1. Sean Ellis
Lean Startup Circle
March 24, 2010
Lean Startup Marketing
Channeling Resources to Create a
Fast Growing Startup
2. Cross startup learning…
for betterment of all startups
Led by entrepreneurs
- Steve Blank
- Dave McClure
- Eric Ries
- Everyone here
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3. My Lean Experience
• Collective experience outweighs mine
• Steve Blank recommended “lean” preso
• Then couple Eric Ries posts/presentations
• Limited time to participate in lean revolution
• But 15 years of “lean-ish” principles
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4. Objectives for Today’s Meeting
1. Share insights for growing a valuable startup
2. Fresh look at my approach growing startups
using lean startup principles
3. Work together to evolve our understanding of
startup growth
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5. What are the Lean Startup Principles?
• Low burn by design (no scaling until revenue)
• Learn fast (fail fast)
• Rapid hypothesis testing about market, pricing,
customers (customers & markets unknown)
• Metrics, iteration…
• Agile development
• What else?
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6. “Lean-ish” Marketing = Back-to-Back IPOs
First Startup (1996 launch)
– Lead online game category
– Get users at cost lower than user value (ARPU)
– Minimize waste via sophisticated metrics
Second Startup (2003 launch)
– Added qualitative research and funnel optimization
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8. Low value startups:
Scaling or cost-effective marketing
Valuable startups:
Scaling cost-effective marketing
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9. Valuable Company Starts with Value
• Product/market fit = product is “must have” (value)
• Become a “must have” with customer development
– Validate “value” assumptions early (who needs/why?)
– Get users on first release ASAP
– Find “must have” users/use cases (facts outside building)
– Pivot if necessary to create value
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11. Pyramid through Lean Startup Lens
• Waste – Eliminate wasted time, money, effort…
• Focus – Channel resources to create value
• Speed - Get to next level as quickly as possible
• Learn – Hypothesize, test, refine
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13. startup-marketing.com
Key “Value” Question
“Very Disappointed” My Recommendation
0% – 25% Keep burn low, engage, iterate
26% – 39% Try repositioning, retargeting
40% – 100% Proceed up pyramid
“How would you feel if you
could no longer use Product?”
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14. Start Transition to Growth
startup-marketing.com
Scale
Get Efficient
Conversion
Product/Market Fit
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18. Scalable Growth Now Possible
startup-marketing.com
Scale
Get Efficient
Conversion
Product/Market Fit (Value)
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19. Test from Free to Paid Channels
startup-marketing.com
Channel Cost/user Scalability
Viral/referral Free High
Email (internal) Free Organic
Blog Free Organic
SEO Free or Paid Organic
Widget Free or Paid Organic
Biz Dev/Partners Free or Paid High
Domains Paid (low) Low
PR Paid (low) High
Email (external) Paid (TBD) High
SEM Paid (TBD) Can be High
Contest Paid (TBD) Organic
Affiliate/lead gen Paid (TBD) High
Radio Paid (TBD) High
TV Paid (TBD) High
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20. Driving/Managing Growth
Monitor
Conversions
• Anything broken?
• AARRR
Manage
Campaigns
•Optimize and scale
campaigns on ROI
Develop New
Campaigns
• Test new sources
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Budget to maximize positive ROI spend
21. Valuable Company
• Some loss of control is good
• Understand via triangulation
– Origin tracking
– Trend correlation
– Surveys
• Feed the beast
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22. Channel Your Resources
to Climb the Pyramid
Twitter: @seanellis
Blog: startup-marketing.com
Scale
Optimize
Economics
Positioning
Product/Market Fit (Value)