20 Growth: Why Retention Defines Product Market Fit, What is Good Retention Levels Today, The Most Counterintuitive Elements of Product and Growth & Why So Many Startups Mess Up Hiring For Growth Teams with Brian Hale, Head of Consumer Product & Growth @

Brian Hale is Vice President of Consumer Product & Growth @ Doordash. Before joining Doordash, Brian spent an incredible 10 years at Facebook, most recently as VP of Product Growth working across Instagram, Messenger, Whatsapp and more. Prior to Facebook, Brian was Director of Growth @ Uptake.com and it all started for Brian in 1999 working at ACDSee in Canada where he was asked to “figure out that search engine thing”. In Today’s Episode with Brian Hale You Will Learn: 1.) Brian Hale: Entry into Growth: How Brian made his way into the world of growth from being a "marine ceramic engineer"? What were 1-2 of his biggest takeaways from his 10-year journey with Facebook? What are 1-2 of the biggest misconceptions about the Facebook growth team? 2.) When is the Right Time: When is the right time for startups to hire their first growth leads or reps? How should the founder allocate resources to the growth team? Hire new designers, engineers etc for the team or pluck them from existing teams within the company? What are the biggest mistakes startups make on the timing of this hire? How can startups accurately assess whether they have product-market-fit? What levels of retention suggest PMF? How does this change by industry? 3.) Who To Hire: Step by step, how does Brian structure the interview process for all new growth hires? What are the must-ask questions for growth leaders to ask candidates in interviews? What are the clear signs and answers that suggest a 10x growth hire? How do the very best interact with data? What do they really hone in on? What literal tests does Brian do to determine the quality of a hire? How do the best perform? 4.) Onboarding and Integration: What is the optimal onboarding process for all new growth hires? What can leaders do to set their new growth teams up for success? What are the biggest ways new growth hires can mess up in the first 60 days? What have been some of the biggest challenges for Brian in his onboarding at Doordash?

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Harry Stebbings?

  This is 20 Growth, one of my favorite shows that we do here at 20VC. And this, my friends, is the show where we interview the best growth leaders in the world, revealing their tips, tactics and strategies when it comes to scaling the best growth teams. Today, I'm so excited to be joined by an OG of the world of growth, Brian Hale. Brian is Vice President of Consumer Product and Growth at DoorDash. Before joining DoorDash, Brian spent an incredible 10 years at Facebook, most recently as VP of Product Growth, working across Instagram, Messenger, WhatsApp and more. And prior to Facebook, Brian was Director of Growth at uptake.com. And it all started for Brian in 1999, working at ACDC in Canada, where he was asked to figure out what "search engine thing" really meant. I do have to say, this was such a fun one to do. Huge thanks to Casey Winters at Avan Bright for the intro,

• 0:45Harry Stebbings?

  and to Luke Levesque at Shopify for the questions. Really do so appreciate that. But before we move into the episode today, if you're a founder or running a startup, I want to tell you about Brex. Brex combines high-limit credit cards, expense software and payments into one platform to help you scale smarter and faster. Go to brex.com/growthpodcast to get a corporate card with 10 to 20 times higher limits, great rewards and expense tracking, plus a business account with no transaction fees, and there's no personal guarantee or credit check. Apply 100% online at brex.com/growthpodcast today, and you'll get up to 50,000 rewards points. And speaking of equipping your team with Brex there, let's face it, talent acquisition has never, ever been harder, and that's where lemon.io comes in.

• 1:29Harry Stebbings?

  Why squander time and money on developers that are not perfect for your company? Lemon will match you with engineers that can take your vision and make it a reality. They have this incredible 24-hour matching process, that's also custom matching process, meaning really, really high quality and zero risk replacement. I know, pretty awesome. So head over to lemon.io now to massively up-level your engineering recruitment. And finally, I've always been a big history man, and so I want to talk about Cooley, the global law firm built around startups and venture capital. The firm has been devoted to entrepreneurs and ambassadors, partnering with both to transform breakthrough ideas into successful companies. Cooley works with more than 7,000 innovative, high-growth private companies. Clients to ensure that they are structured for growth and long term success.

• 2:13Harry Stebbings?

