The (Unfortunate) Evolution of the Growth Team
“Growth” marketers have sprouted across startups since 2010, but is growth just a new way of saying “marketing,” or is it a unique field of its own?
I was first asked this question by a friend who had recently joined the Israeli startup world. It seemed most people used the word growth as simply another way of saying performance marketing.
Some of those he asked about this answered that, “growth teams run Facebook and Google ads.” Others mentioned that partnerships and landing page testing were within the scope of the role of growth teams.
Now, while all these functions are essential, their limitations left me uninspired.
While performance marketing is undoubtedly a key element of the growth mix, I had thought growth (as the name suggests) was about growing the company’s revenue in any way possible. But evidence was piling up that the field was not perceived in the same way I’d imagined. In an interview a while back, a leading growth professional, when asked about the difference between growth and marketing, simply shrugged and said, “I’m not quite sure.” At least he was honest.
Is growth just another term for performance marketing, or is it a potentially key element within a company seeking to avoid stagnation?
This article is the result of speaking with growth professionals from some of the leading companies on the planet (including, but not limited to, Tech’s Big Four) and extensive reading of the thought leaders in the space.
The Birth of the Growth Team
The term ‘growth team’ began where many startup terms began. At Facebook.
Facebook had a growth team focused on finding new ways to expand their user base. This team ignored the traditional product, marketing and business development splits, and instead decided to constantly explore and test new ways to increase growth, advocating and driving these tests throughout the organization. Their strategy was clear — take a step back and look at every element that drives growth for Facebook. And then find a way to pull the most impactful levers.
Sometimes, this meant making Facebook faster on mobile phones, which proved key for driving adoption in the third world. It meant making it easier for users to invite friends by importing contacts. Facebook’s growth team was not there to simply drive traffic and hope it would convert. Rather, it was handed the company’s key metric, DAU (daily active user) growth, as well as the challenge of increasing that number, however possible.
As a Facebook growth team member told me, “we continuously evaluate all potential opportunities to increase our metric and choose a mix of the biggest/riskiest and the safest/smallest to increase DAU. Then we test it (using the Quick Experimentation platform, a tool Facebook built to enable anyone on the team to easily test a new feature’s impact).” They take all ideas for driving improved growth, rank them quarterly by projected impact and effort, and then test them. This means, quite importantly, that they don’t just work on incremental optimizations but also on enabling growth via innovation. This mix of small and big wins is essential for achieving longterm growth success.
This model was eventually adopted by companies such as Uber, LinkedIn, Dropbox, Slack, Airbnb, Atlassian and even Tesla, some of the leading companies associated with 21st century startup success. It was then popularized by leaders such as Sean Ellis (founder of Growth Hackers and early growth employee at Dropbox and Eventbrite) and Andrew Chen (formerly leading rider growth @ Uber, now a partner @ Andressen Horowitz).
Ever since, the growth team has become a common feature at startups, with many boards requesting that their founders hire a growth team.
Why? As Andrew Chen points out in his iconic piece on the growth team, growth won’t necessarily continue unless there’s a properly equipped team to cultivate that growth. In other words, just because you build, it doesn’t mean they will come. A multitude of amazing product features may answer every customer’s needs, but they don’t guarantee that new users will come.
Now, this doesn’t minimize the role of other teams in growing a company. You can’t grow a bad product just as the famed NFL coach Bill Parcells couldn’t turn “chicken shit into chicken salad.” Or as Alex Schultz, VP Growth at Facebook says, “product-market fit is the only thing that matters for growth.”
Product continues to play a key role (probably the most important) in driving growth, as do Customer Experience, Marketing, Sales, Comms, Content, Brand, etc. Still, it has been proven beneficial to have one team that works cross-functionally to drive changes and that focuses only on that key metric for growth (or two-three key metrics in some cases).
Back to the Point — What is Growth Supposed to Mean?
The essence of growth is actually pretty simple. As Merriam Webster suggests, it’s about increasing the number of something.
In the case of businesses, that thing is usually the key company metric, whether it’s ARR, users, new users, engagement, or some combination of the bunch. It also usually requires a mix of skill sets, or a team, to accomplish the goal of constantly driving growth of this metric. Meaning that if you want to grow successfully, it’s not enough just to have a bunch of people running Facebook and Google ads. As Facebook, Uber and the other successful companies mentioned above prove, growth sometimes requires paid user acquisition, and it sometimes requires partnerships, but it also requires product work.
What growth always requires, however, is clear — the ideation, testing and implementation of initiatives that can increase a company’s key metric, whatever that may be.
