How to make my start-up grow in Nigeria?

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How to make my start-up grow in Nigeria? Is this your question? Then, learn from the successful Eventbrite how to scale your business in a healthy way. A few years ago, the online ticket sales platform Eventbrite realized that it needed to take its growth seriously. Just last year, the business sold 2 million events in 180 countries. This refers to – How to make my start-up grow in Nigeria?

Growing Up:

Table of Contents

However, growing up is not that simple. As the numbers and expectations have increased over the years, the importance of understanding more deeply their main business levers and better understanding their customers’ needs also increases. Brian Rothenberg, now vice president of growth and marketing for customer acquisition, joined the team to help with precisely scalable and replicable growth processes and channels.

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Growth as a Function:

As soon as he arrived at Eventbrite, Rothenberg realized that, although everyone was working hard with the ultimate goal of expanding the business, nobody in the company had the role of focusing only on growth, as data-based growth was defined and adopted in Silicon Valley and experimentation. They were also just beginning to learn how to acquire users consistently. Rothenberg saw a great opportunity there.

Multifunctional Combat Team:

One of the first things he did was to help find a combat team that, although small, was multifunctional and obsessed with growth. Together, they have had many wins, losses and learnings over the years, as Eventbrite has grown to become the largest online ticket sales platform in the world.

In addition to being a major contributor to the growth of Eventbrite, Rothenberg also helped to multiply the size of TaskRabbit, a startup of which he was co-director of marketing, by three. Before that, he had built his own business, SkillSlate and started his career as a product manager with a focus on growth. In this article, we put forward his answers to those tough questions about growing a company and gives advice on how to reach more users, capture more value and ensure that the best customers return.

Live Questions & Answers: How to make my start-up grow in Nigeria?

My start-up is at an early stage. How should we think about its growth?

“There is a saying that the company’s life has only two phases, one before and after it hits the best product for the market it wants to reach. If you’re in the pre-product, honestly, don’t worry about growth. A big mistake that people make all the time is trying to find a magic and definitive growth solution that proves they were right – it doesn’t exist. Or if it exists, it’s a one-off tactic that won’t work for long and will only cause more problems in the long run, “said Rothenberg.

The resources that the company has should not be used for growth if it is still unclear whether the product sold is what will bring sustainable user engagement and create value. At this stage, all you need to do is focus on finding the product that will fit with the market you want to target (in the jargon in English, product-market fit). Ensure that there is a real demand for your solution, talk to your potential initial customers and impose fast and agile interaction.

Growth Expert;

“Growth expert Sean Ellis, CEO of GrowthHackers says you should test your product by researching your user base before working on growing the business. If at least 40% of your users do not tell you that they will be very disappointed if your service or product disappears overnight, you probably do not have a product suitable for the market. Reaching this milestone is a sign that you have found your niche and then it’s time to put fuel (in the form of money or resources, like people) into growth tactics, to leverage the business and get more user and money returns ” , complete.

How to make my start-up grow in Nigeria?

It is important to note that the trigger metric for this change to begin is engagement. That is, a healthy combination of traffic, activity and user retention. Startups are likely to consider only the first two as a green light to invest in growth. And forget that they may have a leaky bucket in their hands (not retaining the customers they win). That’s why he recommends that early-stage marketing and growth teams focus most of their efforts on acquiring customers. But regularly check the rest of the funnel. At a basic level, this looks like:

Traffic → Registration → Key conversion event → Engagement → Retention → Evangelism

You can see why these responsibilities belong to marketing. Rothenberg points out that without product experience, it is difficult to significantly impact retention in a way that really moves your business until you have a large enough customer base.

Organic customer acquisition

In the beginning, most of your energy should be used for knowledge of your product / service and organic customer acquisition (press, brand building, SEO, public relations, e-mail) and testing paid acquisition channels. Retention is a little more difficult to assess, but it is important to have some sense of churn (exit from users) so as not to commit to a defective strategy. This becomes critical as the business escalates and revenue from former customers increases. If all signs are positive, then it’s time to step up.

What can shock you is how fast you need to switch to growth mode after that happens. Not only do you need to focus again on acquisition and conversion, you also need to quickly escalate the team responsible for it. Knowing that, with the right product, it will happen very quickly, is half the battle. That way, you can have a basic plan ready, ready to be implemented – a kind of emergency button, for when you find your product-market fit.

This raises another question: What if you only have two or three people to work on this initially?

