Created after attend Growth Hacker Conference in San Francisco in 2013, this presentation is a summary of several major take aways from speakers at the event, including Sean Ellis.

1. Startup Stages of Growth
By Will Fraser, Chief Squatch
Referral SaaSquatch
The Customer Referral Program for Web Apps

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TL; DR
Growth
Transition to Growth
Product/Market Fit
There are three stages of growth every high growth startup will go through:

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Where it came from
Sean Ellis, the First Marketer at , talks about
the Startup Stages of Growth.
He combined his real-world experience and collaborated
with other growth experts to come up with the concept.

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What Really Matters; When
The first year of a company’s life greatly influences its chances of success
because of issues like:
pre-mature scaling,
not enough customer engagement,
and poor pricing models.
The trick is to figure out not only how to address these
problems, but when to.

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Some Data to Back it Up
“74% of high growth internet
startups fail due to premature
scaling.” – Startup Genome Project, Study on pre-mature scaling

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How The Pyramid was Built
Sean discovered the importance of this concept by taking many
short-term roles with different startups.
During this time he got to work at some great companies
( ) and ultimately built the Stages of Growth model
to help future entrepreneurs.

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The Growth Stage Pyramid
The objective of this model is to help you
understand, not just the stages of growth, but how
they are built on top of each other like the layers of a
pyramid.

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The Foundation
When you can build a strong foundation of Product/Market Fit you have a great
chance of growing your startup.
This is why you need to focus obsessively on finding Product/Market Fit with no
concern for scaling.
When you don’t have Product/Market Fit,
you aren’t providing any real, sustainable
value to your customers.

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All Businesses are Pre-Product Market Fit
or Post-Product Market Fit
How do you determine if your company is Pre-Product/Market Fit
or Post-Product Market Fit?
Sean proposes a single question to quantify if you have product
market fit. He suggests you ask your customers:
How would you feel if you could no longer use this product?

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Market Fit
These are the people that are really getting value from your
product, and are the people that are going to help you grow it.
If you have at least 40% of respondents confirm they would
miss your product you have achieved the first stage and can
start to move forward.

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Market Fit
If you ask this question, and don’t hit the 40% mark, don’t panic!
You simply need to be responsive, iterate and measure again.
Talk to those customers that did say they would miss your
product, and understand exactly why.
Focus on what you learn from these real conversations and
continue to move forward.

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Transition to Growth is just execution
It’s important to note that it’s a Transition and the Stages of Growth
model doesn’t go right from Product/Market Fit to Growth. This
middle step is required because in the Product/Market Fit stage you
spend so little time on growth that you really aren’t ready for it.

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Key Growth Transition Activities
Implement user analytics
Identify “must have benefits”
Map benefit to context
Improve your business model
Optimize conversions
Hire a growth team

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Transition to Growth
Most optimization tasks do not become a priority until
after the Product/Market Fit stage is complete.
I point this out because as an entrepreneur it can
become addicting to polish your product until it’s perfect.
However, this typically leads to a lot of lost
time and effort if you don’t already have
Product/Market Fit.

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Tips for Transition to Growth
Conversion rate = desire – friction
This simple equation explains the entire complex world of
increasing conversion rates.
If you can increase a users’ desire or reduce the friction
required to convert, you will increase your conversion
rate.

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Tips for Transition to Growth
Optimize funnel on delivering must have benefit.
Ask your users “What is the primary benefit that you have received
from our product?”
Arrange the common answers into a multiple-choice questionnaire
and present them to your remaining customers.
This will help to drill down to the core of what people find valuable
about your product so you can optimize your conversion funnel on.

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Introduce the Growth Hackers
At this stage the exciting growth hacks we all like to read
about can actually work.
The size of your growth team isn’t overly important, they
often range from 3 – 50 people.
You must create a culture of growth and then put the
right skills on the growth team.

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Conclusion
Growth
Transition to Growth
Product/Market Fit