks? is it because of the adverts that they put on the side of a bus it's like our experience of products and services is what dictates what is a brand and you can as in customer experience like yeah our your experience the customer's experience of that product dictates the brand now in the beginning i think when people think about brand it's like i have a new product new unknown product maybe it's like a high trust category like health or financial services and we need to win people's trust quickly now that's a specific challenge and when you get to the other side of it everyone's like oh you have a brand but doing a bunch of advertising is a really expensive inefficient way to get to the other side of it so ultimately when you trust a company you don't just generally these are nice people you know i'd give them my money or my children or they let them babysit for me you're trusting them to do or not do a very specific set of things and so you need to understand you know like what is it for your product that people are trusting you to do so for your product i don't know what is it it's like really high quality ingredients that have been scientifically validated that are actually going to work and make a difference for me in my life um you know if it's a bank they're trusting them with completely different things you're not going to get hacked or go out of business or you know be an evil big company and steal my money or whatever So you've got to understand, what are your customers' really specific exact anxieties?

43:43And how can you address them just as those ideas, anxieties pop into people's heads? 2024, AI is obviously at the top of the stack of things that people are using in terms of useful tools. What are the actual practical tools that people are going to be using in growth teams or one-man bands, whatever it might be, your typical customer base? how they're going to grow their startups using AI tools? I don't have a great answer for a list of off-the-shelf ad tech AI tools at this point, to be blunt. How are you practically using it? First of all, talking about AI tools, you said something earlier, which is like, if missing information were the problem, then there'd be 100 billion more successful startups.

44:30ChatGPT will give you information. What you do with it is completely up to you. You know, with my team, we have coaches, we work with companies. We help them find the right answers. They find the right answers. Most of the time, half the time, they still don't follow through. They still don't execute. So I think AI can only, giving you the right answer can only get you so far. The other piece of it is that it's just very quickly automating some tedious parts of the job. What I've seen from most, and that's excellent, you know, working through large data sets, testing stuff, automating repetitive tasks so you can move a little faster.

45:07What I've seen of the actual work product of things like MidJourney or GPT-4, if you're looking at actual copywriting, there's no longer any excuse to be bad. So I think this can get you to 70 % good or 90 % good. But you can still tell when a post is written by ChatGPT, right? You can still easily scrolling through any feed. Oh, yeah, that's a MidJourney image. that's an ai created image whatever so there's you know but in social in marketing in any communication venue in any startup there's this 90 20 or really like 99 one like in all my linkedin posts last year i think 80 of all my likes and follows and everything came from like the top five percent of posts and those top five percent that real genius right now so far is not coming from AI.

45:56So I still think to do really great work, you know, a skilled practitioner with some help from AI, but ultimately so far, at least for the next six months, you still need that human layer on top of it. Okay. So AI can only really help support growth, but it can't really do any magic for you just yet. Well, I think it can make you more efficient. I think it can absolutely raise the basement, like raise the floor up. But yeah, I still think right now the exceptions are exceptions. They're purple cows. Typically speaking, growth channels in startups usually revolve around Meta and TikTok. What else do we need to know about?

46:31What are some interesting, actual, practical channels that you've used with your audience? Yeah. So there's whatever there are, six channels, BD and sales and cold email and meta and inbound and blah, blah, blah. But if you look at the examples in my book or any of these great examples, it often it wasn't so much a specific channel it was really the formula for how to do that so it's like of all yeah tiktok sure but what actually goes viral on tiktok is your audience on tiktok what goes viral among your audience what goes viral among a subset of your audience who will then subscribe and use your product so you know it's a pretty easy sort of mathematical equation to figure out which channels you should be playing in if you can avoid paid channels entirely obviously mathematically that's better but you know 90 of that battle is then figuring out and validating are my customers on there you know is anyone searching for the you know the question that you are the answer to no then adwords isn't a channel seo isn't a channel for you and then so much of it is then figuring out who are these people how do i find them what sort of content resonates with them the people that's bringing are they qualified will they pay for my product will they remain loyal so 90 of it's really just testing down into that stuff and A lot of the great examples that we've talked about in these big unlocks aren't a specific channel.

47:53They change their text in the App Store and 4X downloads. What channel is that? There's another channel. I think that sort of channel focus tends to blind people to a lot of the breadth of the opportunity. Right, because there's little moments along the customer journey, and each one of them creates another unlock. That's the thinking that you're trying to encourage people to have more of, right? Yes. I'm a new startup. I come to you. and I say, Matt, give me two to three minute spiel on how I'm going to grow. What do you say? Like how you should approach growth? Do you have a product? Do I have a product yet?