“You have to be relentless about prioritizing,” says Rothenberg. “Everyone needs to be working on a few things that will actually impact the result. The essence of the strategy is to decide what to say “no” to, and whoever is managing the team should help identify that and protect your team from anything that is not within your critical initiatives. Sometimes that person will be the marketing director. But sometimes the founder himself. Here are some lessons learned by Rothenberg on how to work with teams smarter:

Ask yourself: ‘What is the unfair advantage of our business?’ Identify and build on your unique strengths instead of trying to do everything. “Doing what your competition is doing, better or worse, is unlikely to lead you to dominate the market. You have to find a way to do things differently. ”

Testing List

Build a backlog (list) of everything you think is worth testing and what key metrics you expect this to move. Then, rate each one based on

1) expected effort,

2) expected impact,

3) probability of success and

4) dependencies.

Here are some examples (using hypothetical data):

Experiment 1: A / B test to improve the conversion rate for subscriptions to actual conversion events.

Metric: Sign up (purchase rate).

Expected effort: low.

Expected impact: high.

Dependencies: none.

Experiment 2: Effectiveness lookalike ads (ads aimed at new customer bases that look like your current audience).

Metric: volume of new users and ROI (return on investment) of subscriptions.

Expected effort: low

Expected impact: medium

Dependencies: none.

Experiment 3: Redirect ads designed to get people who visit your site to sign up.

Metric: volume of new users and ROI (return on investment) of subscriptions.

Expected effort: medium.

Expected impact: medium.

Dependencies: Design for ad creatives.

Experiment 4: A / B test that adds social proof language (social language – based on the idea that people make buying decisions influenced by what people around them are doing or will think) to the home pages of some key sites to increase the inscriptions.

Expected effort: high.

Expected impact: low.

Dependencies: Engineering to implement, analysis to track

Identify patterns in your actions – from these examples, the natural (and ideal) choice should be to prioritize actions that have low to medium effort, that have medium to high impact potential and no or few dependencies. (Not relying on engineering or other scarce resources within the organization to help you build experiments is a good advantage.)

How to make my start-up grow in Nigeria?

Prioritize these activities, but don’t forget to start now also high impact initiatives, but that require joint work with other teams. They take time to develop and it is cool to start playing them in parallel with other activities with few dependencies.

Document your list of priorities and tests and present it to your nearest boss or advisor weekly. Be willing to change things, if necessary or demanded.

Always have a deadline in mind – be realistic when setting deadlines, share them with the entire team and avoid extending them too much.

Working quickly on the things that matter most and that are largely under your control to get done can take you a long way. But soon you will need to think about expanding your growth strategy. Another thing you can do is choose some people from your organization who were important to carry out your current plan and ask them to share good practices with other team members. Empower these people to raise the bar in the most efficient way of working, helping to spread the growth mind-set across the organization.

Okay, I’m ready to put together a team, now what?

First, the best growth teams are built in companies in which leaders are 100% aligned and give them a certain amount of independence and independence to operate. On Twitter, Dick Costolo was known for giving permission to the growth team to ‘rock the boat’. At Eventbrite, Kevin Hartz was promptly open and supported the creation of a multidisciplinary growth task force. The best structure depends a lot on the type of business and what works best in practice within each organization. But one thing is certain: it will depend largely on the people you have, since talented people for the growth team are difficult to hire (both in the USA and in Brazil).

Second, it doesn’t have to be a great team.

At Eventbrite, growth efforts are spread throughout the organization, with a deep multidisciplinary work between product, marketing, engineering, analysis and other teams. Rothenberg’s attack team, for example, started with a marketing person (he), a product manager, some engineers, as well as shared resources for data analysis, UX (user experience) and design. This group dedicated itself exclusively to the growth in the number of users during a trial period. That was how the team received the approval of the executive leadership. This led to faster learning and soon became a constant practice. The key, they found, was to focus not only on helping the company’s overall growth, but on a specific growth target.

Focus on one aspect of growth and know exactly which metrics to follow. In the case of Rothenberg, the team focused primarily on growing Eventbrite’s business offering. An important initial mission was to test how to convert more event attendees into event planners, who would use the platform to issue tickets. This happened after the team identified this as one of their “unique advantages”.

How to make my start-up grow in Nigeria?

Early on, Eventbrite gained strength through the energy of the event organizers, who invited participants to their events. After the guests bought the tickets, they learned that they could use the platform to help organize their own events. This resolved a pain that early customers pointed out from having to use inefficient methods like pen and paper, spreadsheets, collecting money and checks, etc. to charge entry for events. As new event organizers invited more participants to their events, the number of users grew exponentially.

