Almost every leader I speak with (or a job post I go over) mentions ‘Empowered Teams.’ Yet, only a handful can truly articulate what that really means. And, more importantly, how to build and nurture an empowered culture. Maybe Marty Cagan (the one and only) did too good of a job popularizing the term empowered. 🤣

From my experience, there’s no one-size-fits-all approach to building empowered teams. It’s about finding what works for you and your team. But what really matters are a few core principles that I observed over and over again, which are the DNA 🧬 building blocks of any empowered team.

I am aware that there’s so much AMAZING literature on how to lead down and drive empowerment. Hence, in this write-up, I will do my best to share my personal take on those principles based on my own experience. So no, this write-up is definitely not the Empowered book or other literature recap❗

I will share my story and focus on the approach I developed after years of trial and error and (embarrassing) mistakes. I am not a leadership guru, and I am still only a few-plus years into my leadership journey. Nevertheless, I hope this article helps you ‘un-suck’ at leading down, even if just a little. 😉

Chapter 2: My leadership journey.

The early days

I started leading product teams in 2017 when I did the unthinkable and relocated to Vietnam 🇻🇳 to join Sentifi, a Swiss fintech startup. I led a team of two PMs, and oh boy, did I suck.

In hindsight, it makes sense. The only thing I really knew how to do well was being an individual contributor. Plus, I had no mentors to guide me. And back then, the product community was almost nonexistent (Lenny’s newsletter wasn’t even a thing yet). 😓 To top it off, I didn’t have the self-awareness to know what I needed to improve.

To be honest, my first taste of ‘Leadership’ wasn’t great. Vickie King (my Sentifi manager), I’ll be forever grateful for the Sentifi opportunity, but seriously, what were you thinking? 🤣

Subscribe now

Watching and learning.

Everything changed when I joined Ansarada, an Australian startup (now publicly listed). Ansarada embraced the Atlassian way, and I had a front-row seat to observe and learn firsthand. For some of you, working in an empowered culture might seem obvious, but for me, it was a revelation and a breath of fresh air. It made me feel safe, motivated, inspired, and genuinely happy. ❤️

Looking back, here are a few Ansarada culture takeaways I want to celebrate:

1. Leadership Development.
   Managers mentored their IC reports (Individual contributors) using ‘The 5 Levels of Leadership’ (by John C. Maxwell) frameworks, helping non-managers groom their leadership skills.

2. Radical Candor.
   Managers helped nurture feedback culture through ‘Radical Candor’ (by Kim Scott) principles, helping everyone in the company on all levels to give and receive feedback effectively.

3. Career Growth.
   Managers actively invested in the career development of their ICs, guiding them to uncover what they genuinely care about and integrate that passion into their day-to-day work.

4. Personal Growth.
   Managers promoted personal development through cross-company challenges, such as reading ten books in ten months and fostering continuous learning.

5. Collaboration & Values.
   Managers built cross-functional teams across Engineering, Product, and Design (EPD), facilitated hackathons and design sprints, and ensured Ansarada’s values - Care, Curiosity, Courage, and Change - were genuinely embodied, not just slogans on the wall.

Making an impact.

Fueled by the Ansarada way, I joined Miro’s Growth Product (PLG) team. At Miro, I led a team of four senior and lead PMs. This time, I had the battle scars and an internal compass guiding me on my mission: building empowered teams that could consistently and sustainably deliver outsized impact. And it worked. 😎

Before we dive into my ten principles for building empowered teams, here is a moment of vulnerability.

Even (and especially) at Miro, I made mistakes. However, thanks to Miro’s fast feedback loop culture, I was able to turn those mistakes into valuable lessons. ☝️

Here are a few leadership mistakes I made along the way: 🙃

1. I tried to be too nice and avoided giving timely, tough feedback.

2. I set non-ambitious goals because I was worried about being disliked by the team.

3. I didn’t take full responsibility for the team’s negative outcomes.

4. I struggled to find the right balance between letting go and taking control.

5. I didn’t lead by example on the back-to-office policy I was enforcing.

Chapter 3: The Blueprint

Share

After leaving Miro, I took time to reflect on my journey and the lessons I had learned. As part of this self-awareness exercise, I crafted a list of principles that helped me build a winning team throughout my journey. I believe these principles form the DNA building blocks of any empowered team.

1. End-to-end ownership. ➡️
   I trust and expect the team to do whatever it takes to get the job done. This trust means the team will make decisions, raise flags, and ask for feedback when needed. As a manager, your role is to support them but not to become a bottleneck!

2. Clarity on what impact is (and isn’t). 💪
   If the team doesn’t understand what impact truly means, how can they succeed? Not everything qualifies as impact. For example, delivery isn’t impact, and effort alone isn’t impact. But moving a key metric or simplifying and improving a process - now that is impact.

3. Speed is everything. 🏃
   Speed in decision-making, execution, and learning is the most powerful enabler for reducing ambiguity, cutting losses early, and doubling down on winners. It’s how you outpace the competition and win the market. As a manager, it’s your responsibility to ensure that speed isn’t just acknowledged by your team but fully embraced and embedded in their day-to-day work. Remember, the biggest enemy of speed is perfection. If you chase perfection, you’ll lose. Speed and perfection simply don’t coexist. My own unhealthy perfectionism has been one of my biggest struggles throughout my entire career.

4. Tailor your communication to the audience. 📢
   I tailor communication expectations to each team member because everyone is different, and so are their communication preferences: F2F vs. online, sync vs. async, weekly vs. daily, or pull (asking) vs. push (sending summaries). For communication to be effective, it must be adapted to fit the audience.

5. Feedback is your API to communicate with empowered teams. 🗣️
   This one is crucial, and there are a few prerequisites to ensuring the feedback loop works:

   1. You won’t achieve frequent and meaningful feedback if you haven’t built trust - no trust, no feedback.

   2. Trust won’t happen if you haven’t built a relationship with your team members - no relationship, no trust.

   Think about it, feedback is a two-way street. As a manager, you must encourage your direct reports to provide feedback to you. But they won’t share their honest feedback unless you trust each other.

6. Humility and vulnerability will take you far. ❤️
   When you’re winning, give credit to your team. If you don’t know something, admit it. And if you’re wrong (which happens often), just own it. Empowered teams don’t follow psychopathic leaders. Simply put, don’t be an asshole - whether in the good times or the bad.

7. Define the managers’ accountability. 🧐
   Any team outcome, for better or worse, is the manager’s accountability. Understanding this helps the team recognize why it’s crucial to never let the manager be surprised and align on the problems the team is solving. The manager’s role is to provide feedback, stress-test hypotheses, and risks, and ask the right questions. Additionally, it’s the manager’s accountability to nurture a safe environment where learnings are celebrated, and teams aren’t afraid of failure.

8. Invest in your team’s career development. 💼
   Without actively investing in career development, retaining top performers and helping them do their best work is impossible. As a manager, it’s crucial to understand what motivates your direct reports, their interests, and career aspirations, then tailor their career paths within the company accordingly. This often requires thinking outside the box, as many organizations lack flexibility and resist change. Simply put, you want your team to work on what they’re truly passionate about; it’s one of the prerequisites to achieving a 10X impact.

9. Mentoring is an ongoing engagement. 🌱
   Mentoring focuses on turning your direct report’s strengths into superpowers, improving their weaknesses, and equipping them with the tools to observe and adjust their behaviors. It’s not a task reserved for quarterly performance reviews but an ongoing engagement. Additionally, you may not always be the best fit to mentor your direct report on specific hard or soft skills; in such cases, you can still support them by connecting them with another mentor, either within the company or externally.

10. Keep the motivation high. 🔥
    Dopamine-fueled teams, driven by the pursuit of ambitious achievements, are the ones that deliver 10X results. As a manager, your mission is to cultivate this dopamine-driven motivation (something that can’t be faked). You do this by setting bold, moonshot goals and pushing the team beyond comfortable, optimizations thinking. However, these ambitious goals won’t be achieved unless you first reduce execution friction (by applying principles 1 to 6) and create a safe environment (by implementing principles 7 to 9).

Chapter 4: The Afterthought

As I mentioned earlier, the manager’s job is to ensure teams can consistently and sustainably achieve outsized impact, and everything we’ve discussed so far leads to this goal. 🚀

1. If you find the principles I’ve outlined valuable, use them to build empowering relationships with your team. The first step? Share these principles with your team and ask for their feedback.

2. Additionally, you can apply these principles to improve your leading-up game; by simply reversing them. Leading up and leading down are mirror practices. 🪞

3. And one last thing. While this post is based on my experience leading product teams, I’m confident that many of these insights can also be applied to leading non-product teams, such as engineering and design.

As product leaders, our primary goal is to build and grow businesses, which ultimately means maximizing their dollar value.

However, simply driving ARR isn’t enough. It’s not only about the absolute ARR ($) generated but also how effectively your startup generates that ARR. This is just as critical in determining the business dollar value.

