Growth Hacks: The Story Behind GrowthHackers New Software, NorthStar & How to Get Started

Growth Hacks: The Story Behind GrowthHackers New Software, NorthStar & How to Get Started

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The Story Behind GrowthHackers New Software, NorthStar & How to Get Started

A couple of weeks ago we launched a private beta for our new growth acceleration software, NorthStar. The GrowthHackers team has been working on building NorthStar, in some fashion, over the past 3 years. It hasn’t been easy, and we’re not done.

What is NorthStar?

NorthStar is a growth acceleration software that allows your entire team to understand and contribute to sustainable growth efforts.

You might be thinking “holy buzzwords Batman” and I understand that this might not be intuitive to all, so I’d like to offer my perspective of how this software came to be and how you can start using it to achieve breakout growth at your company.

How it all started, Projects. Now…NorthStar!

While helping companies like DropBox, LogMeIn, Eventbrite and others grow from start ups to scale ups, Sean Ellis began experimenting across the full customer journey (marketing channels & in product) to identify the most efficient ways to grow the businesses he was working on at the moment.

The original Growth Pyramid by Sean Ellis

While doing this, Sean emphasized the importance of validating product market fit prior to transitioning to growth.

If the product isn’t a must-have for a sizable market, it’s more important to focus on demonstrating core value to customers before attempting to scale growth.

After an unsuccessful search to find a software that could help him facilitate the growth process he had been initiating at companies, Sean decided this was his calling and set off to figure out “how can we make more teams successful with sustainable growth?”

GrowthHackers Projects was born.

During this launch phase of the software, the main focus was on the process that fuels growth — ideating, prioritizing, testing, and analyzing new ideas for growing a business.

There was initial buzz and some early traction, but most teams fell flat on their face with the process over time for a few primary reasons…

  1. They were trying to grow before they had product market fit.
  2. They had silo’d approaches with no common goal to bring the entire team together to focus on demonstrating value to customers.
  3. They didn’t get an impactful winning test out of the gate and gave up.

While our team was learning from these problems that teams were facing, we knew there was a lot of work ahead of us with a lot of variables that could be addressed before our software would really work for teams. And not only did we need to address the problems with our own product, but we identified a big education gap that needed to be filled as well.

What does growth look like in the age of big data and strong customer buying power with an evolving mar-tech landscape?

Addressing the modern day growth education gap

Since our company was built off of the GrowthHackers Community, we have been more or less at the center of this movement and get to learn first-hand from our Ask Me Anything (AMA) hosts, as well as growth content being submitted from all over the world. Anyone can join.

Sean Ellis & Morgan Brown teamed up to study the fastest growing companies and then wrote Hacking Growth, which goes into more detail around the methodology embedded in modern fast-growing companies and how other teams can adopt it. If you haven’t read it and you want to understand how growth in today’s competitive landscape works on a deeper level, I highly recommend it.

We have an annual GrowthHackers Conference to highlight the early pioneers in growth to help people learn from their experience and build a support network. We now offer these conferences in a virtual pass so people can continue to learn from early success stories.

We launched online training programs to teach people how to facilitate the growth process and build company-wide growth culture.

Sean started doing hands-on one-day Growth Jumpstart programs with companies to help break down silos, develop an understanding of how sustainable growth works, and kickstart their growth acceleration.

We started an original content blog to share learnings from our team and other growth pioneers.

All while working with companies like Mozilla and Spotify to make our software a must-have for growth teams.

As we worked on education through the lens of “how can we make more teams successful in sustainable growth?” we looked deeply at the aspects of growth that our software could and should incorporate.

Why NorthStar?

The North Star Metric is what drives team alignment on the one essential thing that contributes to sustainable growth — customer value — and that there are multiple “variables” that go into improving that metric for any business, what we now call sub-metrics.

Without aligning the team on customer value through a common success metric, individuals operate towards their own department’s incentives without understanding how their effort contributes to the overall mission of the company. Like a ship at sea without a steering wheel.

And over time, short-sighted department incentives corrode the ability for individual contributors to innovate. Without understanding how their work impacts the long-term sustainability of the business, individuals can’t properly prioritize and execute on their own and any kind of growth process will not have the desired impact on growth.

Rec. reading to better understand aligning teams on long-term mission:
The Employee Shareholder Dilemma (Article)
Extreme Ownership (Book)

We believe this is the missing piece of the growth puzzle for so many companies. So much that we renamed the product after it. NorthStar is now the only software to track progress on your North Star Metric and tie all growth activity to improving it.

