What Growth Hacking Really Means for Your Startup


By: Elizabeth Usovicz, Principal of WhiteSpace Consulting, as part of a series she writes for ACA aimed at entrepreneurs, "Your Pitch is Just the Beginning."

What is growth hacking? Many startup founders aspire or claim to be growth hackers, but the term’s meaning has lost precision since it was first used six years ago. Like “bandwidth,” the word “hacking” has mainstreamed into popular culture and is often used to describe a shortcut in food, fashion and life in general. Growth hacking for startups is not an easily duplicated quick fix. Investor and entrepreneur Paul Singh noted at a 1 Million Cups meeting in Kansas City that “Everyone wants to read about growth hacking...[but] by the time the growth hacker actually writes the growth hack out, there’s no yield anymore.” 

The term “growth hacking” was coined in 2010 by entrepreneur and angel investor Sean Ellis. Ellis helped several Silicon Valley companies, including Dropbox and Eventbrite, to achieve significant growth through a unique blend of innovative thinking and programming. Here are three key elements of growth hacking that every startup founder should know.

It’s Where Mindset Meets Skillset: Growth hacking requires both focus and agility. First and foremost, growth hacking is a mindset that lives at the crossroads of creativity, marketing and software engineering. The sole purpose of growth hacking is growth. This relentless focus is essential to uncovering breakthrough integrations of software capabilities, online behaviors and viral interactions.

The founder of a mobile software startup learned this the hard way. He relied on an engineering mindset to develop his app, which was programmed to work with phone numbers in the United States. When the app unexpectedly spread virally to Europe, the startup was swamped with support requests from international users whose phone numbers were incompatible with the app. A growth hacking mindset isn’t layered onto to a startup and its products; it’s baked-in from the start.

It’s Intentional and Integrated: In large companies with significant resources and functional mindsets, developers build products that marketers promote through multiple channels. The growth hacking mindset incorporates the product itself in its own viral marketing. Messaging software WhatsApp reached a global audience by offering a simple and affordable alternative to phone plan text messaging. WhatsApp leveraged a need for group chat in this huge global market, intentionally turning its chat features into a viral distribution channel.

It’s Testing-Oriented and Data-Driven: Growth hacking is premised on the customer acquisition tools of direct marketing: testing and analytics. The growth hacking approach strives first for a deep understanding of user behaviors and then reverse engineers online behavior flows. After programming for the desired behaviors, growth hackers test, analyze relevant data, quantify the results, adjust and test again. And again. This meticulous, ongoing attention to metrics may sound tedious, but it’s the critical path to scalable gains in user acquisition.

The core of true growth hacking is experimentation and grit. Thomas Edison described his discovery process over a century ago, and it still offers valuable perspective: “I have not failed 10,000 times. I have successfully found 10,000 ways that won’t work.” 

Subscribe

New Look, Continued Commitment by Emily Angold  on  September 21
Kevin Learned: Entrepreneur, Teacher, Angel by Emily Angold  on  September 04
Five Ways Angel Investing Gave Me Wings by Kelley Skoloda (Blue Tree Allied Angels)  on  August 31