48:30Actually, I mean, let's assume most new startups are going to be building AI driven B2B SaaS. So assuming you've got a product live with customers or it's in development, like what stage are you at? Great question. Really should have thought this one through. Um, let's do what, how about we try and market your book? How are you going to market your book? That's a product. And it's actually quite an old school product. So probably quite as in as an analog and everything else. So sell me this pen. All right. Well, do you want me to sell you the book or do you want me to, I just send it to you? Yeah.

49:05Amazingly. You read it. That's the extraordinary business model that you hand deliver books. Uh, don't recommend that as a growth lever, but anyway, tell us how let's use the book as an example. Cause, and I think what's nice about the book is it's old, it's analog, it's not shiny consumer. It's not B2B sass off the shelf. It's probably quite hard. How would you sell it? So yeah, same rules apply. I mean, it's just me and my co-founder. We have one employee and I'm running a business. So I'm looking for the 90, 10 year. I don't want to do stuff that's not going to work. I'm not flying around the world and book tours and trying to get into bookstores.

49:37So who are my customers? They're entrepreneurs. So they're very time poor and they have specific questions they're trying to get answered. So I'm trying to do a handful of the highest impact things. So first is building my audience on LinkedIn and my subscribers in my email. And I do that by posting things that I know my readers care about so that they'll follow me. The second piece of that is getting on podcasts because I know my customers, my audience listens to podcasts like yours. They generally, because they can do it while they're multitasking because they have ADHD and they can't sit down and read a book, etc.

50:12So that's going to be a big piece of it. Um, some of them go to events. So I may end up speaking at some events and giving away books, but you know, the last place any of them is going to go is water stones or Barnes and noble. So really in terms of distributing a book, it's all about Amazon. It's gotta be an audio book form too, because a lot of pod or a lot of entrepreneurs would rather hear content than read it. But yeah, that's basically, that's like the, the 90 10 playbook for how I'm going to market my book. We'll see if it works. What, what about that as the 90 10, As in that's a bunch of tactics.

50:45Are you saying that you believe that one of those things is going to drive 90 % of the growth? It's really just three tactics, right? It's build my own audience and sell it to them. It's get on podcasts. And it's maybe speak at some events and give the book out at those events. Got it. And the devil's in the details. Like, what conference am I speaking at? What am I talking about? What podcasts am I going on? What posts am I making on social media? How am I positioning it? Yeah. so coming back to the mindset point you were saying earlier how much of this do you think then is um simon sinek has a great phrase i've really enjoyed trying to reframe my own positioning on everything around which is the infinite game okay so he talks about the people that can approach their products their business their content or whatever like an infinite game it doesn't really matter if this particular episode gets 100 ,000 downloads or whatever.

51:39If you stay in the market for long enough and you care for long enough because you're enjoying it and you're playing the infinite game, there's no end to this game. It's your life. If you take that approach, things will go exponential because most people just give up. Yes, startups fail, but people also give up. They give up their motivation, etc. Your own 90-10 thing here actually didn't sound like a bunch of quick wins at all. It sounded like a committed approach to being in the market having a plan and staying power. So is that also sort of the sad non-hack of growth is just the willingness to turn up every day and keep at it?

52:16Broadly it is. And with my business, I'm at a stage in my life where I'm on that kind of infinite game. Like what kind of business do I want to build? Who do I want to spend my time with? And what kind of work do I want to be doing? Startup founders don't always end up in a position where they can play an infinite game just because of financial resources. Okay, so you mentioned Northstar metric. Sounds good. We've sort of discussed, you know, what they look like, but how do you actually find it? Now, how do you know that one is a Northstar metric and the other is not? So your Northstar metric, first and foremost, is going to be a number that increments when you deliver value to customers.

52:52And, you know, if you can't specifically measure it, you can't measure if someone's sticking one of your pills in their mouth or not, then you want the closest proxy to that. Typically, in a consumer business, it's going to be people repeat purchases or, you know, people continuing their subscriptions. In software business or an app, it could be daily, weekly, monthly active users or whatever their natural behavior cadence is. Or it could be some sort of amount of usage. You know, Amazon Web Services is probably like server cycles or amount of storage or something like that. How do you decide if it's a number of users or the amount of usage?

