Lesson: Growth with Josh Elman

Step: #6 Growth Tips: Tips for managing and sustaining growth

One of the neat benefits of invitation and referral systems very early on is they do two things. One is they kind of limit your scope so the people who get on feel like they're getting there early. The fact the product may not be as rich or robust or they know they're getting early access and they give credit to their friend who brought them in. You get a much richer sense of what will people try to do and they're going to be more willing to spend time doing it.

The second part is do you actually get real virality. Does having me invite a friend make the product better for both of us? Products like communication apps, it actually can be really beneficial. We can only talk if I invite you so you might go download it but until someone invites you can't actually use it, can make that product spread, feel secretive, feel early in a meaningful way.

Other products like a media site it could be weird to have it be referral or invitation only at the beginning because you want to find some interesting content. You'll hear about it and if you go to sign up for it you can't actually user read any of the content until it's been more opened up. The answer is there's no explicit thing you should have an invite system or referral system or you shouldn't. You should think about how it can foundationally work for your product and make a big difference and let people in in the right way and figure out how to grow the network and scale it in the right way. Sometimes it's really useful, sometimes it's not.

For Dropbox you could always get Dropbox, so it didn't matter if they had a signup or locking system. They found that a lot of people wouldn't really sign up for Dropbox until they heard about it from a friend and the friend was motivated to get free gig space so they'd be more likely to be, "Please sign up for Dropbox because I need more gigs." They'd be more likely to get their friends to sign up so it turned out that was a very good mechanism for them. But that mechanism may not work for other products in the same way.

Virality is very simple process where when one person is using your product they are committed and engaged enough that they spread it to other people directly without you having to do any direct marketing or other marketing or just PR or any other awareness on your own. That's the core of virality. So if I get one person how many more people does that one person bring in.

Now, that can be everything from word of mouth. “This thing is so awesome. I sit next to you and I show you up on my phone. You then sign up for it and now you're a real user.” to, I spread it through Facebook or Twitter or whatever else. But it's all these ways in which you as company haven't had to do anything else except this user has gone and brought more people in.