Listen to… go beyond growth hacking, learn from Netflix and follow the journey from snowboards to Shopify…
Billion dollar software
Shopify: Tobias Lütke
Tobias Lütke is the co founder and CEO of Shopify, an ecommerce platform with over 800,000 customers and annual revenues of $1 billion.
In this interview on How I Built This, Tobias tells his story of programmer with a passion for snowboarding to building the “go to” ecommerce software.
- Finding value in the solutions for internal problems – After solving his own problem (no affordable, fully integrated ecommerce software) Tobias and his co founder realized that others would have the same challenges. The market for the software appeared to be bigger than the market for his snowboard store. So they pivoted.
- When approaching investors, have a proven formula for growth. It’s a lot easier to get funding if you have something that says “insert money here and profit comes out here”.
- “It might not work” isn’t a reason to not start something. Early on Tobias and his co founder asked themselves “what happens if this doesn’t work?”. The answer was that it doesn’t matter because they’re going to learn a lot. And it’s going to be part of life’s experiences.
End of growth hacking
Short episode of The Startup Chat with Steli and Hiten talking about how growth hacking doesn’t work anymore.
Copying tricks from other peoples success used to work. But now everyone is doing it.
- Growth hacks are too focused on a single metric and don’t take into account the full customer journey. For example, we shouldn’t be asking how to get more sign ups. We should be asking how to get more engaged, retained, high paying customers. That doesn’t have to mean more signups.
- Forget hacks and double down on the timeless tasks – The things you know you need to do but you don’t want to do.
- Whoever understands the customer the best, will ultimately win their business. Talk to your customers, find out about them. Ask them for advice on how you can do better.
New podcast from Hiten Shah and Patrick Campbell called Tradeoffs. Their plan for the series is to look at product decisions of bigger, well known companies.
Although the content of this episode is not as actionable as it could be, it’s an interesting listen.
Looking forward to future episodes.
- Don’t become too reliant on others for the core of your business. Especially when today’s partner can easily become a competitor. Make sure you’re creating your own assets. This is the situation Netflix has with the makers of a lot of content on their service. They’re starting their own streaming services and pulling their content off Netflix. To combat this, Netflix have been investing heavily in their own shows.
- To find out how strong your product market fit is, ask the question “how disappointed would you be if ABCD Product didn’t exist?” You’re aiming for 40%+ of respondents saying very disappointed.
- Being first in a market can be a significant advantage but it also comes with disadvantages. Once your’ve proven the market, other players can copy your business model and come after you. Protect your position by being original.