Defining and tracking a North Star Metric is the first step in getting started with NorthStar, and it’s foundational to the next steps in breakout growth.

The original & revised growth pyramid by Sean Ellis that helps teams gauge where they should be focusing their efforts in growth.

“With the launch of NorthStar, we added the glue that aligns teams and individual contributors around what drives sustainable growth — the North Star Metric.

When teams have a common success metric to guide them, their company can reach level 5 — a company-wide growth mindset and culture — using the software.”

— Sean Ellis, CEO & Founder, GrowthHackers

Users that have been following along understand the importance and are typically already tracking their metric in Amplitude, Google Sheets, or another external source. For those users, we have integrations to automatically show progress on the North Star Metric, front and center of the software.

As for others that are new to the North Star Metric concept, we still need to do the education of why it’s important, what it looks like in action, and how to choose one.

Some teams don’t currently have the ability to track their North Star Metric. Our recommendation is generally to first spend time getting your customer journey events tracked using something like Segment and Amplitude (which both have free options to get started).

Remember, if you can’t measure something, you can’t improve it.

Setting Objectives to grow your North Star Metric

Once the North Star Metric is identified and tracked, teams can set short-term objectives in the software around improving the sub-metrics that impact the overall North Star Metric.

This is where a growth model or equation helps you identify the biggest opportunity for where you should set your objective.

Often times, we hear from companies that they need more top of funnel traffic or leads. But 9 out of 10 times, there’s lower hanging fruit in the new user onboarding (activation) stage that will help demonstrate value to users quicker and grow the North Star Metric much more efficiently.

Mobile app example:
You have 10,000 new visitors to your website & 1000 download your app.
Out of the 1000 downloads, 100 create an account.
Out of the 100 accounts, 30 people return on a weekly basis.

Example Growth Equation
[New Visitors]
x [Download Rate] x [Account Created Rate] x [Return User Rate] = Weekly Active Users

Baseline: 10,000 x 0.1 x 0.1 x 0.3 = 30

Now, if you were to set an objective around new visitors to website, you will likely have to spend money to acquire these users, and your in-funnel metrics (downloads, accounts, return user) will go untouched. More money, less impact.

Top of funnel objective: 20,000 x 0.1 x 0.1 x 0.3 = 60

Or, you can set an objective to increase the account created rate. This will require internal resources to understand why users are not creating accounts and new ideas will need to be tested with the goal to increase the number of accounts created. In this case, you will be more effective at converting users and then when you do focus on acquisition, leads will be cheaper to acquire.

New account objective: 10,000 x 0.1 x 0.2 x 0.3 = 60

Whatever objectives you set for your team, they should map up to your North Star Metric, be measurable, and prove to have a high impact. If you want a more practical example of what an impactful objective looks like in practice, here’s one that I experienced.

All growth objectives should map up to your North Star Metric.

Once an objective is set, it’s time to apply the growth process with help from your team. And no, you don’t need to start with a full growth team, but you should get others to help with the ideation.

Once you set an objective in NorthStar, there’s an option to share it with others on your team. We give users the option to write more context about why the objective is important and personalize the request for new ideas. Then we provide a framework for sorting, prioritizing, and executing your teams ideas.

As ideas are submitted, someone playing the Growth Master role manages the growth process around the current objective (ensuring new ideas are added, prioritized, tested and analyzed) and help the team build a habit around continuously improving the user experience and demonstrating more value to customers. This habit is typically built through a routine growth meeting.

Are you ready to rethink your approach to growth?

Spoiler alert! It’s not easy. In fact, I often draw parallels between growth and marathon running. If you think you can run a marathon without hard work, training, the right fuel, and the right incentives, you’re mistaken. The same is true in growth. It’s a lot of hard work and some days it can be completely overwhelming.

But know that other days it’s extremely rewarding. And that there’s no better feeling than when you get an email from a customer explaining how you’ve impacted their life, or a tweet about how your product addressed someone’s needs. And for me, that’s what fuels my motivation to keep moving forward, even when things aren’t going right.

So if you’re ready to make an impact on your customers’ lives, it’s time to start growing with NorthStar.

The Story Behind GrowthHackers New Software, NorthStar & How to Get Started was originally published in Growth Hackers on Medium, where people are continuing the conversation by highlighting and responding to this story.

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