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10 Insights on Startup Growth Strategies — Sean Ammirati

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Sean Ammirati joined Birchmere Ventures in 2012 to as the partner leading Birchmere Labs, a seed and studio fund focused on community driven commerce startups.

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10 Insights on Startup Growth Strategies — Sean Ammirati

  1. 1. Powered by
  2. 2. This presentation consists of highlights from the interview with Moe Abdou, founder & host of 33voices®.
  3. 3. Sean Ammirati is a Partner at Birchmere Ventures, an early-stage ven- ture capital firm based in Pittsburgh, PA, and Palo Alto, CA, and is an Adjunct Professor of Entrepreneurship at Carnegie Mellon University. Most recently, he was the COO of ReadWriteWeb, one of the most influential sites about the future of technology and innovation. Sean was previously co-founder and CEO of mSpoke, a big data SaaS com- pany. Sean Ammirati @SeanAmmirati Partner at Birchmere Labs
  4. 4. Don’t confuse starting a company with scaling one, for the startup is hardly a smaller version of the bigger company. Exponential growth is likely to leverage one of these four catalyst: Insight #1
  5. 5. Don’t confuse starting a company with scaling one, for the startup is hardly a smaller version of the bigger company. Exponential growth is likely to leverage one of these four catalyst: Double Trigger Events - Random events that increase awareness Insight #1
  6. 6. Don’t confuse starting a company with scaling one, for the startup is hardly a smaller version of the bigger company. Exponential growth is likely to leverage one of these four catalyst: Drafting off of Platforms - An existing platform that needs your solution to augment their expe- rience Insight #1
  7. 7. Don’t confuse starting a company with scaling one, for the startup is hardly a smaller version of the bigger company. Exponential growth is likely to leverage one of these four catalyst: Optimizing Algorithms - Leveraging existing software to elevate your solution Insight #1
  8. 8. Don’t confuse starting a company with scaling one, for the startup is hardly a smaller version of the bigger company. Exponential growth is likely to leverage one of these four catalyst: Viral Growth - Your existing customers become your most important promoters Insight #1
  9. 9. Insight #2 Smart founders scale strategically, and never prematurely. Their most critical tasks early-on are:
  10. 10. Insight #2 Smart founders scale strategically, and never prematurely. Their most critical tasks early-on are: To acquire new customers
  11. 11. Insight #2 Smart founders scale strategically, and never prematurely. Their most critical tasks early-on are: To delight those customers with their solution
  12. 12. Insight #3 For any idea to be scalable, it must have these two ingredients:
  13. 13. Insight #3 For any idea to be scalable, it must have these two ingredients: Projected Economies of Scale
  14. 14. Insight #3 For any idea to be scalable, it must have these two ingredients: Large Total Addressable Market
  15. 15. Insight #4 Reid Hoffman on the key considerations of Blitzscaling:
  16. 16. Insight #4 Reid Hoffman on the key considerations of Blitzscaling: When do you Blitzscale?
  17. 17. Insight #4 Reid Hoffman on the key considerations of Blitzscaling: Once you scale, you move from generalists to specialist - are you ready?
  18. 18. Insight #4 Reid Hoffman on the key considerations of Blitzscaling: As you scale, you move from: • Everyone in the same room who are all doing • People who are managing people and people who are doing • Executives who are focused on scaling the organization, managers, and people who are doing
  19. 19. Insight #4 Reid Hoffman on the key considerations of Blitzscaling: Need to preserve innovation while scaling
  20. 20. Insight #4 Reid Hoffman on the key considerations of Blitzscaling: Preserving adaptation vs operational excellence; moving fast means you will have operational wastage
  21. 21. Insight #4 Reid Hoffman on the key considerations of Blitzscaling: Global reach - be strategic
  22. 22. Insight #4 Reid Hoffman on the key considerations of Blitzscaling: Capital requirements - Either have a good revenue model that you are reinvesting into operations - or raise money through funding.
  23. 23. Insight #5 Successful startups often add constraints to their products to ensure that the essence of the product experience is a positive one. McDonald’s patriarch on his first McDonald’s experience: I was fascinated by the effectiveness of the system they [the McDonald brothers] described that night. Each step in producing the limited menu was stripped down to its essence and accomplished with minimal effort.
  24. 24. Insight #6 Here’s an important question for a founding team to ask once they’ve proven their product/market fit: Where are large groups of engaged potential customers, who are frustrated because they aren’t aware of my solution, spending time today?
  25. 25. Insight #7 Your current customers can be one of your most significant growth engines as you scale an innovative product or service provided you:
  26. 26. Insight #7 Your current customers can be one of your most significant growth engines as you scale an innovative product or service provided you: Reduce the friction at the point when they are most likely to make a referral
  27. 27. Insight #7 Your current customers can be one of your most significant growth engines as you scale an innovative product or service provided you: Measure the effectiveness of different interactions to increase sharing
  28. 28. Insight #8 The start of making data-informed decisions is to make sure that you’re asking the right questions. Be clear on:
  29. 29. Insight #8 The start of making data-informed decisions is to make sure that you’re asking the right questions. Be clear on: What the critical metrics for your business are?
  30. 30. Insight #8 The start of making data-informed decisions is to make sure that you’re asking the right questions. Be clear on: What the right goals for those metrics are?
  31. 31. Insight #8 The start of making data-informed decisions is to make sure that you’re asking the right questions. Be clear on: How you can best publicly display the metrics being used?
  32. 32. Insight #8 The start of making data-informed decisions is to make sure that you’re asking the right questions. Be clear on: How you can encourage a culture of experimentation?
  33. 33. Insight #9 At its core, a business with a network effect is one in which the value of the solution exponentially increases as more customers take advantage of it; simply because new users want to interact with existing ones. Think Facebook.
  34. 34. Insight #10 “With great companies, the consumers buy because the product is so good. They aren’t spending [tens of millions] on marketing.” - Bill Gurley
  35. 35. Reflect - Can viral be a strategic approach to growth in your business? tweet us!
  36. 36. Get the book
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