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Scaling Growth | Gustaf Alstromer, YC Partner (formerly Airbnb) & Ed Baker (formerly Uber)
29 segments available
Gustaf Alstromer, YC’s newest Partner (formerly product lead for Growth at Airbnb) joined a panel with Ed Baker, (former Head of Growth at Uber), to share tips on growth experiments and team dynamics at a scaling company.
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The Evolution of Growth Teams
Gustaf Alstromer and Ed Baker reflect on their experiences building growth teams at Airbnb and Uber. They discuss how these teams have evolved over the years, highlighting the transition from small groups to larger, more structured organizations focused on scaling user growth. This segment sets the stage for understanding the dynamics of growth in tech companies.
"what's pretty cool is uh we have two guys who've been living the center of building up these growth teams kind of for the past you know seven or eight years um Ed joined Uber to start the growth team ..."
The Viral Growth Explosion
Ed Baker shares insights from the summer of 2007 when Facebook launched its platform, leading to a surge of viral growth through innovative apps. He discusses the experimentation that took place during this period and how it shaped his understanding of growth, emphasizing the blend of art and science in creating successful viral strategies.
"know we were all started back when sort of this idea of a growth team this idea of a team that's focused on this sort of intersection of product and marketing to to build stuff was pretty novel and al..."
Zodiac Photo Album: A Viral Sensation
Ed recounts the creation of the Zodiac Photo Album app, which achieved massive virality by tagging friends in a photo album based on zodiac signs. This segment illustrates the clever tactics used to leverage Facebook's platform for exponential user engagement and the subsequent reaction from Facebook's platform team.
"it was a great uh platform on which to just experiment with a lot of different ideas because it was so easy to build these simple Facebook apps and just run lots of ab tests and so much of I think fig..."
Mobile Growth Strategies at Voxer
Gustaf Alstromer discusses his journey into growth through his work at Voxer, a walkie-talkie app. He emphasizes the importance of optimizing user experience by matching phone numbers with address books to enhance user engagement. This segment highlights the unique challenges and strategies involved in mobile growth compared to social platforms.
"we were allowed to tag like 20 people per photo so it would show up to 20 of your friends per zodiac sign times 12 so with one click you tag 240 friends and all 240 people would get an email saying Ed..."
The Shift to Retention at Facebook
Ed Baker reflects on his transition to Facebook's growth team, where the focus shifted from acquiring new users to retaining and engaging existing ones. He discusses the importance of friending features and how they drove user retention, marking a significant change in growth strategy as the platform matured.
"on mobile which people think is a lot harder even than social was um so before Voxer I was at company called heson where I co-founded and it was an product like a messaging product on mobile that we c..."
Building a Structured Growth Team
Ed Baker shares insights on the structure of Facebook's growth team, which included various functions like product, engineering, and analytics. He explains how these roles collaborated to drive growth and how he applied these learnings when establishing the growth team at Uber.
"you can do with those things with Voxer uh when I joined the the most important thing so Voxer was a walkie-talkie app on IOS and Android you push a button you start speaking in the other in the other..."
The Role of Metrics in Growth
Gustaf Alstromer discusses the evolution of growth teams and their responsibility for metrics and experimentation. He highlights how the role of growth teams has changed, with a greater emphasis on data-driven decision-making across all company functions, rather than being isolated to a single team.
"interest of the users and sometimes you forget like why you do things um so Ed I remember your company got acquired by Facebook and you kind of jumped into a little bit more mature growth team at Face..."
Leveraging Experience for Growth
Gustaf Alstromer reflects on his experience at Airbnb, where he joined a team with a wealth of knowledge in experimentation and data science. He discusses how this environment facilitated the growth team's ability to implement effective strategies quickly, showcasing the importance of having the right tools and support.
"biggest uh differences and most of the growth team at Facebook at the time was actually focused on friending because we discovered at Facebook that friending was the number one driver of retention and..."
Building Growth Teams from Scratch
Gustaf Alstromer shares insights on forming growth teams at Uber and Airbnb, emphasizing the importance of having dedicated team members for each function. He reflects on the lessons learned from Facebook and how they shaped his approach to building effective growth teams in new environments.