Hence, to truly call yourself the ‘CEO of the product,’ you need to think like one. This involves approaching ARR through the lens of Product and wearing the VC/CFO hat to ensure we spin the revenue flywheel effectively and sustainably. 

In this blog post, I’ll explore why Monday.com’s market value per $1 in ARR is 5.13 times that of SimilarWeb’. The insights from this exploration are applicable to any B2B SaaS startup.

2. Before we start

Monday.com helps teams organize and track their work, making it easy to manage projects, tasks, and team collaboration all in one place.

Similarweb provides data about website and app traffic so businesses can understand their online performance and stay competitive in their industry.

Both Monday.com and SimilarWeb are:

1. Public

2. B2B SaaS

3. Growing

4. Profitable!

5. Market Leaders

6. Rocking an amazing culture

To analyze the 5X gap in market value per $1 ARR, I will explore the following metrics and benchmarks using public investor relations data from Q2FY24 :

1. Gross Margin (Non-GAAP)

2. Operating Margin (Non-GAAP)

3. Free Cash Flow (FCF)

4. CAC Payback

5. Net Revenue Retention (NRR)

6. ARR Growth (%)

7. Rule of 40 (Ro40)

Share

3. Margins

Gross Margin (Non-GAAP):

What is that?

After covering the Cost of Goods Sold (COGS) - infrastructure costs, third-party licensing, etc. the company keeps X cents for every dollar of revenue.

Yes, Monday.com’s margins (91%) tend to be higher compared to SimilarWeb (81%) primarily because SimilarWeb operates as both a SaaS (Software as a Service) and a DaaS (Data as a Service) company.

The DaaS model relies heavily on data acquisition, which involves substantial ongoing costs for purchasing, processing, and maintaining extensive data sets. These data-related expenses directly impact the Cost of Goods Sold (COGS), making them a recurring cost that lowers SimilarWeb’s gross margin relative to companies with purely software-based models.

Operating Margin (Non-GAAP):

What is that?

After covering COGS and operating expenses - R&D, marketing, sales, etc. the company keeps X cents for every dollar of revenue.

Monday.com’s operating margin stands at 16%, while SimilarWeb has reached 9% -both having transformed their once-negative margins into positive territory.

SimilarWeb, by default, had a tougher journey to positive operating margins due to the higher COGS inherent in their data-cost-intensive model. Yet they still achieved profitability despite allocating a similar percentage of revenue to R&D as Monday.com (the low 20’s) and overspending by 10% on Sales and Marketing.

However, to fully change the sentiment around its market cap, SimilarWeb will need to sustain double-digit margins over at least a few quarters two quarters.

4. Free Cash Flow (FCF).

What is it?

Free Cash Flow (FCF) is the available chunk of cash (as a % of revenue) that a company can use to invest in growth.

Monday.com’s free cash flow (FCF) margin of 21.5% translates to over $200M annually, while SimilarWeb’s lower FCF margin of 7% totals around $17M annualy. Thanks to Monday’s higher ARR and FCF, there’s a 12X difference in absolute annualized free cash flow. In other words, Monday has 12 times more cash to invest in growth. It’s impressive.

5. CAC Payback

What is it?

CAC Payback is the time required to recover customer acquisition costs. A shorter payback period indicates quicker returns and enables faster reinvestment.

Monday.com’s CAC payback period averages 12 months across all ACV segments, while SimilarWeb’s ranges between 18 and 24 months.

SimilarWeb’s ACV composition is heavily skewed toward Enterprise, with 60% of its ARR coming from customers with $100k+ ACV. This leads to longer sales cycles and higher upfront investments in acquisition and onboarding. In contrast, Monday.com generates only 30% of its revenue from $50k+ mid-market/enterprise customers, layering an efficient Product-Led Growth (PLG) strategy for SMB acquisition and expansion with a high-touch approach for larger, high-ACV accounts. As a result, Monday.com’s payback cycles are nearly twice as fast as SimilarWeb’s.

Think about it: if you have 12X more free cash flow (FCF) to invest and can recoup your investment twice as fast through CAC payback, you’re operating at supersonic speed.

6. Net Revenue Retention (NRR)

What is it?

Net Revenue Retention (NRR) is the percentage of recurring revenue retained and expanded from existing customers over time.

Monday.com boasts an NRR of 110% across all ACV segments, reflecting strong expansion within its existing customer base.

SimilarWeb, while also achieving 110% NRR, only reaches this level with customers whose ACV is over $100K—who, as mentioned, contribute 60% of their revenue. For customers with ACVs under $100K, however, SimilarWeb’s NRR drops to between 80% and 90%, pulling their overall NRR down to 99%.

This means a significant churn issue within SimilarWeb’s sub-$100K segment, forcing them to rely heavily on new customer acquisition to drive growth.

7. ARR Growth (%)

What is it?

ARR Growth is the percentage increase in recurring revenue from new and existing customers over time.

Compared to SimilarWeb, Monday retains more of every dollar earned, has more free cash for growth, recoups investments faster, and sees expansion across all ACV segments—all driving higher ARR growth.

To put this in perspective, Monday.com’s 34% year-over-year revenue growth is 2.5 times SimilarWeb’s 13%, a 19% delta that compounds significantly. Over ten cycles, compounding 34% growth results in an 18.6X multiplier, while 13% growth reaches only 3.4X.

Finally, let’s apply the Rule of 40 (Ro40) which balances between growth and profitability and provides another benchmark for how effective and sustainable is the ARR machine. If the Ro40 is 40% or higher, it indicates a healthy and sustainable ARR engine.

Monday.com:

34% (ARR Growth) + 16% (Operating Margin) = 50%

// Above the 40% benchmark.

SimilarWeb:

13% (ARR Growth) + 9% (Operating Margin) = 22%

// Below the 40% benchmark.

8. Final Words.

1. I will re-iterate. How effectively a startup generates ARR is just as important as how much ARR it generates.

2. Although Monday.com is an overperformer, this doesn’t mean SimilarWeb is underperforming. SimilarWeb has a strong team, and their ARR effectiveness improves with each quarter—I’m personally bullish on their success. SimilarWeb has the potential to double its market cap in the next 12 months by:

   1. Elevating operating margins to double digits and maintaining this level quarter over quarter.

   2. Reducing the payback period to an average of 18 months.

   3. Increasing the NRR for ACV <$100k (currently impacted by churn) from the mid-80s to the high 90s while keeping the NRR for ACV >$100k steady at 110%.

3. Beyond the ARR effectiveness, there are, of course, other considerations impacting startups’ market cap, such as TAM, Defensibility Moats, and the proven ability to execute Horizontal and Vertical Expansion. But this is out of the scope of this blog post.

Once upon a time, in the pre-COVID days, I was working at Ansarada, an Australian Sales-Led startup with a mission to make M&A, IPO, Acquisition, and Audit events as simple and smooth as changing a lightbulb.

To win, we decided to go PLG.

This required a mindset change and a product change, and it wasn’t easy. It was a long journey, and Amplitude was part of it.

Amplitude’s office was 500 meters from ours. I remember their team spending days in our office, setting us up for success in our PLG adventure.

Eventually, Ansarada went IPO on 2020. And Amplitude had a part in it.

(The amazing view from Ansarada Sydney office - sometimes between 2017 and 2019)

Why should you care?

Amplitude’s strategy is simple.

If you know how to do PLG. You will need Amplitude.

Hence, Amplitude empowers product leaders to create actionable and slick guides. And not just any Product Leaders but the crème de la crème.

Moreover, if we talk about PLG, who is better to listen to than those who paved their own way from sales-led to product-led?

Amplitude layered on the PLG motion on top of their SLG one in late 2023.

They walk the talk.

Who is this writeup for?

1. CEOs, Founders, and CPOs at early-stage and scaleups.
   So, you get your PLG game up before you spend $15,000 on a PLG advisor.

2. Growth and Core PM.
   So, you save $1000+ on a PLG cohort.

3. Marketing and Tech Leaders.
   Because PLG is a team sport.

What do you get?

20 PLG insights about:

1. Evaluating PLG Fit

2. Building an A-List PLG Team

3. Nurturing a Winning PLG Culture

4. The Unpleasant PLG Facts

5. Pulling (a) Acquisition, (b) Retention, and (c) Monetization Levers

6. 🎁 [Bonus] My Top 10 Free Amplitude Playbooks! Your mini-PLG MBA

Let’s start.

➜ (1) Evaluating the PLG Fit

1 - No Marketing OR Sales predictability, No PLG!

PLG is about your Product generating and capturing demand.

So, if you are struggling to close the gap between what the company thinks users want from the Product and what users really want.

This means that you still can't generate and capture demand with marketing and sales.

PLG won’t fix that for you.

It will just make everything more complex.

2 - Low use-case frequency. No PLG!

