9 Growth Hacks from Your Favorite Startups (and How to Use Them)

Startup = Growth. That’s how Paul Graham, founder of YCombinator, defined a startup. As per this definition, growth is the most important metric for a startup. It doesn’t matter whether this growth is in users, traffic or revenue; as long as the chart keeps pointing upwards, the startup is succeeding.

But how do startups actually unlock massive, ‘hockey stick’ growth?

The answer: growth hacking. Growth hacking is the name for a wide range of activities spread across marketing, sales, programming and design disciplines. It’s a tactic nearly all of your favorite startups have used to grow fast. And as it turns out, there’s a lot you can learn from these hacks.

Growth hacking is the name for a broad range of activities spread across marketing, sales, programming and design disciplines. It’s a tactic nearly all of your favorite startups have used to grow fast. And as it turns out, there’s a lot you can learn from these hacks.

In this post, we’ll take a look at nine growth hacks and tell you how to apply these growth hacks to your own business.

What are Growth Hacks?

SEO, social media, print advertising, PPC… Most marketing disciplines are easier to define because they are limited to specific activities. Growth hacking, however, covers a huge range of activities. A growth hacker might use anything from content marketing to coding to meet his growth targets.

Sean Ellis, who first coined the term "growth hacking", puts it perfectly:

“A growth hacker is a person whose true north is growth. Everything they do is scrutinized by its potential impact on scalable growth”

Which is to say, growth hacking defines a way of thinking, and not just a specific process or activity. A growth hacker uses any and all tools at his disposal to grow the business. He might create landing pages, drive traffic to them through social media marketing, then close deals in-person. In a way, this is similar to what CROs do. Instead of following any fixed tactics, CROs use whatever design, copywriting and analytics skills they know to create better converting pages.

To help you understand growth hacking better, here are 9 actual growth hacks used by some of the world’s top startups.

9 Growth Hacks Used By the World's Top Startups

1. Use Incentives to Get More Referrals

Sales veterans know this better than anyone else, referrals are the best source of new customers. Just take a look at these jaw-dropping stats:

  • 90% of customers trust recommendations from people they know. In contrast, only 33% of people trust banner ads (Nielsen).
  • Referred customers are 18% more likely to stay with a business and generate 16% more profits (HBR)
  • Word of mouth is the primary factor behind 20% to 50% of all purchase decisions (McKinsey).

But how does a cash-strapped startup get more referrals without heavy discounts and incentives? Dropbox growth hacked its way to an answer: it offered customers 500MB of additional space for every new referral they brought in. Considering that Dropbox offers just 2GB of free space to new users, 500MB represented 25% of the free space. At a time when Dropbox was one of the few services of its kind, this was a pretty big incentive for customers to refer their friends.

According to Drew Houston, founder of Dropbox, the company increased signups by 60% by offering these referrals.

9 Growth Hacks from Your Favorite Startups (and How to Use Them)

Even today, Dropbox uses referrals as a big part of its customer acquisition strategy. You can go to the referrals page, enter an email and earn the bonus 500MB space as soon as someone signs up. You can also invite your Gmail contacts, create a shareable link or share your referral link on Facebook.

9 Growth Hacks from Your Favorite Startups (and How to Use Them)

Dropbox also plugs in the referral link in its welcome email.

9 Growth Hacks from Your Favorite Startups (and How to Use Them)

How to Use This in Your Business

Brainstorm incentives that you can create for your business. You get bonus points for plugging in things your customers care about into this incentive. For example, Leesa not only offers customers and their friends $50 off, it even gives you the option to donate your $50 reward to any charity.

9 Growth Hacks from Your Favorite Startups (and How to Use Them)

While you’re setting up this incentive, make sure to advertise it prominently on your site. Whenever possible, create and test a separate landing page for referrals and offer customers multiple channels to share referral links.

2. Get More Customers With Email Signatures

If you received an email like this in August 2007, you’d probably take note of the signature:

9 Growth Hacks from Your Favorite Startups (and How to Use Them)

This email that proudly declares that it was “sent from an iPhone” does two things:

  • It quashes customer doubts that the iPhone could not be a serious business tool (a concern a lot of critics had around the iPhone launch).
  • It highlights how easy it is to use the iPhone to send emails - a big plus at a time when customers doubted whether the touchscreen could actually be used to type on.

This ‘hack’ by Apple is in a long line of marketing hacks that used email signatures to attract customers. The first and perhaps most famous among these is Hotmail’s “P.S. I Love You” hack. At a time when free email was basically non-existent, Hotmail added a friendly message to attract new users. This signature hack was set to say, "PS: I Love You. Get Your Free Email at Hotmail" at the end of each email.

This worked wonderfully well for three reasons:

  • The post-script - P.S. - is among the most read parts of any email, and thus, attracted reader attention.
  • The casual “I love you” tone was disarmingly charming at a time when the internet was still seen as an experimental tool.
  • The offer of ‘free email’ was irresistible at a time when email wasn’t free at most sites.