With a core service that solved a genuine problem for organizers, regardless of their size or type of event, the growth team realized that they could optimize this functionality and make it a good lever to acquire more customers at zero cost. Through a series of tests and optimizations, these efforts drastically increased conversions, which helped to consolidate the need for a multidisciplinary team for permanent growth.

Previous Experience

Much of what has been tried, Rothenberg has drawn from previous experience. At TaskRabbit in 2012, Rothenberg oversaw the areas of customer acquisition and retention – but, again, there was no formal growth team. Instead, he worked closely with the product and engineering teams to run some experiments on time. In one, for example, the user acquisition marketing team teamed up with engineers to create a personalized page that updated their content in real time based on the keyword used in the searches (a search marketing strategy or SEM – search engine marketing, as it is known). The idea was that this could improve the conversion. For example, if someone were to search for “house cleaner”, they would probably load a page with useful content for potential house cleaners.

How to make my start-up grow in Nigeria?

“We tested this by starting with a landing page, which we divided into four more customized versions, each focused on the most popular TaskRabbit service categories,” says Rothenberg. As you might expect, custom versions of the landing page converted better.

Seeing these results, they then further divided the versions, this time into subcategories. The conversion improved even more. Then, they were further investigating. By investing even more in engineering work, they created even smarter pages that would detect ideas with nuances like “spring cleaning in New York.” The content would also automatically update to make the experience more relevant for each visitor.

“This helped us to improve conversion through relevant searches within other relevant searches, which boosted our acquisition of new customers,” says Rothenberg. Working together, marketing and engineering have produced better business results than independently.

Growth is best driven by the alignment and coordination between marketing, product, engineering and analysis.

This was a decisive learning experience he had in the early days of his own startup, SkillSlate. In an effort to build the first local marketplace for independent service providers (such as babysitters, janitors, plumbers), they knew that there was a high volume of one to two person companies that basically conducted their business through word of mouth. Most of them didn’t even have a website. But to be successful, SkillSlate needed to build a reliable market that balanced supply (these service professionals) and demand.

The team decided to focus on the offer first, and they knew they needed to take a new approach to stand a chance. Interestingly, the founders had the qualities of a growth team, with knowledge in products, engineering, analysis and marketing. They just needed to figure out how to move together.

How to make my start-up grow in Nigeria?

His first idea was to solve a critical need for service providers: to be found in Internet searches. But that would be expensive and they needed to increase the offer of services at no cost (after all, they still did not have paying customers and attracting them would take time).

What they did was to create a web crawler, which found and aggregated thousands of classified ads already existing in a single database. Then, they identified and took what information would be most relevant, such as phone number and email address. All ads with the same data were grouped and labeled as belonging to the same business. All of this allowed SkillSlate to use a single language (and types of information) to describe what people did and make their contacts available. With the help of Mechanical Turk, they were able to turn these unstructured ads into a much more compelling list of companies and service providers, with additional information such as neighborhoods served, hours of operation, and more.

First Attempt:

By publishing these lists on the Internet, they basically created the first website (or online presence) for the service providers they wanted to recruit for their platform. More importantly, it made their information better positioned on Google’s search engine and generated better business.

“After all of this, we were able to contact service providers to ‘claim’ their business information to edit it in order to supplement with customer testimonials,” says Rothenberg. “Many of them found their own businesses on Google on the lists before we got to them. This led us to acquire thousands of suppliers almost immediately after launch ”.

How to make my start-up grow in Nigeria?

Although this multidisciplinary approach – which could even be said, not so masterful – contributed to boost initial growth, it came at a cost. The system took longer to build than expected, and the team overestimated growth and scale, at the expense of devoting limited resources to resolving customer issues. “We had a really smart way to attract people to our supply side, but we didn’t use our experience intelligently to come up with the best product,” says Rothenberg. “To be honest, we missed the point. I remember meeting with one of our investors who suggested that our scale efforts were an attempt to divert attention from our lack of product engagement. Thinking today, he was 100% right. ”

SkillSlate was able to close a very agile acquisition agreement when it was sold to TaskRabbit, but it continues to wonder how the business would have thrived if they had answered the question of adjusting the product before facing the challenge of scaling.