You can’t monetize customers if they are not retained, and you can’t retain customers if they are not activated.

To create a habit (= activate), you need your customer to experience value frequently.

No frequency, no habit, no PLG.

3 - High complexity. No PLG!

If the product friction is too high, and the pain the product solves is not 11 out of 10, the self-serve experience will fail.

And no fancy product-led onboarding will solve it.

Reduce complexity first. Otherwise, no PLG!

4 - The farther the user is from the buyer, the harder the PLG!

You are unable to get the first in the door before someone OKs it.

For example, if a user can’t experience freemium / trial before some form of a buying decision is made by someone else.

This happens in heavily regulated industries, such as Legal, Defense, Healthcare, Constuctions, etc.

Share

➜ (2) Building an A-List PLG Team

5 - It’s not only the onboarding!

The PLG team's mission is to uncover, validate, and pull all the growth levers across the user journey.

The entire user journey is fair play.

Avoid limiting the scope of the PLG team to only the first session, or just the AHA moment.

6 - Report to the CPO, not the CMO!

You are product-led, not marketing-led.

Reporting to Marketing will overfocus the team on the Acquisition goals. It’s a bad practice.

You will likely layer on the marketing motion, but the PLG team remains a Product team.

7 - There are only three levers to pull!

Acquisition, Retention, and Monetization.

Start with one, as each lever is a different ball game.

And here is a cheat code.

In 90% of cases, you start with Retention (the hardest one).

Because, no Retention, no PMF!

Closing deals != Retention

8 - PLG is as much about Psychology as about Quant!

Having a product designer and a data person on your PLG team is non-negotiable.

It might sound obvious, but 50% of Series A or B startups that run “PLG” miss either or both functions.

Aspire to create data stories and delightful experiences, NOT dashboards and mockups.

➜ (3) Nurturing a Winning PLG Culture

9 - Sales teams will hate you (at first)

PLG does not cannibalize sales teams' revenue.

Yes, the ACV will dip. It's true.

But pipeline quality and volume will go up.

More advocates, more usage data and a better win rate.

Remember, Product Qualified Accounts (PQA) convert for up to x5 better than PQLs. Love restored!

10 - No data, no PLG!

PLG is crafted through experimentation.

Running experiments requires you to fully understand your business and product fundamentals, such as CAC Payback, Activation Rate, 90-day Retention, etc.

Without data, there are only HiPPO (Highest Paid Person's Opinion), and PLG can’t survive HiPPO.

11 - Self-serve analytics rocks!

Self-serve analytics won’t entirely replace your need to go deep with SQL.

But! It will make your experince of writing and telling a data story much more delightful and accessible for all.

It’s not either SQL (Non-SS Analytics) or SS Analytics.

It’s both.

Share

➜ (4) The Unpleasant PLG Facts

12 - PLG takes time!

Going from Sales-Led to Product Led?

Align expectations on WSLL (What Success Looks Like).

The chances that your PLG pipeline will account for more than 5% ARR in 12 months are slim.

PLG is a long-term play that pays back with dividends.

However, don’t start PLG if you are in for a 12-month ARR fling!

13 - You will fail a lot...

Get used to a 50% to 80% PLG experiment "failure" rate ( = not proving your experiment hypothesis with stat sig).

It’s about deep and actionable learnings and building on top of those learnings.

If you do that, you win.

➜ (5a) The Acquisition Lever

14 - You can’t fake network effects (NE)!

If the value for a single user is not amplified by inviting other users to the product, a shiny invite/share button won’t spark virality.

Your product simply lacks the NE DNA (Network Effects DNA).

So, if no NE DNA (Network Effects DNA) is the case, and unless you are revolutionizing your niche with a 100X WoW experience, you better focus on other acquisition tactics.

15 - Treat content as a product!

Content is how you package and transmit value through marketing channels to generate demand.

It can be pure product-led content, such as templates and pre-products, or mixed plays, such as lifecycle or even programmatic SEO content and UGC.

Content is how you tell your product-led story. Master it.

Subscribe now

➜ (5b) The Retention Lever

16 - Building a habit takes time!

If you want to kill your activation ( = the heart of Retention), focus your PLG team only on the first session.

Why? Because activation takes weeks in most cases, even for “simple” products such as Canva and Figma. It’s a multiple sessions game!

The PLG team must own the journey until the Habit to Win Activation.

17 - Activation goes beyond tactics!

Activation is about knowing, every single time a user lands in the product, who this user is (ICP-fit, Role, Pains), what they want to achieve (goals), and crafting a personalized experience that will help them to accomplish the job faster and more delightful than they expected, so they come back.

Activation isn’t about pop-up X or tooltip Y!

➜ (5c) The Monetization Lever

18 - Reverse trial rocks!

But what about freemium?

Assuming your product fits freemium, reverse trial still offers the best of all worlds.

An opportunity to experience the full product capabilities (the trial period), a conversion to a paid decision point (when the trial ends), and a freemium experience for those who don’t convert. Try beating that!

Share

19 - Hybrid pricing rocks!

Your PLG team should experiment with adding additional monetization layers, such as one-time add-ons and usage-based pricing.

Relying solely on seat-based pricing is too risky and too light on expansion.

We all learned this the hard way in the last 24 months.

20 - You win by NRR! (Yes, it’s still the case)

A common mistake of a PLG team is to focus on new revenue while not giving enough love to expansion revenue.

NRR is where most of your ARR growth comes from (at least for scaleups). If you lose the NRR game, you go belly up.

Driving NRR requires you to experiment and plan your way ahead!

➜ (6) 🎁 My Top 10 Free Amplitude Playbooks!

1. Product-Led Growth Guide Volume 1: What Is PLG?

2. Product-Led Growth Guide Volume 2: How to Get Started with PLG

3. Building a Culture of Experimentation

4. The Amplitude Guide to Product Metrics

5. Acquisition Playbook: Mastering Customer Acquisition Strategy

6. Mastering User Retention Playbook

7. The Amplitude Guide to Personalization at Scale

8. Optimize Your First-party Data for Personalized Experiences

9. Mastering Monetization Strategy

10. The B2B Guide to Upselling and Cross-selling

I recorded a podcast episode with Jean-Mathieu Chabas (JM) a few weeks ago.

JM previously headed Growth at Google Ads (a $100B+ per annum beast) and is currently the Head of Growth Products at Databricks.

The podcast episode (which is coming later in a week) was packed with pearls, and I had quite a few aha moments.

Moreover, I believe many so-called best-in-class B2B SaaS startups have much to learn from Google's approach to Growth Product.

I predict that in 3 to 5 years, Google Ads's approach to Growth and structuring Growth Teams will become the predominant approach (the benchmark) throughout the startup industry. ❤️

At the moment, almost none of the fancy B2B SaaS startups and scaleups parading the Forbes 100 cloud list follow any of the Google Ads growth principles I share in this blog post.

The scale

1. Google Ads is a $100B+ a year Revenue machine, and it's only the SMB part. The scale is crazy. It’s like 50 Hubspots, 40 Dropboxes, or 25 Zooms. 🤣

2. This also means that 1% in revenue growth is a plus BILLION $ to the revenue bottom line. It is quite a motivation booster for the growth teams.

3. Moreover, there are only a few 1000s of sellers, which puts the average revenue generated per seller at $10M+.

The Growth Teams

Subscribe now

The role of Growth teams at Google Ads is to improve customer campaign performance and they do so by:

1. Guiding the Core Product teams on ‘what to build?’
   ( = Product Roadmaps Aligment) | This part is quite commond in B2B SaaS startups.

2. Guiding the GTM teams on ‘which products to surface and to whom?’.
   ( = $ Incentives Aligment) | This almost never happens in B2B SaaS startups.

Just think about it! If Ad campaigns deliver a repeatable positive ROI, customers will never stop spending, resulting in a neverending $ loop! Hence, it’s the Growth team’s role to learn what drives the performance of an ad product (there are hundreds of existing products within Google Ads) and align those learnings through the Roadmaps with Core and Incentives with GTM.

Let’s reiterate, because this one is important.

Customers want to spend when it’s an ROI-positive investment; all they need is for Google Ads to provide them with enough ways to do so. Hence, if done correctly, Google Ads growth has no limits. This makes the Google Ads model so much more scaleable than, for example, business models of productivity tools.

The secret ingredients

1. It’s 80% Machine Learning work. 🤖

Google iterated on its Ads ML model for 20 years. The algorithmic approach to experimentation (rather manual) is Google’s Growth team superpower. So, you know, even Google’s Gemini was built on top of the Google Ads ML model.

Question: Is algorithmic experimentation the future of Growth? In which cases and scale is algorithmic experimentation applicable?

2. The Google Ads Growth team optimizes both for short-term and mainly for long-term success.

The Growth guidelines of what to sell and to whom per customer/segment to GTM are packaged in a three-layer cake, with the main weight being long-term.