53:28Typically, if the business is highly concentrated, if most of your revenue comes from a handful of whale customers, like online gaming, then you're going to want an amount of usage because one person who walks into a casino could be worth a thousand times more than a different person. If your customers are all comparable value, like heights or meta, then, meta on the B2C side, on the consumer side, then you're going to want like a daily or monthly or weekly active users type thing. And if someone comes to me, I think this is my North Star, what do you think, Matt? The way I'll stress test this is I'm going to say, can this keep going up every year?

54:04Because some people will choose a ratio like return on ad spend or activation rate or retention rate. And that, or net promoter score, once that gets to whatever, 100%, it won't keep going up. But your business needs to. So I'm looking, is it an absolute number? Does it encompass the entire funnel? Is everyone in the company's work some way, primary or secondary, supporting this number? and then the third thing I'm going to do is just like a mental stress test of like could this create perverse incentives can I think of a way you know I put on my naughty you know school kid hat can I think of a way to gain this number where I hit it and the business actually doesn't grow or not so those are like the main stress tests I'll use to see if it's a good north star fundamentally though just the sorry the one qualification is if your business is immature if you don't have product market fit you don't really know how you're delivering value to customers, it's not fair to stick a pin in a North Star metric.

54:58So it can just be a hypothesis till we bottom this out. But if you have a mature growing business, then it's time to settle on a North Star. Sorry to interrupt. Right. And so you're saying that once you have it at a certain point, once you have it, you should really stick to it. Are there exceptions to that rule? Like, should you change it at some point? Like, do you really imagine that Metas is the same now as it was then? Metas, I think it probably is. But I realized, as I said, it was a bad example, because it almost definitely will be. Well, I mean, there's a famous, I don't know if it's a legend or what, but Meta, you know, their North Star was always daily active users and TikTok was minutes of scrolling.

55:35And you, you know, you get the thing you incentivize. So if Meta gets everyone to log in and use the product for three minutes a day, like Duolingo and TikTok becomes addictive and gets people to keep scrolling minute after minute, well, you see how that movie ends, right? So it shows that North Stars, even in huge companies, have incredible power. but back to your original question um when would you change it if your business fundamentally changes so when amazon launched aws you know then repeat purchases on our e-commerce site was no longer a sensible north star they have a different one for aws or if you learn something fundamental about your business and your customers so hubspot i think was using daily or weekly active users and then they changed it to weekly active teams because they figured out individuals who use the product have a high churn rate.

56:22And they're really only delivering value when they enable collaboration. So if you learn something fundamental about how you deliver value to customers, that's the other time that you can have permission to change your North Star. I mean, the late, great business guru, Charlie Munger, said, show me the incentive and I'll show you the outcome. Is that quite a good parable, basically, for the North Star metric? That is literally the quote in the book that sets up the metrics chapter. that's it and because if i could elaborate a bit on that if you hire people they're going to come in and they're going to want to do best practices of their job right your compliance person will want to be perfectly compliant your salesperson will have sales targets your product person's going to have product targets and your engineers are going to want like no bugs and fast cycle times or whatever engineers care about so everyone's pulling in slightly different directions and with this north star you say look our mission everyone in this company's job is to make sure that people are using our products and getting value from it every day.

57:20That's your job first and foremost. How does your work compliance person, engineer support that? And then they're going to refactor how they think about their job and start to sort of balance the best practice metrics for their discipline with the business outcomes and the customer outcomes you're trying to achieve. So classic underthinker question here. I have a hundred things I want to test this week. I'm excited about all of them, of course, because I only have one mindset, which is pure hope that they're all going to work. What framework can I actually go through to take me down to reality and start actually practically growing my business rather than getting overwhelmed by the 100 things and getting all excited and not taking action?

58:00All right. Yeah, everyone, progress is deciding what not to do. So I think that was Jack Butcher said that. So the first cut on that list of 100 is which of these will affect your rate limiting step? Maybe 30. So that's like the first exclusion, right? Then the next thing I'm going to do is I'm going to look through these and say, for each of these ideas, quick back of the envelope, if this works, how big can it be? And if this works really well, it can only increase our business by 2%. Like it's off the list. So now only choose the things that could be big. Now I didn't say effort and impact.

58:34I just said impact. Which of these things, if it works, can be really big? Still, you can only do a handful of them. So I'm looking at these and saying, which of these, given the resources we have, could we quickly execute this week? Which of these will we learn something useful even if it fails? Is there a debate we've been having in our company for the last few months and it feels like Groundhog's Day and I just want to bottom this out? So I'm looking at which of these experiments can we learn from? And then I just try to write a hypothesis for each of them. And some of these I can't even come up with a clear hypothesis for.

