From Zero to a Million Users - Dropbox and Xobni lessons learned

Zero to a Million Users
@drewhouston, @asmith

@drewhouston
(dropbox)
@asmith
(xobni)

Summer 2006: Humble beginnings

Xobni, Dropbox – VC-backed startups in SF
Both reached 2 million users in 2 years
2 ,000,000
0

Biggest risk: making something nobody wants

Weak product-market fit cannot be
fixed by good marketing
Good marketing will not fix a bad product

But good product will be wind at your back

Xobni Analytics: Solved problem no one had

Goal: product-market fit ASAP

learn early, learn often

Cost of change at each stage
Idea
Prototype
Launch

Learning on a $0 budget: Talk to people!

Learn without launching
AdWords tests
Hacks: Fake landing pages, screenshots, etc.

Dropbox’s minimum viable product:
3 min screencast on Hacker News (Apr 07)

Simple landing page: capture interest/email address

starting from zero

Go where your early adopters hang out

Private beta launch video  12,000 diggs; beta waiting list jumps from 5,000 to 75,000 in one day (Mar 2008)

Avoid ghost towns: bootstrapping to critical mass

Niche first, world later

Fake it till you make it: Aardvark & simulating features that weren’t ready

marketing: building buzz

Tie yourself to a bigger trend

Adam
Meet journalists in person. All the time.

Journalists are really busy – come up with the angle for them.

Media resources page on web site

Word of mouth rule #1: have a great product

Generate word of mouth with scarcity

Help users generate tell their friends

Invite screen
Facebook pictures
Auto-ranked
Outlook detection via looking at mail headers
= FUN!

Sex it up! Have fun!

Inbound marketing / “social media”

how do you get people to use your product?

Focus: do a few things really well instead of a lot of things poorly

Every 10% easier  50% larger audience

Don’t make me think: No decisions  nothing to screw up

Don’t make me read, either:Designing landing pages & signup flows
early beta
concise beats comprehensive
call out the next step
simple converts better
late beta

Hook the user first, educate over time(tours, tip emails, etc.)

You do not see the same product your users do! (craigslist, usertesting.com)

Make feedback painless – then iterate!

how do you make a product that spreads itself?

The best products turn users into evangelists

Encouraging word-of-mouth: Referral program increased signups by 60%

Tricks of the trade: FB & Twitter feed, emails, contact list importers
Trailing 30 days: 3 million invites sent

metrics: know thy funnel

Users
$$$
Basic funnel

Startup Metrics for Pirates. Live it.

Output I: know where to invest marketing $$

Xobni finding: AdWords users don’t convert to paid BUT they refer others who do!

Output II: allocate engineering resources between usability, engagement, & virality

Example: user education around people search

scaling without virality:“dollar in, dollar out” marketing

Some markets don’t elicit virality or buzz

Netflix example
(numbers not exact)
($16 rev - $10 svc cost) per month  $6/mo
x 22 mo lifetime= $132
$40 advertising, affiliates, etc.
$92 lifetime gross margin/user

a quick taste…

example user acquisition costs

example monthly rev per user

example monthly churns

example freemium conv. rates

Thank you!
Questions?
Feel free to reach out!
@drewhouston - drew@dropbox.com
@asmith - adam.smith@xobni.com

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From Zero to a Million Users - Dropbox and Xobni lessons learned

by Adam Smith on May 04, 2010

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