Share

Question: Why is the dominant paradigm in traditional B2B SaaS startups for Growth teams is to focus on short-term gains? Is Google’s long-term focus approach applicable to early-stage startups and scaleups?

3. GTM is much more than Sales.

GTM teams are customer advisors and serve as the customer frontline from product, operations, and technical perspectives. Their mission is to make customers successful by ensuring the adoption of the products packaged in Growth guidelines. They do so through PLG (in-product) and SLG (frontal sales). And, of course, GTM Incentives ($) are aligned accordingly!

Question: What value can we extract from Growth and GTM / Sales Collaboration (beyond PLS - Product Led Sales) in traditional B2B SaaS? How should this relationship be structured and incentivized?

The future (or present) of Google Ads

Google knows much better than any ‘Performance Marketing’ agency how to create large-scale, repeatable, high-performing campaigns simply because Google owns all of the campaign data (all of them). Moreover, Google's goals and Customers are aligned, which means that Campaign Success = Customer Success = Google Ads Success.

Google is taking (and will keep taking) campaign ‘controls’ from the customers and managing those campaigns all through (one-click) automation.

It’s the same reason that humans will not be allowed to drive in the distant future simply because autonomous cars drive better. Google Ads is on the way to becoming a one-click-go platform.

“...Here is my product (shoes). I want to spend $10 the most, so go!..”

Google will build the campaign, the ads, and the creatives based on best practices, the customer, and the product context, place the bids, and close the loop.

This means lower to no learning budgets, lower entry barriers, and faster cycles.

And what about the performance marketing agencies?

They must adapt by abstracting their focus from tactical ( = running a campaign) activities and going multi-channel.

Takeaways (for B2B SaaS Startups and Scaleups)

1. If you dream of reaching a multi-billion ARR, your business model must support such a scale within its DNA. Google’s Ad model does. It’s a money-printing machine.

2. Growth experimentation will shift toward algorithmic experimentation. ML will become the Growth team’s core competency.

3. Best startups empower Growth teams to focus on long-term Success. Chasing monthly targets should not be the only growth play.

4. In 99% of startups, the Growth - GTM (Sales) relationship does not exist. This must be fixed. Aligning incentives can help bridge this gap.

5. Are you paying the hefty $ to performance marketing agencies? Don’t. Do it in-house. 

Disclaimer: Any numbers mentioned in this write-up are made up or available in public sources; any strategy pieces in this write-up are based on outcomes of my deep thinking or publicly available frameworks. Enjoy!

FigJam was born as Figma’s Horizontal expansion move, scaling its visual collaboration offering to the entire cross-functional team, not only designers. Leveraging ‘Content Growth Loops’ at scale has been a key driver of its success. This is why I believe it’s a great of great value to explore this strategy in depth by breaking down 6 actual FigJam content loops.

But first, let’s align on terminology. 😉

What are ‘Content Loops‘ and why do we need them?

1. Content loops drive both PLG Acquisition and PLG Retention.

2. Content loops generate and distribute content, hence, ‘Content Loops.’ 😂

3. Moreover, Content loops also supply sales with leads, out of scope for this write-up.

What types of Content Loops are there?

We differentiate Content loops by looking at the following:

1. Who generates the content? (and ‘How?’)

2. Who distributes the content? (and ‘How?’)

   1. → UGUD - User Generated User Distributed

   2. → UGCD - User Generated Company Distributed

   3. → CGUD - Company Generated User Distributed

   4. → CGCD - Company Generated Company Distributed

3. What type of content is distributed? (Boards, Templates, etc.)

FYI - The above abbrevations were coined by Reforge! Those guys rock! ❤️

How do we know which Content Loop is best?

Some of the factors that impact the strength of each content loop are:

1. Development, content generation, and distribution costs.

2. Operational scalability potential.

3. Relevancy, Reach, and Performance of a content piece and the distribution channels dynamics.

Let’s start! 💪

Now, let’s see all that in action by breaking down six FigJam content loops:

1. Share Boards (UGUD Loop)

2. Embed Boards (UGUD Loop)

3. Activity Summary (UGCD Loop)

4. Community Templates (UGCD Loop)

5. FigJam Templates (CGCD Loop)

6. FigJam Social (CGUD Loop)

1. Share FigJam Boards (UGUD Loop)

Cost: Users do both content generation and distribution. Seat back and enjoy. Some investment in initial and continuous work is required to enable and optimize the sharing experience (from sharing to landing).

Impact: Ultra high-intent, high-relevant content shared one-to-one or one-to-few manner (not one-to-many). It’s FigJam’s core direct network effect around collaboration.

2. FigJam Live Embeds (UGUD Loop)

Cost: Again, users do both content generation and distribution. However, integration (and continuous maintenance) work per platform (Slack, Atlassian, etc.) is required for the embed to work.

Impact: High-intent content is shared in mostly a one-to-few, one-to-many manner. There are more eyeballs per share than the ‘Share Boards’ loop. However, the relevancy per eyeball is lower.

3. Activity Summary (UGCD Loop)

Cost: Initial dev investment to build and optimize the lifecycle notifications. Focusing on increasing its relevancy and usefulness. In addition, there is minimal distribution cost per delivery channel (i.e., Email).

Impact: Low-intent content is shared one-to-one every T time (Day, Week, etc.) per every active user. Sounds good; however, it tends to get high spam / low open rates.

4. Public Community Templates (UGCD Loop)

Cost: It is a high investment, especially in the beginning, to spin up the community motion and provide the tools to create, submit, review (by FigJam), and rate the Templates. Once it runs, the cost is low because the community does the content generation.

Impact: Low to high-intent content is shared in a one-to-many manner. FigJam doesn't control the Template's topics (= it's the community's topic choice). The impact increases as more use cases are covered, and Public Templates bubble up in Google search (takes time...).

5. FigJam Templates (CGCD Loop)

Cost: A high investment in creating high-intent content in a non-scalable way (one by one by FigJam’s team); the distribution part is cheap but takes time. Search engines... You know.

Impact: High-intent content is shared in a one-to-many manner. The impact increases as those Templates bubble up in the search results. At some point, we get diminishing returns after covering all the core FigJam’s use cases. This is why layering Public Templates on top of FigJam Templates makes sense (lower content generation cost).

6. Figma (FigJam) Social (CGUD Loop)

Cost: It's a medium investment in generating frequent social content. This is why leveraging guest writers makes sense. The cost per content goes down with time as the reach increases (the audience size).

Impact: Low to Medium-intent content is shared in a one-to-many manner. However, the impact of each published content goes down fast (if it’s Linkedin, not the case on YouTube). Social requires a high publishing frequency. You stop, you die.

Disclaimer: Any numbers mentioned in this write-up are made up or available in public sources; any strategy pieces in this write-up are based on outcomes of my deep thinking or publicly available frameworks. Enjoy!

There are two types of Growth (PLG) work:

1. Generate and capture demand through Growth Pillars.

2. Compound the growth output through Growth Loops.

→ Both types of work reinforce each other!

This means that:

1. PLG Work that focuses only on Growth Pillars and ignores Growth Loops is just fancy Funnel Work.

2. PLG Work that ignores Growth Pillars and focuses only on Growth Loops means leaving money on the table by not compounding growth efficiently.

To deliver on the real example promise. Let’s explore how Activation (= Growth Pillar) reinforces Monday.com's viral loop to drive a killer product-led acquisition.

Loops Rules! 😎

1. Every cycle, we run compounds at 40%.

2. And, we got an extra 6640 users on top of the initial 10000.

But still, where does Activation come into play? How does Activation reinforce Monday.com’s Viral Loop? 😕

The answer is simple. Optimizing Activation impacts one of the Loops conversion variables, ‘Projects Created per User.’

• The better ‘Activation’

• The more Projects are created per user

• The higher the loop cycle compound %

• The more new users, the Loop yields

By increasing Activation by an absolute 5%, we reinforced the Viral Loop.

1. Every cycle, we run compounds now at 46% (+6%).

2. We got an extra 8501 users (+1861) on top of the initial 10000.

Case in point! 🤣

1. 𝐍𝐨𝐭 𝐬𝐭𝐚𝐫𝐭𝐢𝐧𝐠 𝐟𝐫𝐨𝐦 𝐑𝐞𝐭𝐞𝐧𝐭𝐢𝐨𝐧

To ensure Activation predicts Retention, you start with Retention and go backward. Not the other way around. If you don’t have the Retention defined, you can’t define Activation. As simple as that.

2. 𝐁𝐮𝐢𝐥𝐝𝐢𝐧𝐠 𝐭𝐡𝐞 𝐡𝐚𝐛𝐢𝐭 𝐚𝐫𝐨𝐮𝐧𝐝 𝐭𝐡𝐞 𝐰𝐫𝐨𝐧𝐠 𝐚𝐜𝐭𝐢𝐯𝐢𝐭𝐲

The core activity around which you want to create a habit around, should not only correlate with retention. It should also be aligned with users' natural behavior and the business model and be simple enough for you to impact.