"across all those different functions in fact all of all of analytics back then was part of the growth team um and uh I kind of took a lot of those learnings when I went over to Uber um and started our..."
The Evolution of Growth Teams
Alstromer discusses the changing role of growth teams in startups, highlighting how they have transitioned from being solely responsible for metrics to becoming evangelists for data-driven decision-making across the entire company. He notes the importance of experimentation and metrics in modern growth strategies.
"Facebook well and and you know that's a perfect transition because when I've been talking to a lot of people about sort of what the real success of uber and Airbnb I mean Joe gave a great talk about s..."
Northstar Metrics: Defining Success
The conversation shifts to the concept of Northstar metrics, with Alstromer explaining how they differ between companies like Facebook and Uber. He emphasizes the significance of having a clear metric that aligns the growth team's efforts and drives overall company success.
"how did you kind of start that this sort of practice from what you'd learned before um sure so I think the can't speak for but like I think the initial idea of a growth team is that there's some funct..."
Challenges of a Two-Sided Marketplace
Alstromer elaborates on the unique challenges faced by growth teams in two-sided marketplaces like Uber. He discusses the necessity of balancing metrics for both riders and drivers, and how this complexity influences growth strategies and decision-making.
"I think really great companies today they have everyone kind of carrying about metrics using experimentation and doing um all those things that growth teams do to make decisions so I think things have..."
Real-World Challenges in Growth
In this segment, Alstromer highlights the real-world components of Uber's growth funnel that cannot be measured online. He shares personal experiences that illustrate the hurdles new drivers face, emphasizing the importance of understanding user behavior in a physical context.
"and I learned a ton from all those people and it's been pretty pretty incredible but yeah in the very beginning we like everyone else had um and had always been an incredible product um and as a compa..."
Paid Acquisition vs. Organic Growth
Alstromer contrasts the approaches to user acquisition at Facebook and Uber, discussing the necessity of paid marketing in a competitive landscape. He explains how Uber's growth strategy evolved to include performance marketing, integrating it with product and engineering teams.
"that's what we've been doing um but I think yeah the role of the growth team have changed um from being that evangelizing team that that do all all of it to kind of evangelizing the rest of the compan..."
Understanding Customer Lifetime Value
This segment focuses on the complexities of calculating customer lifetime value (LTV) in a two-sided marketplace. Alstromer discusses the challenges of determining the worth of riders versus drivers and how data science teams at Uber tackled this intricate problem.
"think that's actually really important for sort of the growth discussion definitely so at Facebook it was monthly active users it's basically the one metric that if you talk to the way I like to think..."
Leveraging Growth Opportunities
Alstromer shares insights on how large companies leverage paid marketing to accelerate growth. He discusses the importance of understanding market dynamics and the value of scaling quickly to achieve operational efficiencies in a two-sided marketplace.
"Uber when we came up with our Northstar metric we had to consider their two sides of the marketplace so it's not just monthly active Riders um ultimately we decided on trips weekly trips as the Norths..."
Navigating Market Constraints
In this segment, Alstromer discusses the varying market constraints that affect growth strategies. He explains how different geographical and seasonal factors influence the value of riders and drivers, and how Uber's growth team adapted to these challenges.
"were several parts of that funnel that um you can't just measure online um whereas on Facebook you can track every every click every pixel all of that stuff um with Uber there are steps of that funnel..."
The Importance of Product-Market Fit
Alstromer emphasizes the foundational role of product-market fit in driving growth. He argues that having a great product is essential for success and discusses how this principle applies to both Uber and Airbnb's growth strategies.
"things and now I mentioned two so two-sided Marketplace the the real world component to it and I'll come back to the third when I remember it your different Northstar metric um well and so as as these..."
Understanding LTV in a Two-Sided Marketplace
Gustaf Alstromer discusses the complexities of calculating the lifetime value (LTV) of riders and drivers in a two-sided marketplace like Uber. He explains how market conditions can affect the value of each party and emphasizes the importance of understanding these dynamics for effective growth strategies.
"sense to pay up to what the that Rider or that driver is ultimately going to be worth um when you're in a situation where the faster you grow the better um because as you get bigger and bigger there a..."