Looking back, there are a few things that Rothenberg learned from all of his experiences:

Don’t try to climb too early. “When I was working on my own startup, we tried to scale up before I had made the necessary adjustment to reach the product that would meet the pains of our market. We try to force our growth instead of focusing on user value and engagement; it was a huge mistake ”.
Do not manage growth independently through a single traditional group, such as marketing or product alone. You need people with different types of skills and energy working together and dedicated to the cause.
Always align your organization with some key metrics that everyone can share and pursue. Each person’s individual goals should directly target at least one of these metrics.
Realize that every business is different. There is no single formula. Adapt these tactics to your market, but always prefer simplicity. It is very easy to overcomplicate growth efforts. Start with objective goals. Explain the experiments clearly so that everyone can understand them. When you get to the results, make sure they make sense for everyone and take logical and specific actions.

Nice. Things are happening. But, how do I know if we are making progress?

Reporting Growth:

Reporting growing results can be tricky, because not everyone is concerned with the same things, even if you share the same metrics. It also makes a huge difference whether you are a B2B company (customers are companies) or B2C (customers are end consumers).

For example, if you are focused on the B2B segment, “the big point is to provide real-time data on the stages of your lead (potential customer’s) life cycle and to be able to track it efficiently. At a minimum, you should report on volume and conversion rates between each step of your funnel, ”says Rothenberg.

Highlight and circle how close you are to reaching your monthly, quarterly and annual goals and conversion rates. “These metrics are important because they provide you with insights into your strengths and weaknesses, so you can develop your marketing plans,” he says. “You can also track these conversions based on campaigns to identify which types of campaigns are best for generating and / or converting different types of leads.” Some terminologies are useful here:

How to make my start-up grow in Nigeria?

Leads: potential customers who express an initial interest in purchasing your service or product or at least filling out a form with their personal details to demonstrate future interest.

Qualified Marketing Leads (MQLs): potential customers who express a much deeper interest – metaphorically, they “raise their hands” to be contacted. This is usually based on the amount and types of content they have consumed, or actions they have taken, such as watching a product demo and / or looking at the pricing page.

Qualified Sales Leads (SQLs): Perspectives that have been reached, researched and examined by your sales team.

Opportunities: Potential customers who are in active contact with your sales team, one step away from becoming customers.

NOTE: The ideal is to convert your MQLs and SQLs into opportunities.

How to make my start-up grow in Nigeria?

All four points must be monitored in any B2B growth plan. Let’s say you are 75% off your MQL target, 10% on your SQL target and 50% on your opportunity goal. When looking at these numbers, you will probably need to spend your time increasing your conversion from MQL to SQL or find out where your most valuable opportunities come from. You can then consult your campaign reports to decide what type of program to run that will help you get there.

When it comes to B2C business, however, what works tends to vary more. To illustrate some tactics, Rothenberg cites an example of a marketplace.

Marketplaces tend to have a “north” metric called ‘Gross Merchandise Value’ (GMV) – the value of all goods and services traded on the platform.

How to make my start-up grow in Nigeria?

This metric has several entries and funnels:

Supply side: Traffic → Number of registered sellers → Number of products listed → Number of products sold * Average sales price = GMV

Demand side: Traffic → Number of buyers → Number of items purchased * Average sales price = GMV

To arrive at transactional revenue (the biggest source of revenue for a marketplace), you normally multiply your GMV by your take rate.

So, for a marketplace, the things you should care about most are: how much supply and demand you have (within geographic areas like cities, or within categories like books, electronics, etc.). This leads you to care more about the quantity of items sold and how quickly and efficiently you are combining supply and demand.

How to make my start-up grow in Nigeria?

Once you have a basic equation for the supply and demand sides of the marketplace, you must map your metrics to each one. It will probably identify more or less healthy areas than others.

Looking from above it may seem that you have enough supply, but you need to generate demand. But when you look deeply, you realize that, in reality, it may be that you have twice the amount needed in one category, but half of what you need in another. Identifying and balancing these situations will help you gain liquidity. Going even deeper, you can see that you have traffic and subscriptions at healthy levels, but your conversion to listed products is low. This can help you identify where to invest the most time, money and effort to drive everything else.

The progress you are making in your plan needs to be monitored constantly.

How to know the basic elements of e-commerce business plan — WHY NOT PRESS THE BOTTUN?

“Campaign reports are better if they are updated weekly and distributed to the internal marketing team,” says Rothenberg, who recommends adding Gauge charts to your CRM for immediate insights. “This will allow you to make mini-pivots (changes of direction) in your strategy, based on data.”

Monthly, compile the progress you have made in relation to your plan, main learnings and main challenges and share this report with the sales team. Briefly, define which campaigns you plan to run in the next month based on these lessons. Eliminate those that did not work. This will maintain good communication and make you responsible for constantly improving.