3. 𝐄𝐱𝐚𝐠𝐠𝐞𝐫𝐚𝐭𝐢𝐧𝐠 𝐭𝐡𝐞 𝐧𝐚𝐭𝐮𝐫𝐚𝐥 𝐟𝐫𝐞𝐪𝐮𝐞𝐧𝐜𝐲

Driving a habit requires a repetitive action. The repetition frequency must be aligned to the natural frequency of using your product. Be careful; don’t exaggerate; it’s not what you want the natural frequency to be, but what it naturally is. Most products, including Miro, don’t have a daily frequency (X times per day, every day).

4. 𝐏𝐥𝐚𝐲𝐢𝐧𝐠 𝐭𝐡𝐞 𝐟𝐢𝐫𝐬𝐭 𝐬𝐞𝐬𝐬𝐢𝐨𝐧 𝐠𝐚𝐦𝐞

Activation happens when the habit is established; in most cases, it doesn’t happen during the first session. The onboarding experience should be looked at in the context of habits rather than sessions. Capping the onboarding thinking at the first session kills your Activation. It can take weeks and more.

5. 𝐏𝐞𝐫𝐬𝐨𝐧𝐚𝐥𝐢𝐳𝐢𝐧𝐠 𝐟𝐨𝐫 𝐧𝐨𝐧𝐞 𝐨𝐫 𝐚𝐥𝐥

Personalizing Activation works; don’t skip it. However, personalize only for your ICP segments. If it’s not your ICP, generic experience is sufficient. If you are unsure during the onboarding if it’s your ICP, ask. The statement 'the fewer questions during the onboarding, the higher the conversion' is BS.

6. 𝐈𝐠𝐧𝐨𝐫𝐢𝐧𝐠 ‘𝐓𝐞𝐚𝐦’ 𝐚𝐜𝐭𝐢𝐯𝐚𝐭𝐢𝐨𝐧

SaaS B2B products that serve teams ( = scale value beyond individual users) must play both the individual user and team activation game. It’s insufficient to activate individual users while disregarding team activation. Why? Because you sell to teams now, you better ensure your Product’s team experience delivers the promise.

7. 𝐒𝐤𝐢𝐩𝐩𝐢𝐧𝐠 𝐭𝐡𝐞 ‘𝐄𝐧𝐠𝐚𝐠𝐞𝐝’ 𝐛𝐮𝐜𝐤𝐞𝐭

All Activation does is predict Retention. But for a user to actually be ‘Retained,’ they must engage with the Product beyond Activation. Hence, the ‘Activated’ user is Retained only if, as we predict, they will continue engaging with the Product following Activation.

❌ Activation → Retention

✅ Activation → Engagement → Retention

8. 𝐏𝐨𝐥𝐥𝐮𝐭𝐢𝐧𝐠 𝐑𝐞𝐭𝐞𝐧𝐭𝐢𝐨𝐧 𝐰𝐢𝐭𝐡 𝐧𝐨𝐧-𝐚𝐜𝐭𝐢𝐯𝐚𝐭𝐞𝐝 𝐈𝐂𝐏𝐬

This one is straightforward. When you measure Retention, make sure that you look at only your ‘Activated ICP’ segment. Why ICP? Because non-ICP is not your business or priority. Why Activated? Because if the segment is not activated, those users are too early for the Retention game.

9. 𝐓𝐫𝐞𝐚𝐭𝐢𝐧𝐠 𝐀𝐜𝐭𝐢𝐯𝐚𝐭𝐢𝐨𝐧 𝐚𝐬 𝐞𝐢𝐭𝐡𝐞𝐫 𝐆𝐫𝐨𝐰𝐭𝐡 𝐖𝐨𝐫𝐤 𝐨𝐫 𝐏𝐫𝐨𝐝𝐮𝐜𝐭 𝐖𝐨𝐫𝐤

You need both. Growth work validates and unlocks opportunities, while Core work scales those opportunities and ensures its PMF. Let’s take Miro Templates as an example. At Miro, the Growth Activation team validated Templates as a set of experiments; nevertheless, at a certain point, to scale the Template experience and build it as a strong PMF offering, Core teams joined the party. 🥳

10. 𝐏𝐮𝐬𝐡𝐢𝐧𝐠 𝐟𝐨𝐫 𝐒𝐞𝐥𝐟-𝐒𝐞𝐫𝐯𝐞 𝐀𝐜𝐭𝐢𝐯𝐚𝐭𝐢𝐨𝐧 𝐚𝐭 𝐚𝐧𝐲 𝐜𝐨𝐬𝐭

Great Activation doesn’t necessarily mean Self-Serve Activation. There is no one-size-fits-all. Your Product might not have the high frequency or simplicity required to create a habit. Or maybe your potential customers expect a high touch, especially if those are high ACV Enterprise customers. For example, Pleo ($100M+ ARR B2B SaaS) is doing a kick-ass job with a hybrid product-led / high-touch activation experience. Hence, do what suits your business, Product, and customers. Not what’s buzzing on Linkedin.

I hope you enjoyed this write-up.

PLG = Self-Serve = Growth

In reality:

PLG ≠ Self-Serve ≠ Growth

Let me explain. 😉

After talking to 50+ B2B startup founders and product leaders in the last six months, I noticed that the terms Growth, Self-Serve, and PLG are used interchangeably. However, those are very much different! It’s actually PLG → Self-Serve → Growth

Share

And here is why.👇

What is PLG (Product Led Growth)?

PLG is one of the motions to drive Growth. In its pure form, PLG enables the PRODUCT to acquire, activate, engage, retain, monetize, and expand customers (= pulling all those Growth levers). For example, the product can drive acquisition by virality and content loops, activation by self-serve onboarding, monetization by self-serve monetization, and embedded usage-based expansion mechanisms.

What is Self-Serve?

In the Growth context, Self-Serve is an experience in which your ICP goes through the entire customer journey. This means all lifecycle stages (awareness to retention), without needing a human touch (sales, success, support, etc.). Achieving the ultimate Self-Serve experince requires layering PLG with Marketing. For example, Marketing is acquiring customers through performance marketing, PLG is Activating customers, Marketing is Engaging customers through Lifecycle campaigns, and PLG is Monetizing and expanding customers.

What is Growth?

Growth is about building the distribution for your Product to increase its market share within your product’s TAM (Total Addressable Market). Pulling the Growth levers (acquire, activate, engage, retain, monetize, and expand customers) by using both PLG, Marketing, and Human Touch (Sales, Marketing, and support). It's the whole thing.

To sum it up!

1. Growth topics are only complex if you try to sound fancy. 😉
2. The above applies to SaaS, No-SaaS, B2B, and B2C.
3. The ‘Head of Growth’ responsibility domain is much greater than acquisition channels, contrary to many job posts…

1. Why do growth teams exist?

2. What do Growth teams exactly do?

3. How do Growth teams differ from Product teams?

Share

Growth Teams 💚

1. Why?
Increase the Total Market Share (TMS).
This means more customers (from the TAM) are using your product and paying you $.
2. How?
Optimize existing loops/channels and set up new loops/channels through fast hypothesis, experimentation, and learning cycles to acquire, retain, and mobilize customers. We do all that through Product (PLG) and Marketing.
3. Metrics
Acquisition, Activation, Engagement, Retention, New Revenue, Expansion Revenue, etc.
4. Visibility
‘Learn as you go’ experiments plan (up to 3 months).

Product Teams 💛

1. Why?
Strengthen Total Addressable Market (TAM) to PMF fit and Expand TAM.
This means our product solves customer problems and provides a 10X delightful experience and new potential customers joining our product’s TAM.
2. How?
Increase product’s perceived value through PMF optimization feature work and 0 to 1 PMF expansion work.
3. Metrics
Feature Adoption, Retention, Satisfaction, NSM, etc.
4. Visibility
12-month roadmaps. We all love those…

1. Some think Growth Marketing = Growth Product.
2. Others think that Growth Marketing ≠ Growth Product optimizes only one and ignores the other.

In practice, Growth at Scale requires Growth Marketing + Growth Product. And both on a rockstar level. 🎸

Share

Growth Marketing

Owns the marketing-led motion. Focuses on generating demand through non-product channels (SEO, Paid Channels, etc.) and amplifies the products-led and human touch motions (Sales, Success, Account) through lifecycle marketing.

Growth Product

Owns the product-led motion end to end. Shares accountability with growth marketing to scale the self-serve business. Supports human touch teams through product-assisted experience. PLS (Product Led Sales) falls here.