Growth employees at leading tech companies make this proposition extremely clear:
- “Growth = lift a metric. Any metric but usually the key company metric. The key is driving 1000x improvements, not 1.5x.” Growth @ Yelp
- “At Amazon, the focus is mostly on finding ways to drive revenue growth, however possible.” Growth @ Amazon
- “Oftentimes, growth teams focus on optimization…other growth teams start a bit more big picture to understand what actually drives growth for the business. Most companies think they need the former but actually need the latter.” Growth @ Uber
- “Many use it as a misnomer for performance marketing. But generally, it’s about focusing on your most important metrics and running tests to optimize them.” Growth @ Vimeo
Now, there is no one model for doing this. How it is managed can vary across companies. And this is fine and is actually the point! You don’t necessarily need a growth team that includes engineers or product managers. You don’t necessarily need growth partnerships or paid acquisition teams to sit in with the growth team. Many teams that have implemented the growth team methodology have grown their key metrics successfully in various ways. As Andrew Chen’s chart covers fairly clearly, the model can vary widely:
At the left extreme, a growth team can own nothing and move from project to project, driving initiatives within areas they don’t own. They can work with the product team on a referral program one day, the business development team on key partnerships the next day, and the marketing team on a key awareness piece the following one.
On the right extreme, the growth team can own each area of growth, having an embedded growth product team, growth partnerships team, and growth marketing team. All of these sit within the larger growth team.
While structure can vary, as long as the team is in place, can make contact with all these areas and is given reign to work on a wider array of tasks, it can be as successful as the growth teams at Facebook and Uber. Each model has its pros and cons, leading most growth teams to adopt a hybrid model.
Regardless of its structure, at its heart, a successful growth team’s purpose is clear — to drive growth of the key company metric(s). For a B2B company, this may entail driving lead acquisition initiatives, Sales Ops changes or product improvements that are key for onboarding successfully. For a marketplace, this may require a more complex mix of driving growth of each aspect of the marketplace and engagement. For a B2C company, this may involve testing a new acquisition channel or partnership, but it may also include optimizing the sales funnel or using AI to improve product recommendations.
Some growth tests are simple, such as testing a new landing page or CTA, changing ad or email copy, or determining when is the best time to send a notification. Other growth challenges may be complex, such as driving the launch of a new product or feature to increase stickiness, optimizing a product to fit a new segment, or building out a tool to better measure marketing effectiveness.
But however you look at it, a growth team’s purpose should be to drive growth of a company’s key metric(s) in any way possible. This can usually be achieved by prioritizing and driving a long list of tests across functions, and then using data to measure their success.
The Unfortunate Evolution of the Term — Setting the Record Straight
Unfortunately, when anything expands, the game of telephone comes into play and misinterpretations emerge. As a result, some wind up defining the growth field as “running Facebook and Google ads,” because that’s how their company incorrectly adopted the team.
So let’s set some things straight. If you want to do it well — or at least how the best companies who’ve utilized the model have done it:
Growth is not Product. Product’s job is generally to increase core value for users. Sometimes this can include pulling growth levers, but that will rarely be the focus of a typical product manager. Too much growth focus from a product team and the core value may stagnate. As Andy Johns of Unusual Ventures puts it, “growth is the side dish, not the main course,” going on to say that “we’ve lost our damn minds if we think growth hacking is more important or compelling to research than product market fit.”
Growth is not Marketing. There is a ton of overlap between the two, but enough of a distinction to warrant both teams. While growing a company’s key metric could include actions like brand marketing and PR/comms, these will usually be too far beyond the skillset of a typical growth pro to get executed well. And they will usually be far too hard to measure in a way that justifies growth’s continued involvement. If you don’t have a marketing team sitting outside of your growth team, you may wind up focusing way too much on short-term metrics instead of investing properly in long-term brand building.
Growth is not User Acquisition. While growth teams often house User Acquisition teams to run Facebook ads, Google ads, new User Acquisition channels, and growth partnerships, growth does not simply equal User Acquisition unless New Users is the only key company metric (which it shouldn’t be unless you’re okay with lots of traffic but no recurring sales or user engagement). This means a successful growth team must be able to collaborate with or own product, marketing, and other cross-functional initiatives that drive growth of that key metric.
Why is This Misunderstood?
Sometimes a founder just doesn’t want things to be run that way. Sometimes talent limitations mean that you can’t build such a growth team. Sometimes people who come from media buying backgrounds are hired as growth pros and eventually rise up the ladder, but don’t recognize that they’ve entered a new field (this happens a lot in Israel). Sometimes people have titles that just don’t fit what they actually do. Sometimes terms like growth hacking, coined by Sean Ellis, drive misleading images of one person magically driving growth hacks, just as a computer hacker magically breaches security defenses.
And so the telephone game continues. While Sean Ellis meant that “a growth hacker is a person whose true north is growth,” people began and continue interpreting growth differently. You should at least be conscious of the opportunity cost when limiting your growth team’s impact to optimizations.
Sometimes, optimization is indeed the key element for growth to focus on. In the early stages, a startup’s growth team is often focused on performance marketing. This is normal. But as the company grows, the growth team’s roles should evolve to ensure that it always focuses on the key growth levers. This evolution is iterative and never truly ends.
Want to do it the right way? It’s quite simple. A growth team is there to drive and test initiatives that should increase the company’s key metric(s). In other words, to help ensure that the company continues to grow. So look at all of the company growth levers, test a healthy mix of optimizations and innovations, prioritize and continue experimenting.