A truth about growth loops they never teach you in business school

You can create a growth loop for your product. But only on one condition

Every startup dreams about creating a growth loop. Hell, every small business owner wants the same thing (but perhaps they just don’t call then growth loops). If you don’t know why they are so desirable let me explain it to you.

Growth loops a technique used by marketers to create a loop of product-driven demand or a loop of references from customers to get more customers in. The best part of the growth loops is that, unlike traditional marketing funnel where you have to shove MORE resources IN to get better OUTPUT, it has non-linear dependencies that lad to faster growth.

Here’s a visual I created for the founders that I coach to explain the differences betweem traditional funnel and a growth loop.

Growth loops can be created by:

— the product (product-led growth) ⇒ when users want to pull more users in to get better experience with the product (think, Slack: if there’s no one in the channel, it feels like desert). Obviously, it is not something you can pull with any type of product: some allow growth loop effect, some don’t.

— by a well-planned referral campaign ⇒ users start pulling in other users as they want to get the reward (a free sample or an early access)

So far so good?
Now, let me give you the examples of growth loops in real life.

Examples

Where It Happens

Where It Happens — a podcast launched in October 2021 by Sahil Bloom and Greg Isenberg. Both are influencers on Twitter (350K and 220K followers, respectively). They could just tweet about launching this new show and get tons of listeners straight away. But that’s not what they do. Sahil and Greg both used their audiences to deliver the news about the show but they also created a growth loop. Every follower was invited to join the Waiting list. Then everyone received an email explaining that…