Getting to 100,000 users | Paypal’s $60M referral program that nobody knows about
Accordinng to Elon Musk, founder and former CEO of Paypal, the company acquired 100,000 users in the first month. Here he is explaining how they did it:
If you signed up for Paypal, they’d give you $20, and if you referred a friend to Paypal, they’d give you another $20. Referrals = 100,000 users in one month. Remarkable.
It is interesting to note that Musk says they spent $60 or $70 million dollars on this program, which is a budget you don’t find in most growth hacking stories (e.g. Dropbox, Hotmail, etc.), but the commonality in tactics for each of those stories is staggering.
Even today Paypal is relying on a referral program to grow into China, offering some amount of money for each person a user gets to sign up to Paypal.com.cn, their Chinese website.
It seems that refer-a-friend programs are becoming (or have become) the new standard for growth marketing.
Originally published at prefundia.com.