The Ground Rules

1. Growth Product people are Product people. 😉

2. PLG without Growth Marketing is incomplete.

3. Growth at Scale = Growth Marketing + Growth Product.

4. Growth Marketing's responsibility is beyond acquisition.

5. Both Growth Marketing and Product supporting Human Touch

It's wild that 9 out of 10 'Head of Growth' job posts still don't recognize the subtleties of growth roles. Let's change it.

It happens to me once in a while.

Most times, those “doomed from day 1“ missions are about promising myself to stop snacking after 10:00 p.m., capping my wine to a single glass, or other BS.

But this time, it was different.

It was a nerd-first 🤓 mission to ‘Visualize the complexity of Growth org at scale.

Why? (there is a reason!)

So whenever anyone says:

I won’t need to argue but calmly pull this write-up. 🧘

So, my mission is actually not about you (my dear readers).

But about me.

I want to simplify my life. 😉

Here it goes!

You can break down the Growth org into three Tiers and each tier into three types of teams.

Each team within those tiers contributes to building the Distribution System for your product ( = Generating and Capturing Demand)

🔵 Tier 1: Growth PLG teams

It’s the heart of the PLG motion.

This is where you start when kicking off Growth.

1. Product Acquisition Teams

Acquiring users through product channels. Think Virality, Content (UGC), etc. Anything you can do to generate demand using the Product.

2. Product Retention Teams

Activating and Engaging users. Activation is the key Retention driver, so the main focus is on Activation. Think of both user-level Activation and team-level Activation (if you are a B2B startup). 

3. Product Monetization Teams

It is all about converting Free to Paid and expanding those accounts (Capturing the demand and getting this Self Serve ARR and NDR going)

🟡 Tier 2: Growth Scale teams

Growth Scale teams (layering on top of Tier 1).

4. Persona Focus Teams

Experimenting with strategic sub-segments of growth drivers. Not the entire ICP. The entire ICP is what all the rest of the growth teams focus on!

5. Channel Focus Teams

Experimenting with scaling both Performance Marketing acquisition channels (SEO, Paid, etc.), pre-products acquisition channels, and more horizontal plays that are not necessarily pure acquisition plays but can also impact your retention and monetization. Think community-led channels.

6. Motion Focus Teams

A big one! Layering new Growth motions on top of PLG. Think Marketing-Led Growth (i.e., LifeCycle) and Product-Led Sales (the PLS teams 90% of B2B startups are buzzing about in this year’s annual planning).

🔴 Tier 3: Growth Enablers teams

Growth Enablers teams (enabling Tier 1 & Tier 2 bets)

7. Technology Enabler Teams

Building the infrastructure to support Growth teams’ fast “hypothesis - experiment - learning” loops. Both horizontal (i.e., experimentation, segmentation, etc.) and vertical (i.e., payments). For example, if you can’t set multiple experiments running simultaneously or segment those users who reached ‘AHA!’ but didn’t reach habit! You are in trouble.

8. Content Enabler Teams

Enabling those big bets that rely heavily on content generation, moderation (and even localization) at scale. Think Company or Community generated content at scale.

9. Operation Enabler Teams

Not your traditional team! It’s about removing Growth teams’ operation friction, upholding high operation standards, and running professional growth programs. Growth org can benefit significantly from the operations love touch, especially when the org is at scale.

It’s all from my end.

And this time, I will stop snacking post 10:00 p.m 😆

Eugene Segal

Share

Did you know less than 3% of SaaS companies reach the $100M+ ARR1 club?

It’s a long and hard journey. How long? Well, ten years is considered fast.

Growing your company to $100M+ is a true emotional turmoil. It doesn’t matter how bright you are; shit will hit the fan constantly. No fancy growth advisor or ex-Google exec hire will solve it. 💩

So what do you think you should do? You should try and control the amount sh*t flying your way by investing in Predictability. Understanding the ins and outs of structuring Growth Systems at every stage in your journey must be your priority.

Before we start, I want to ensure we speak the same language.

🤔 What the hell is a Growth System? In less than 30 sec.

Growth is about building Systems, not Hacks! Hence, Growth Systems.

Building Growth Systems to Generate Revenue Defensibly, Sustainably, and Predictably. Why? So you and your investors can sleep better at night ( = the ultimate goal). 🤣

Many mistakably argue that Growth = PLG (Product Led Growth). This is not correct. Growth is much more than just PLG. Growth layers multiple growth motions to acquire, retain, and mobilize users. PLG is just one of those growth motions. The others are MLG ( = Marketing Led Growth) and PLS (Product Led Sales).

Nevertheless, they do have something correct. PLG is THE starting point of your Growth journey; however, it’s insufficient by itself to get you to $100M+ ARR. We will see why in a bit.

Understanding the When, Why, Who, and How to layer those growth motions makes all the difference. And it’s exactly what we will explore in this blog post. 😉

☝️ Two more things:

First, you don’t do ‘Growth’ before getting to PMF (Product Market Fit). So, I assume your SaaS B2B ‘Unicorn in the Oven’ is post-PMF.

Second, although every company is nuanced, with its own one-of-a-kind growth and business models, companies that make the $100M+ ARR club have common patterns when approaching ‘Growth’.

In this article, I will talk to you about how I would approach evolving B2B SaaS Growth System based on best practices and patterns from companies such as Miro, Canva, Notion, and Slack and thought leaders such as Brian Balfour and Elena Verna so you can join the $100M+ ARR club members before 2060. 🤣

1️⃣ PLG (Product Led Growth) | ACV (Annual Contract Value) < $1K

⏰ When?

You reached PMF and have some money in the bank (Seed / Series A).

😵‍💫 Why?

You want to grow your ARR 10X in the next 2-3 years. So, you'll need to evolve your growth strategy beyond the founder-led growth and random WoM2, you have been doing until now. You need a predictable and repeatable growth system. 

😶‍🌫️ Who?

You can start with your narrow ICP3, focusing on providing value to individual users. You are not chasing unicorns but SMBs (1 to 100 employees). Take it easy.

😧 How?

1. You start with PLG. In PLG, the product generates demand ( = acquires new users) through virality and UGC4. Moreover, the product also captures the demand ( = monetizes those users) through the Activation, Engagement, and Monetization motions. Right now, the product is all you have. 😜

2. Start with setting up your Growth infrastructure, such as the data pipeline experimentation system, so that you can start iterating on your PLG hypotheses. Your goal should be to develop a growth model (micro and macro loops) around Acquisition, Retention, and Monetization that produces predictable and repeatable growth. It will be the base for your future growth!

3. You will go through many cycles of optimizing the growth model loops and innovating the model by adding new loops. How long? Don’t aim for less than two years.

2️⃣ MLG (Marketing Led Growth) | ACV < $10K

⏰ When?

You have a stable growth model and start getting an influx of low-intent users. Hence, your Retention and Monetization metrics drop because your product can’t properly Activate and Retain those users.

😵‍💫 Why?

1. You want to balance between demand generation and demand capture.

2. This means being able to generate significant demand ( = acquiring many more uses) and effectively capture value from them by Retaining ( = making sure the Activation and Engagement metrics don’t drop) and Monetizing( = making sure the conversion from Free/Trial to Paid doesn’t drop).

3. All that while accelerating the monetization cycles ( = getting paid faster). 😅

😶‍🌫️ Who?

1. You are extending your ICP definition and targeting SMBs and mid-market players (101 - 1000 employees). You want to start entering those high ACV (Annual Contract Value) logos early on and build up your foothold with those logos’ end-users.

2. You aim to provide value to individual user levels and teams, setting the groundwork for PLS (Product-Led Sales) in the next growth stage.

😧 How?

1. Add new Acquisition loops ( = Performance Marketing) so that both product and marketing will generate demand ( = More acquisition channels).

2. Increase your demand generation by globalizing your offering and localizing your product to capture global demand properly. 🌎

3. Add Retention and Monetization loops through Lifecycle, Education, Community, Content, etc. 

4. Unlock team-level value by extending to adjacent use cases within your ICP and expanding your initial ICP definition. You must ensure it makes sense for a team (not only individual users) to use your product. Don’t fake it; it should be real team value. At Miro, it’s the collaboration magic bullet; at Slack, it’s the direct network effect ( = the more users within your team using Slack, the more valuable Slack is for those users).

5. You will probably need to raise Series B to fuel the spending on R&D, Marketing, and ‘Headcount’ ( = I hate this word). 

Subscribe now

3️⃣ Layering on PLS (Product Led Sales)| $10k to $100K ACV

⏰ When?

You observe a significant usage within multiple logos in the mid-market and enterprise segments. 

😵‍💫 Why?

1. You observe a clear benefit in high touch5 telling your product's value story. Going upmarket6, your story must convey how your product provides individual, team, and company-wide value.

2. You observe monetization friction (Credit Card limits, procurement processes, etc.) when closing high ACV accounts (above $10k - $20k) in Self-Serve7. You need a high touch to help the deal go through and capture the demand.

😶‍🌫️ Who?