Combined, they helped Hotmail capture tens of millions of new users.

How to Use This in Your Business

Email signatures are now obviously old hat. However, you can still make better use of this vital space by creating information-rich, visual signatures.

Try these tools:

3. Create a Community

Every great business requires a dedicated community to thrive. You’ll see this with Apple ‘fanboys’ who will buy anything with Apple’s logo on it, or Nike Air Jordan lovers who’ll queue up for hours for any new sneaker release. But how do you grow a similar community? Product Hunt, a platform to discover new products, has some answers.

Ryan Hoover, the founder of Product Hunt, marketed his website by sending personal emails to all his social media followers. In fact, the first version of Product Hunt was an email list. However, Ryan didn’t just target any random follower with his outreach. He targeted influencers and social media rockstars instead. The first few people on his email list were venture capitalists and entrepreneurs. Here’s a sample of an email he sent out to early adopters:

9 Growth Hacks from Your Favorite Startups (and How to Use Them)

By asking for feedback on such an early stage MVP, Ryan created customer 'buy-in.' People who emailed him feedback were already invested in the product and were happy to share it with their followers later. After launch, Ryan continued the community building by sending handwritten notes with ProductHunt stickers to influencers:

9 Growth Hacks from Your Favorite Startups (and How to Use Them)

Other hacks Product Hunt used to build a sense of community also included holding meetups across the world. All this helped Product Hunt emerge as the go-to source for finding new cool stuff - and raising $7.1M in funding.

How to Use This in Your Business

  • Create a sub-reddit on Reddit, start a meetup, or even host a conference to attract like-minded people.
  • Give others a platform to share their own content and ideas, such as a group blog or a real event.
  • Focus on the long-term and don’t try to monetize the community in the initial phases.

4. Create a Sense of Exclusivity

Recall that one of the founding principles of persuasion, as per Robert Cialdini, is scarcity. Which is to say that anything that is not easily available to others is perceived to have a higher value. Startups often use this principle to create a sense of exclusivity. For example, when Google launched its new email app, Inbox, it limited access to a small number of users.

9 Growth Hacks from Your Favorite Startups (and How to Use Them)

Demand for invites to the app was so high that Forbes even wrote articles about it. This created a sense of exclusivity that gave Inbox a massive flux of new users once the floodgates were eventually opened. Another example is the social bookmarking site, Pinterest, which was initially invitation only. Anyone could send an email about the invitation, but most would get a response of a long wait. This helped in creating a sense of scarcity for the product.

9 Growth Hacks from Your Favorite Startups (and How to Use Them)

Limiting access in the early stages of a product has another benefit: it allows you to test your product with a small number of ‘beta’ users. At the same time, you can test out your infrastructure and see whether your app actually scales well enough for higher traffic.

How to Use This in Your Business

  • For software products, limit access to influential early adopters to create a sense of scarcity.
  • For e-commerce stores, use tactics such as flash sales or limited edition products to create exclusivity.

5. Piggyback on a Popular Platform

Using an already established platform to market your services is a time-tested hack to grow a business. A great example of this is AirBnB. AirBnB noticed early on that some of its most responsive users were coming from listings people had made on Craigslist. Manually reposting each listing on Craigslist. However, this was time consuming. It also set off Craigslist’s spam alarms. AirBnb found a way to work around this by creating a bot to automatically populate Craigslist. It then forwarded this URL to homeowners who could hit ‘publish’ and create a Craigslist listing of their properties.

9 Growth Hacks from Your Favorite Startups (and How to Use Them)

This hack didn’t last long - Craigslist soon caught on and banned the bot - but it gave AirBnB a big boost in initial traffic. It’s important to note that AirBnB targeted users in the right stage of the buying process. Thanks to its unfriendly UI/UX, Craigslist doesn’t attract a lot of ‘browsers’. Most of its users are looking to buy things immediately. This means that by targeting Craigslist, AirBnB got a lot of highly targeted users who were ready to drop their credit card details and hit ‘Buy Now.' Keep this in mind when using the piggyback hack - you want to attract buyers, not just browsers.

How to Use This in Your Business

  • Find a popular platform or marketplace (such as Amazon or eBay).
  • Sell your products on this platform initially.
  • Once you have enough traction, switch over to your own platforms.

6. Remove Friction When Signing Up

The sign-up process is a make or break point for a startup. If a user decides to skip the sign-up, the startup might miss out on that user for a long time - even permanently. Creating a seamless, friction-free sign-up process, therefore, should be the top priority for any startup. Slack recognized this. Instead of using the usual ‘name’, ‘email’ and ‘password’ form, Slack allows anyone to create an account with just an email - no password necessary. Once users have had a chance to test out Slack and add team members (i.e. show commitment to the product), Slack emails them with a reminder to create a password.

