Grow to Grow

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Essays

While in San Francisco last week, I heard a very interesting comment a few times from YCombinator founders: “our advisors set ridiculous – even unreasonable – growth targets for us, which forced us to think more creatively about how to acquire customers and solve problems.”

In each of those particular cases, the founders ended up not only finding, but dramatically exceeding those growth targets, and realizing something very new about the potential of their business in the process. Invariably, the CEO commented that they “think about their business differently now” and have a level of self-belief, and conviction, that stretches beyond simply growing well, or breaking even soon. Even asking the question: “What would it take to get 3x the number of customers next month that we have this month?” and treating it seriously could, it seemed, create conditions that accrued positively to the business.

It reminded me of an experiment a friend of mine ran with his startup – he was charging $49/mo for his digital subscription, finding that churn was reasonable and growth steady. He decided, however, to charge $1000 for it one month, to test whether his pricing was right. Incredibly, he found that he sold *more* and churned *fewer* customers. The higher price point associated the product with a premium experience to the consumer, exposed an entirely new demographic who might not have been interested otherwise, and grew his sales. It’s not a clean analogy to the growth cases, but it made me think that forcing yourself to *discover unknown unknowns* can catalyze your business in really great ways. What are the embedded assumptions you’re making about your customer and your product, and how can you create a process whereby you can uncover those quickly?

I sometimes find this hard to score with this equally interesting early stage advice: it’s best to be undercapitalized, highly focused on the experience of the very few, and disciplined around product quality. Of course, these points of view may not be mutually exclusive, and in fact leaving features *out* and extreme discipline may result in a cleaner, simpler, and thereby more appealing product experience and better growth. Moreover, an obsession with growth at all costs is not inherently good itself. After all, growth leads to bubbles, to unscrupulous behavior, and to a culture that can’t sustain itself.

But nonetheless there is, it seems, real power to thinking bigger.

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