How to make my start-up grow in Nigeria?

It is easy to detail these reports too much, which wastes everyone’s time. For example, email opening and click-through rates can be useful information for the right people on the marketing team to optimize what they’re doing, but they aren’t useful for broader funnel analysis, says Rothenberg. They do not need to be passed on to other teams.

“Everyone who needs to know real-time data must have access to the right dashboards in their CRM,” he says. “But we don’t send many reports to people via email. We insist on speaking at the main weekly, monthly and quarterly meetings in order to make the necessary comments and unfold complex topics in real time. We don’t just want to show numbers of people, we want to describe what the numbers are telling us and discuss what we are doing about it. ”

How to make my start-up grow in Nigeria?

Keep in mind that setting the wrong goals can be worse than not setting goals. Of course, this goes against the analytical growth approach, but wrong goals can actually do some harm. People’s nature is to drive towards targets. But if those targets are not aligned with what really drives a desired outcome, everything can fail.

In the beginning, before you know precisely what drives your business, it is very useful to be flexible in your goals and to regularly adjust and make a new forecast regularly along the way. “This is an ongoing process for us at Eventbrite,” says Rothenberg. “We are always watching our business drivers and how we can work smarter on what will really leverage results for our customers first and then for our business.”

What tools do you use to do your funnel analysis? And how do you act from the results?

“When working with companies at an early stage, I usually use a combination of third-party tools, such as Google Analytics for traffic analysis, Mixpanel for visualizing funnels and Optimizely for A / B testing,” says Rothenberg. “These tools tend to work well when the business is ramping up. Although during the scale stage most companies begin to rely more on tools built in-house, such as a proprietary A / B test platform, which is viable as the company scale and needs change ”.

You should also spend some time calculating your business ‘unit economics’. That is, the costs and revenues associated directly with a specific business model at a unit level. For example, what is the value of each user? Has it increased or decreased over time? How much should you spend to scale the number of users? It is vital that you understand the relationship between customer acquisition costs (CAC) and customer lifetime value (CLV or lifetime value – LTV). This is how you will ensure that user acquisition is profitable.

“In the initial stage of a startup, you are just trying to acquire enough users to come up with a product suitable for the market and see if the unit economics is working,” says Rothenberg. “You must track simpler indicators, such as direct spending and promotions.” The goal is, at low costs, to find out which channels will bring the most and qualified users.

How to make my start-up grow in Nigeria?

In the escalation phase, LTV should include almost everything: number of employees, expenses with direct marketing, expenses with branding, discounts and promotions, among others. Take into account the company’s general expenses – your rent, support functions, cost to meet recurring revenues, etc.- in order to obtain your true LTV in terms of gross margin. The simple equation is:

LTV = (Revenue per user * gross margin, in%) / customer loss rate (Customer Churn Rate)

You’ll really want to dig deeper here to make sure that what you’re doing will pay off in the long run. “A common mistake that I see startups making is that they calculate LTV once and think it is definitive,” says Rothenberg. “As the company starts to acquire users beyond those initial ones, almost all companies end up acquiring users of lesser value. This degrades LTV and can lead to an upside-down situation where LTV is lower than CAC (that is, the price paid for the acquisition does not pay) ”.

Update your LTV estimates regularly, either quarterly or semi-annually, to ensure that you don’t spend more than you earn with each purchased user. “It seems obvious, but many companies are victims of it, and scaling negative unit economics is a quick way in the wrong direction,” he says.

Keep peeling the onion to understand the factors and metrics unique to your business. Follow them obsessively.

“Conversion is a lever that needs to be pushed every day,” he says. “Throughout my career, I’ve performed hundreds of A / B tests on key landing pages and user flows, to interact and continually understand what improves conversion from sign-up to the end of the funnel. As you scale, your higher leverage tends to be more at the end of the funnel. I have repeatedly seen how some of the biggest and most overlooked opportunities are in the deepest parts of the funnel. ”

For example, in TaskRabbit, Rothenberg’s team ran several tests across the funnel and found that the biggest impact came from improving connections between people who posted tasks that needed to be done and who was willing to perform them (TaskRabbit is an app that connects people who are close and can chat to combine small services). From this hypothesis, they made changes to the product to increase the number of successful connections and the results were not surprising. This eventually led to a change in the company’s strategy, which no longer focused on offering customers on-demand services, which quadrupled the company’s revenues.

How to make my start-up grow in Nigeria?