This does two things:

  • It removes a massive source of friction in the sign-up process - the password.
  • It gives users ample time to test drive Slack without ‘committing’ to it with a full-fledged account.

How to Use This in Your Business

Think long and hard about your sign-up process. Ask yourself if you really need your users’ names, emails and phone numbers? Think of ways you can cut down on the time and effort it takes to sign-up. Are there any processes (such as setting a password) that you can delay? Can you simplify the password recovery process? Once you come up with a hypothesis, create a couple of page variants and test them to see what sign-up process works best.

7. “Fake it Till You Make It

“Authority” and “social proof” are two core principles of persuasion. Something that seems to be already popular invites attention and respect. The founders of Reddit - now ranked among the top 35 websites globally - knew this fact. A “social news” website without users or content would be neither ‘social’ nor have a lot of ‘news’. To solve this problem, Reddit’s founders created thousands of fake users and used them to populate the site with content and discussions. This gave new visitors the impression that the site was already popular. Plus, by sharing content and starting discussions themselves, this allowed Reddit’s founders to dictate the kind of early users they attracted - tech savvy programmers and designers who liked to be on the cutting edge of things.

How to Use This in Your Business

This growth hack is essentially a tech version of the adage - “in order to be successful, one must give off the impression of success”. Think of ways you can create this impression of success or popularity on your website. Perhaps you can spend a few hundred dollars on Facebook ads to increase your Facebook page’s like count, or perhaps you can get a featured story on a popular online magazine to increase your perceived popularity.

8. Develop Your Own Platform

Developing your own platform is a tedious and thankless job. However, if you can make it work, you’ll have a vast first movers’ advantage over the competition. Plus, by creating a platform you control (instead of piggybacking on an existing platform), you can control the community and even dictate the terms of the market. There are plenty of businesses that have done exactly the same. Think of Amazon and its Kindle publishing platform. By creating the hardware and the distribution channel for eBooks, Amazon pretty much set the terms for the self-publishing industry.

Another example is Inbound.org. This site was built by Dharmesh Shah (co-founder of HubSpot) and Rand Fishkin (co-founder of Moz.com) to cater specifically to people interested in inbound marketing.

9 Growth Hacks from Your Favorite Startups (and How to Use Them)

When it was launched, there was no competing platform for inbound marketers. Inbound.org quickly turned into the platform to discuss all things inbound.

How to Use This in Your Business

A platform doesn’t have to be a software platform; it can also be a conference, a podcast, a blog, or even a meetup. Any place that helps people come together and share their expertise can qualify as a ‘platform’. Think about starting a local meetup for people in your industry, or creating a community using tools like Telescope. Make an effort to invite experts and lay people alike on this platform. When done right, this can translate into influence, authority, and valuable connections.

9. Integrate With Other Businesses

You’ve probably come across promos where a company packages ‘free’ samples of a less popular product with a more popular product. Say, something like this deal from Amway where you get free shampoo for every toothpaste that you buy:

9 Growth Hacks from Your Favorite Startups (and How to Use Them)

This is a simple form of ‘integration’ where a less popular product benefits from the more popular product’s reach. Tech startups do this extensively as well. For example, Groove, a help desk software provider, offers a number of integrations with far more popular apps (such as Slack, HipChat, MailChimp, etc.).

9 Growth Hacks from Your Favorite Startups (and How to Use Them)

Such integrations offer three major benefits:

  • They help you piggyback on a more popular business’ existing customers.
  • They increase the value of your business to your existing customers.
  • They make your business look more trustworthy (since it is supported by larger, more trusted brands).

How to Use This in Your Business

Integrations don’t have to be limited to tech startups. You can do equally well by plugging your products into a related, but non-competing business’ products. For example, if you’re selling soap, think of bundling a free sample of the product with a toothpaste manufacturer.

Main Points to Remember:

  • Growth Hacking is separate from traditional marketing.
  • Growth hacking is equally applicable to startups as it is to large businesses
  • The most important thing is to figure out how growth hackers think and to apply that mentality to your business.

Growth hacking describes a mentality, not a process. It cuts across verticals. Any business can use growth hacking - from startups to large multi-million dollar corporations. The most important thing is to understand how growth hackers think. The examples I shared with you above should help you key in on the mentality behind creating a growth hack. Think of ways you can apply similar processes to your business. You’ll find that many of these growth hacks can translate across industries.

9 Growth Hacks from Your Favorite Startups (and How to Use Them)Khalid Saleh is the co-founder and CEO of Invesp Consulting, a leading provider of conversion optimization software and services. In 2016, he is gearing up to launch his technology startup Figpii, a one-stop platform for everything related to conversion rate optimization.

Get Ramon's Smart Hustle Insights.

Thursday - 2 Pm EST

Every Thursday, get Ramon's Smart Hustle Insights to inspire and educate you!

Ramon Ray

Thanks for signing up!