You are going upmarket (not the whole way, though), focusing on mid-market and the lower end of the enterprise segments. Expanding those logos will get you those high ACV, high NDR8 ( = Net Dollar Retention) yummy deals your investors are bugging you about.

😧 How?

1. Build the PQA (Product Qualified Accounts) pipeline. PQA is a score you give a mid-market / enterprise account to set the probability of Sales expanding this logo. The score is based on a bunch of real-time Product signals. The secret source is in how you define those signals. 😉 And yes, it’s the Product that is generating demand.

   Remember, those signals wouldn’t be there in the first place if you hadn’t started with PLG and continued layering new growth motions.

2. Set up your sales operation. Sales are capturing the demand in PLS. Once the magic PQA bulb goes on, it’s your Sales team show time. Your Sales team can reach out to the buyer persona ( = the person that actually makes the buying decisions) and do their thing.

   Be aware that having the PQA bulb on doesn’t guarantee success; you must work the account. It does make it easier, however. Especially if the buyer persona is already a user. 🔥

3. You are going upmarket, and this adds complexity. The good news is that you are still not chasing those high-end enterprises. So, you can gradually layer on the different facades of the complexity of the enterprise segment.

   1. Product Complexity: Balancing between the enterprise roadmap (security, permissions, reporting, documentation, etc.) and the Self-Serve roadmap

   2. Process Complexity: Balancing between the slow enterprise GTM / Success / Support / IT cycles and the fast Self-Serve segments iterations cycles.

   3. Cultural Complexity: Balancing between the Sales focus and User focus.

How to work with me?

4️⃣ Layering on SLG (Sales-Led Growth) | ACV > $100k

⏰ When?

You have been running the PLS pipeline for some time and iterated on the enterprise product offering. You are ready to take on the additional complexity of layering on the SLG.

😵‍💫 Why?

Many enterprise-grade companies (tech giants, financial institutions, healthcare, government, etc.) have strict external software procurement policies, so you can’t penetrate those giants with initial usage. No initial usage = no PLS. Hence, you must layer on the traditional sales motion (SLG) to generate demand. 

😶‍🌫️ Who?

You continue the upmarket journey, this time the whole way through. 😎 Focusing on the entire spectrum of the enterprise segment.

😧 How?

1. Set up your high-touch pipeline. It’s the MQL9 ( = Marketing Qualified Lead) to SQL10 (Sales Qualified Lead) operation in which Marketing and Sales drive the show. Sales (and Marketing) generate demand, and Sales captures the demand.

   SLG is expansive. You will probably need this Series C to make it happen. Nevertheless, the monetization loop is fast; you can scale it, and the retention with the high-end enterprise segment is through the roof.

2. Continue navigating through the product, process, and cultural complexity that comes with the territory. The higher you go, the more restrictive it gets.

😉 The bottom line:

To reach the $100M ARR mark, you must go upmarket and get those yummy $100K+ contracts.

However, just as in the academic world, where you don’t start your journey by writing a Ph.D. thesis but with a bachelor's degree, in a B2B SaaS startup world, you don’t begin by chasing unicorns 🦄.

You start by targeting SMBs through PLG motion and gradually layering on complexity and additional growth motions (PLM, PLS, SLG) while going upmarket. Not the other way around!

PLG is the base for your growth.

PLG is how you get the initial footstep into those high ACV prospects.

PLG is your competitive advantage when capturing enterprise demand high touch ( = sales).

Getting upmarket can take 3 to 5 (or more) years.

Have patience. 🙏

Eugene Segal

1. Founders / CEOs

2. Product Leaders

3. Growth Product Leaders

4. Growth Marketing Leaders

5. Growth Design Leaders

6. Growth Analytics Leaders

7. Growth Engineering Leaders

❤️ Why should you care?

Did you know that Canva’s ($40B val.) Growth org is 400+ people? They care!

Who else cares? Grammarly, Airtable, Snyk, etc.

Just take a look at the Forbes ‘The Cloud 100’ list

✅ What do you get?

The guide has five sections:

1. Growth Marketing Teams (5 learnings)

2. Product Acquisition Teams (5 learnings)

3. Product Retention Teams (8 learnings)

4. Product Monetization Teams (6 learnings)

5. 🎁 Bonus Tips (Best for Last) (6 learnings)

😑 Before we start!

Growth is about building systems (not hacks) to generate $$$.

You do it by leveraging your Product, Marketing, and Sales work in symbiosis to Acquire, Retain, and Monetize customers predictably, sustainably, and defensibly.

I will niche down to provide the most actionable value in this guide.

I will focus (mainly!) on scaling the Growth org through the lens of PLG.

This means leveraging your product to acquire, retain, and mobilize customers.

Now, we are ready.

Share

🏁 Let's start!

Growth Marketing Teams

1. Growth Marketing is your partner in crime!

   Growth Marketing is much more than a leads pump! Yes, they bring new users in ( = Performance Marketing). But they also bring existing users back ( = Lifecycle).

2. Lifecycle + Retention = ❤️

   When Lifecycle brings users back, it re-enforces Retention ( = Activation + Engagement). Lifecycle is a massive opportunity. Lifecycle deserves a fully staffed team (or a group)! Give them wings!

3. Lifecycle is in-between!

   If, in your Growth model, Lifecycle plays the first chair. Bring them to the Growth Product org (from the Growth Marketing org). Sorry, Growth Marketers...

4. Performance marketing is an expert’s game.

   Leveraging channels (Paid, SEO) requires domain expertise per channel. Hire the Head of Growth Marketing to scale your Performance Marketing machine one acquisition channel at a time.

5. Pro tip! 😎

   Channels are many; not all channels are acquisition channels. Email, SMS, Google Ads, Product Notifications, etc. are all channels. Figure out early on who owns which channel and how they scale and sync. It’s a company-level collaboration!

Subscribe now

Product Acquisition Teams

6. Product Acquisition compliments Growth Marketing!

   In the PLG land, your Product is your acquisition channel! Here, both Growth Marketing and Product Acquisition bring in new customers. Leverage both!

7. Virality rules!

   If your core product is blessed with the virality gods (not every product is), meaning existing users can bring in new users, bank on it! It’s way beyond the ‘Invite’ and ‘Share’ experiences; find and manufacture those magic moments. There is so much to do here!

8. Bet on content!

   Content should be on top of your mind. Figure out how to leverage Company / User / Community Generated Content. Content is a huge acquisition play. It’s also a big lift and requires a company-wide collab (SEO, Brand, Community, etc.)

9. Give your website spinach! (Popeye reference…)

   Your website matters! Help users experience value before they reach your Core Product. It’s the easiest channel to run experiments on! Your website deserves attention. It’s where so many users land.

10. Pro tip! 😎

    Experiment with pre-product experiences! In addition to the website. Dedicated experiences targeted at specific segments. Think about it as Level 100 landing pages on steroids. Treat it as an additional channel to acquire users.

Product Retention Teams

11. Activation (always) first!
    If we go Reforge. Retention = Activation + Engagement + Resurrection. Start with Activation, not with Engagement (on Engagement more in a bit). Give Resurrection to Lifecycle. Activation is your first priority!

12. Activation is beyond the first session!

    I we go Reforge again. Activation happens when a user creates a Habit around your Product. It’s a long journey! Getting from Setup to Habit can take weeks. The first session is only part of it... (although the most critical one).

13. Scale activation teams by journey!

    Scale teams to own journeys. For example, supply/demand, creator/joiner, etc. Each owns an entire journey (Setup - Aha - Habit). Don’t scale teams by Activation moments (Setup / Aha / Habit)!

14. Generic experience sucks!

    Qualify users early on! Say no to generic experiences. Personalize to activate. Personalize each journey by persona, use case, proficiency, entrance point, session, previous actions, etc. Onboarding questions work! Do it!

15. Keep your finger on the pulse!

    Work closely with Growth Marketing and Product Acquisition to monitor how each segmented cohort activates compared to the forecast/growth model. Always know what’s going on. Remember! Users that can’t be activated can’t be monetized!

16. Don’t use templates as an excuse!

    It’s true; Templates are a silver bullet feature (mostly...) for getting users Activated / Engaged. However, don’t be lazy. If your product experience sucks, Templates won’t fix it. Here I said it! 🤣

17. Engagement is a company play!

    Don’t spin one Growth team expecting it to fix user Engagement. Empower the entire company to think and breathe Engagement. You know, non-engaged users churn!

18. Pro tip! 😎

    It’s not about feature adoption but about adopting the right feature by the right user at the right time to solve an actual problem and drive delightful engagement. You can’t scale otherwise. Delightful Engagement > Feature Adoption.

Subscribe now

Product Monetization Teams

19. You own Self-Serve (SS) ARR! 💸

    Yes, Growth owns the SS ARR. Because if you do, your mindset changes. The way you think about Monetization changes. Both new, expansion, and churned revenue become your game.

