In the early days of a startup, Sam Altman recommends not tracking absolute user growth, instead, track product usage via two metrics: Retention and Frequency of Use. "With high confidence, I can say that you want to start with a small number of users that really love you. Almost all great companies have products that start this way. Think about the ones in your own life. The products that are so good that you spontaneously tell your friends about them. The products that are so good that if they went away, you'd write the company in protest. That's what it means to really love a product. A good indicator of that is retention and frequency of use."
There is no magic bullet in product strategy,both growth and retention/usage are crucial. The right focus depends on your product stage, business model and the industry dynamics.google+ had decent retention but applied to a niche. MySpace was the king untill Facebook came. Netscape was superior but failed in growth
Agree 💯 on user first with a small Set of early adopters (high customer love). However every startup will need to solve the critical issue when they want to move from early adopters to scale… most startups die because they can’t convert past early adopters - speaking as a 2x founder
So many companies go too early into growth hacking Jason and not spend enough time to deeply understand customer's top problems and solve them in delightful way. As his mentor Paul Graham says: "Far better to have a few people love you than have many people be meh about you"
The very definition of true fans. The only thing I would add is this assumes the product/service is more broadly applicable. Otherwise while you may get traction with these folks it may not be enough to sustain and grow the business.
Retention really matters. Even if your product gets initial hype, it won't last if users don't keep coming back.
Retention is a function of investment created through use. Frequency of use a mirror of need frequency. Increasing need frequency is a fun challenge to find the ideal match between the natural need frequency and the manufactured one in the product.
Fast growth is overrated, loyal customers are underrated
100%. Focus on improving the customer “love metrics”, and improvments in your growth metrics will follow.
Retention and frequency of use are great indicators of fans/frequent users. Those are performance indicators product managers should track for their new products. Great reminder of going back to basics, when launching products, Jason Yoong.
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1wYep. I agree. Retention and usage frequency are good indicators of product-market fit. And that's what we're all after. If you have millions of users that churn after limited use it might bump the valuation for fund raising in the short term, but you still haven't reached the 'fit'.