59:06And it's like, well, you know, maybe my thinking is not that clear there. or we'll never be able to measure that actually anyways. Or now that I write the hypothesis, I realize a better way to test that would be doing this other thing. So that's how I narrow down the list. But ultimately, if you're running this process well, you're running experiments every week. So if you don't run the experiment this week, you'll run it next week or you'll run it in week three. So don't spend too much time overthinking. You probably won't, but to your listeners, don't spend too much time overthinking exactly which experiments you run.

59:36Just get to testing. So there isn't necessarily like a framework on like ease versus speed versus like any of that stuff. It's more like resources and which ones feel right. I mean, people talk a lot about effort versus impact. Yeah, like ice framework and stuff like that. Exactly. But then you end up with, you do all the ones that are like big impact, low effort, and then you end up with all these high effort ones. And it's like, well, we want to commit the resources and the hires and nine months. so take the ideas that are high effort high impact and do a minimum viable test so don't do the whole thing just say you know okay seo to do seo well takes months to build domain authority years to do it well hiring you know it's expensive etc but you can validate it pretty quickly you can see if there's search volume for these terms you can build a landing page and buy traffic to it and see if those people will convert and if they're good customers for you.

1:00:30So there's things you can do in a week to validate a big idea before you do it. So for those ideas, just do that minimum viable test. There's lots of different things that have been discussed here. What's important to me is sort of listeners being able to take away an understanding top to bottom, height alone. What are we doing? Like how are we actually mapping out this process? So almost like the chapters in the book, right? So talk to us, the growth levers. How do we start? Where does it end? where does the cycle repeat? Okay, so start with the premise. 90 % of your growth will come from 10 % of the stuff you're going to try.

1:01:03So you've got to narrow down the list quickly. The first exclusion we talked about is map your growth model, find your rate limiting step, focus on areas that mathematically can have the biggest impact. The second thing is these growth levers, they're not in your head, but they're going to be in your customer's head somewhere. So go out, listen to your customers. We use a jobs to be done interview technique approach, but there's other ways. but find that locksmith moment. Where are they gonna be when they suddenly realize they need you more than anything else even if they don't know you exist?

1:01:30And you've got lots of ideas, test them. Run growth sprints, run three experiments a week. Test quickly. Most of these ideas are gonna fail but if you start with a clear hypothesis and design an experiment, the failures will make you smarter. They'll move you closer to success. But after that, it's kind of, it's a journey of indeterminate length, right? It's not like building muscle in the gym where you get 1 % better every week, it's really like nothing, nothing, nothing, bang. So then the question is, are we even on the right track? Well, if you're learning, then you're making progress because ultimately, startup growth comes from revenue and that comes from selling lots of products and selling lots of product comes from learning.

1:02:11So the first step, if you're learning every week, you're on the right track. That's the number one leading indicator. Okay, I've got to ask, because you mentioned it, Can you explain a bit more about the Jobs to be Done framework? All right. So Jobs to be Done was originally popularized by Clayton Christensen in the Innovator's Dilemma. RIP. May he rest in peace. But the idea was developed or co-developed by a guy named Bob Mesta, who was originally an engineer in the auto industry. And he's actually generously spent a lot of time with my co-founder and I helping us understand the theory and come to practice it.

1:02:48And it's basically, it's a simple mental reframe where you say, instead of people don't buy products or services, they hire them to help us make progress in our lives in a particular situation. So the key then, what you've got to do is forget your product and figure out what are the situations in which people tend to hire your product. You know, it doesn't matter if a locksmith uses picks or shims or replaces locks. No one cares, right? What's the situation? I come home and I can't get into my house. So you've got to understand. So you use this interview technique to figure out what are the situations in which people have the problems that you solve or are struggling to achieve the goals that you help people achieve.

1:03:28Most humble American I know. Thank you so much for joining me on Secret Leaders. It's been a pleasure. Please, listeners, if you want to grow your startup, which if you don't want to die, I guess you should, please go check out Growth Leavers by Matt Lerner, L-E-R-N-E-R on Amazon. Awesome. Fantastic.

1:03:51If you enjoyed this episode and found it useful, please write us a review and subscribe wherever you listen to your podcast. It makes a real difference. And we genuinely love reading what you think. We read every single review. I've been your host, Dan Murray-Surter. And we'll be back next week with more lessons for entrepreneurs and leaders. See you next time.