20. The Monetization model is a fair yet cautious play!

    The Monetization Model (per Reforge) is all the how much (price), what (features), and when you charge Qs. Those are the big lever, high-risk plays. Model it! Align with leadership! Advise with experts! And tread very lightly.

21. Scale teams around the monetization journey!

    Align your Monetization teams across the monetization journey. Think free/trial to paid, expansion, and churn. The journey is the output of your growth and monetization models. No one structure fits all!

22. Bet on Monetization infrastructure!

    Make it damn easy to pay and cheap to transact for you and the customer. This requires significant infrastructure investment. Out of the box, Stripe-like solutions are just a starting point. Build on top. Localize, globalize, and optimize the payments realm!

23. You need an expert talent!

    To play with the monetization model, you need an experienced Growth team. Especially experienced Product and Analytics talent. To play with monetization infrastructure, you need domain experts. Focus on domain expert Product and Engineering talent.

24. Pro tip! 😎

    The quality of your monetization, both low touch (self-serve) and high touch will be determined by the quality of your retention (activation and engagement). You can’t win monetization in Silo!

🎁 Bonus Tips

25. Layer on PLS on PLG!

    Dear B2B, Product Led Sales works! It’s a fact. If you did your PLG right, you can start layering on PLS to qualify the high-tier (Enterprise) accounts. PLS complements sales; PLS doesn’t replace sales. PLS deserves a dedicated team!

26. Community-led growth is big!

    In the context of Growth Product, think Community Generated Content. High-quality Community Generated Content fuels your Acquisition and Retention Loops. Miro did a superb job with building Miroverse. People trust People!

27. Infrastructure, again!

    You can’t scale growth org without enabling this scale through proper infrastructure. Both horizontal (Experimentation and Localization) and vertical (Marketing Tech and Payments). You need to spend some to get some!

28. Bring in cross-functional leadership!

    When you scale, hire Heads of Growth for Analytics, Product, Engineering, and Design to lead the growth org. The same goes for (most) groups of teams within the org, Product Retention, Product Monetization, etc.

29. Rockstart DNA!

    Rockstar growth teams own the forecast, experiment a lot, fail most of the time, are amazing at distilling actionable learnings, and make allies by empowering other teams through sharing those learnings.

30. Breaking the rules!

    Don’t be bound to the Acquisition - Retention - Monetization model of how to structure teams. There is no one right way. There are only guiding principles. Each company is different. Each growth model is unique. Experiment!

You can also check out the slick PDF version of this write-up. 👇

How I Scale (growth) Teams 30 Learnings Final

2.88MB ∙ PDF file

Download

Download

1. Founders / CEOs

2. Product Leaders

3. Growth Product Leaders

4. Growth Marketing Leaders

5. Growth Design Leaders

6. Growth Analytics Leaders

7. Growth Engineering Leaders

❤️ Why should you care?

Easy! Learn from my mistakes at Miro so you can set yourself and your team up for success.

✅ What do you get?

The guide has five sections:

1. Target Metrics (5 learnings)

2. Experimentation Portfolio (10 learnings)

3. Team (3 learnings)

4. Leadership Buy-In (2 learnings)

5. 🎁 Bonus Tips (Best for Last) (10 learnings)

😑 Before we start!

Experimentation is a team sport; you and your team are playing it together.

Now, we are ready.

Subscribe now

🏁 Let's start!

Target Metrics

1. Your target metric represents a complex action!

   Break the metric down! Otherwise, with a single experiment, you won't be able to move it. In Miro's case, the core actions revolve around collaboration. Not a walk in the park.

2. Your target metric is lagging!

   The impact on the metric can be observed only in X weeks. Activation (for example). Focus on leading indicators! But only those that you proved to be correlated with the target metric. Don't cheat,

3. Your target metric is a business metric not aligned with the users' problem!

   Iterate on the target metric! Be aware that you will need strong leadership buy-in to make this happen.

4. Your experiments cannibalize other teams' target metrics!

   Calculate the impact on a higher-level business metric (Engaged Users, ARR, etc.)! Groom your relationships to work such cases effectively.

Your success is perceived only as impact on the target metric!

Change your success criteria! Success = High value and actionable learnings, whether the hypotheses were proved or disproved.

Experimentation Portfolio

6. You are running only 'quick win' experiments!

   Mix it up with big bets! Otherwise, you limit your impact, leading to a long-term lack of leadership buy-in.

7. You are running big bets backed by low-confidence hypotheses!

   Sequence the experiments! Run small experiments to validate your bigger hypotheses.

8. You are spread on too many opportunities and jumping around!

   Focus and iterate! Experiments rarely work on the first attempt. Post-analysis and iteration are key to making it work.

9. You experiment everything!

   Not everything should be an experiment! If cost > return and/or potential learnings are of low value, don't experiment. Experimentation culture doesn't obsolete logic and sense.

10. You are looking for the magic framework to prioritize experiments!

    Don't overcomplicate it! Considering the impact, confidence, cost/complexity, and sequence should be sufficient.

11. You are an estimation optimist!

    Although people are skeptics in life, they become optimists when it comes to estimations. Discount your experiments! Genuinely evaluate your hypothesis confidence.

12. You set OKRs on the number of experiments or the experiments' success rate!

    Stop! It diverts the team from focusing on impact and learning. Don't do it unless you are just setting up the team and want to get some quick wins going.

13. The growth forecast (and OKRs) is not aligned with the estimated team experimentation portfolio impact!

    Go back to the drawing board! Both in terms of forecast and expectations from your team. Work through the gap before signing the Q off.

14. You slack on post-analysis.

    Brrr... Now I am getting angry! Post-analysis is the most important part of experimentation. The quality of post-analysis determines the teams' success! For that, teams should be adequately staffed. A Dedicated Product Analyst!

15. Your experiments' priorities are driven by infrastructure debt!

    Can't properly segment or have clashing experiments. Make a business case to prioritize experimentation infrastructure work! Your infra must evolve in tandem with your teams' experimentation skills.

Subscribe now

Team

16. Your team setup is incomplete (baby team)!

    APED is your MVP! PMs should not 'do it all'.

    1. A - Analytics

    2. P - Product

    3. E - Engineering

    4. D - Design

17. Your team setup is incomplete (mature team)!

    For mature teams, aim for (AMPED+R) team structure!

    1. A - Analyst

    2. M - Marketing

    3. P - Product

    4. E - Engineering

    5. D - Design

    6. R - Research

18. You have a hiring quality gap!

    Hiring for growth teams is different from hiring non-growth product teams. This applies to both Product, Design, Engineering, and Analytics. How different? Reach out, and I will share.

Leadership Buy-In

19. You have an executive buy-in problem!

    Experimentation is not less people business than numbers business! Over-communicate research insights, experiments learnings, your process and experiments sequence, and spin up cross-company ideations sessions.

20. You have a cross-company stakeholders' buy-in problem!

    Make teams around you successful! Enable other teams with your learnings. Help cross-functional team to achieve their OKRs. The best recipe for LOVE is mutual success.

🎁 Bonus Tips (Best for Last)

21. Reforge is mandatory but not sufficient!

    Reforge thinking should guide your thinking. However, it's not a magic bullet to solve all your problems. Don't do something that doesn't make sense to you just because Reforge says so.

22. (Growth team) A twelve-month experimentation roadmap is not a thing!

    Detailed long-term roadmaps contradict Growth DNA. Three months of experiments portfolio planning should be your roof-shot time horizon.

23. The Bayesian approach is not a curse word!

    Don't limit your experimentation stack! There are pros and cons to the Bayesian approach. Bayesian is flexible, especially for small improvements, and valuable when running many experiments. Be smart about it!

24. Monitor running experiments!

    Don't just leave them alone and sad. Monitor, not for concluding the experiments early on but to detect potential errors and save time. Both PMs, Analytics, and Engineers should monitor running experiments. Each has an angle.

25. Gradually push the limits on the complexity of experiments you run!

    Focus on optimizing the time it takes to set the experiments up and decreasing the error level. Experimenting with business model changes is the hardest!

26. Seasonality and poor traffic should not be your go-to excuse for not hitting targets!

    Those should be already embedded in the forecast.

27. Research is gold, but don't research for the sake of research!

    First, leverage existing company-wide research outcomes. Research is a $ investment. Procrastination by Research is a thing.

28. Always know what's next!

    You should always be ready to answer what you plan to do next per each different future outcome of an experiment.

29. PM / Analytics relationships tend to be overlooked!

    Nothing can break the trust between PMs and Product Analytics folks more than PMs finding (not on a one-time basis) mistakes in PA's work.

30. Experimentation is awesome!

    The learnings you bring to the table can fundamentally change the company’s strategy and influence other team roadmaps and decisions.

You can also check out the slick PDF version of this write-up. 👇

Why Do Experiments Fail 30 Learnings Final

898KB ∙ PDF file

Download

Download