Finding Growth Channels in a Saturated Market
Alstromer and Baker explore the challenges of finding effective marketing channels in a saturated environment. They discuss the importance of product-market fit and the need for long-term investment in various marketing strategies, including SEO and paid marketing, to achieve sustainable growth.
"in by geography and a quick comment comment on that I would say um um most companies that grow really really large they do it on figing out one platform so they are really good at online marketing the..."
The Importance of Product-Market Fit
In this segment, Alstromer emphasizes that building a great product is crucial for growth. He argues that when users love a product, they will naturally share it, making marketing efforts more effective. This highlights the foundational role of product-market fit in scaling a business.
"mean I I would I don't think there's anything shortterm that will remain like successful for a very long time so um the best advice is invest for the long term whether it's SEO whether it's paid marke..."
City-Specific Growth Strategies
Baker shares insights on how Uber set up city-specific teams to drive growth. He explains the balance between having localized strategies and a centralized playbook, emphasizing the importance of integrating product and operations to cater to unique market demands.
"surprised neither of you mentioned Instagram the tip I got yesterday at at at fate talking a bunch of Facebook folks is they think Instagram app install ads are significantly underpriced relative to F..."
Innovative Solutions for Market Challenges
Baker recounts a unique approach taken in China to onboard drivers using a WeChat bot, addressing local challenges with technology. This example illustrates the need for adaptability and innovation in different markets to overcome barriers to growth.
"business and I'm sure you guys see this as much if not more so at Airbnb is um when we would launch in a new city there would also be a lot of there would already be a lot of pint up demand we'd see a..."
The Power of Experimentation in Growth
The discussion shifts to the role of experimentation in growth strategies. Baker explains how the growth team at Uber institutionalized an experiment review process to evaluate the effectiveness of various initiatives, highlighting the importance of data-driven decision-making.
"amazing until WeChat started blocking us because they were owned by 10 cent which had invested in our competitor um so that's one example of something we had to do very differently in a different Mark..."
Cultural Sensitivity in Product Design
Baker shares a case study from Facebook where a simple copy tweak transformed Japan from the least viral to the most viral country for their product. This segment underscores the significance of cultural understanding in product design and marketing strategies.
"tricky um so I would say this happens all the time and if it doesn't happen then you're not taking big enough risks you should be seeing that things that counterintuitive sometimes when they're very c..."
Balancing Growth Metrics at Uber
Ed Baker discusses the evolution of growth metrics at Uber, explaining how the focus shifted from new user acquisition to retention as the user base expanded. He elaborates on growth accounting, detailing how to balance active users, churn, and re-engagement. This segment provides insights into the strategic adjustments necessary for sustainable growth in a scaling company.
"literally just a copy tweak to um to to make people more comfortable with sharing what the product they were using with their friends that's great I've been talking to some mobile developers that the ..."
Enhancing the New Driver Experience
Ed Baker shares experiments aimed at improving the onboarding experience for new Uber drivers. He highlights the challenges faced by new drivers and discusses strategies to ensure they receive trip requests promptly. This segment underscores the importance of creating a supportive environment for new users to encourage engagement and retention.
"like zodiac calendars exactly that kind of stuff so Ed you uh earlier you uh told a story of like the challenge of getting people to go from registering as a driver to actually like overcoming the ner..."
Integrating Growth Across Teams
Gustaf Alstromer and Ed Baker discuss the integration of growth teams within larger organizations. They explore the benefits of merging product and growth teams to enhance collaboration and data-driven decision-making. This segment emphasizes the necessity of a unified approach to growth that aligns marketing, product development, and user experience.
"different things like that frit um just a kind of Probe on something Gustaf alluded to regarding growth and organizationally um do you guys think that the right steady state outcome is for all teams t..."
Secrets of Aggressive Growth in China
Ed Baker briefly touches on Uber's aggressive growth strategies in China, hinting at unique tactics that contributed to their success. While he refrains from sharing specific details, this segment highlights the innovative approaches companies may adopt in competitive markets. It serves as a reminder of the dynamic nature of growth strategies in different cultural contexts.
"that merging think have time for one more question question question for uh Ed uh Uber was super aggressive in China and growing were there any really crazy things you guys discovered or hacks there t..."