  So to learn more about the number one most active law firm representing VC backed companies going public, head over to coolie.com and also cooliego.com. Coolie's award winning free legal resource for entrepreneurs. But that is enough from me. So now I'm so excited to hand over to the one and only Brian Hale at DoorDash.

• 2:36Speaker 01

  You have now arrived at your destination.

• 2:39Harry Stebbings?

  Brian, this is such a joy to do. I heard so many great things before this episode. I was like, who should we have on? Who should we have on? Brian, you came up so many times. So I'm so thrilled to make this happen and thank you for joining me.

• 2:49Speaker 02

  Thank you so much. It's great to be here. You just do a terrific job on this program. So I'm flattered to be invited, to be honest. And I'm really excited. So let's do it. Let's go.

• 2:59Harry Stebbings?

  Brian, it's amazing how far a posh British accent can take you, but I do want to start with a little bit on you. How did you make your way into the world of startups, but most importantly, come to really be a part of some of the most powerful growth orgs with the likes of Facebook and now obviously most recently with DoorDash?

• 3:13Speaker 02

  So I'm really super weird dude. Everything about me is a total outlier. The first thing you need to know is I didn't go to college. I didn't drop out. I just didn't go. But it was totally not on purpose. It was just a complete accident. In high school, I figured out that my high school had this international baccalaureate program. And if you got into it, but then you switched out of it into honors, you could figure out your schedule. So you had no class in the last semester of high school. And I figured this out in grade 10 and I thought this was really funny. So I just did that. And then I got to December and it was like, okay, there's no class. And I was like, oh crap, what do I do? And at that time, my brother, he's a software engineer. He got hired at this company in Victoria, British Columbia called ACDC.

• 3:58Speaker 02

  They made like the software used to watch videos and images on your Windows 95 desktop computer. But basically I called up this guy and I was like, you should hire me. And he's like, how old are you? And I was like, oh, I'm 17. You hired my brother. And he's like, are you an engineer? And I said, no. And he said, send me your resume, which is Canadian for no, right? But I didn't know that. So this is the beauty of being young and naive. So I put together my resume and I put all these jobs on there. I had a news delivery technician. It was a tech company. So I was like, it's got to be technical sounding jobs. News delivery technician, marine ceramic technologist, culinary preparation engineer. He calls me back. He goes, okay, so you're a cook.

• 4:40Speaker 02

  You were a paper boy. What the heck is a marine ceramic technologist? And I was like, oh, that's a dishwasher. He thought that was hilarious. So he gave me a job. I turn up and he's like, hey, the guy who's figuring out search engines is gonna go get us a new office. Can you take over the search engine stuff? And I was like, okay. So that was AltaVista and Hotbot back in 1999. And Google wasn't even really a thing. That's how I started doing actually growth and tech. And it started right from the beginning when I was 17 years old in 1999.

• 5:13Harry Stebbings?

  I mean, I love marine ceramic. I mean, that is brilliant. I love that. Tell me, how did DoorDash come about?

• 5:19Speaker 02

  Yeah. So I was Facebook for 10 years. What happened was this guy Gokul Rajaram, he was at Google. He started up AdSense at Google and he stopped that and did a startup. And I was helping him out with that when I was doing a startup before Facebook. Then he jumped into Facebook and he pulled me in, introduced me to this guy, Alex Schultz, who's now like, has the weirdest job ever. I think he's CMO, Head of Data Science and Head of Product Growth. The weirdest job in the planet, but he's a ridiculously smart guy. So somehow I joined him. That's all because of Gokul. Bring up Gokul because Gokul works at DoorDash too. So when I was looking for my next adventure, I talked to Gokul and somehow I just fell down the rabbit hole.

• 5:58Harry Stebbings?

  10 years at Facebook in an incredible time for the company. If you were to isolate some key takeaways, what were some big lessons that stand out to you from 10 years there?

• 6:07Speaker 02

  Yeah. The first one I would say, people think about the innovations of Facebook, like the social graph or news feed or inventions like that. But a lot of the things that Facebook did that really, really mattered were like sort of organizational innovations or inventions about how the company was set up. So when I Arrived at Facebook, there was already this notion of a growth team. It was pretty small. I arrived and I was like, oh, this is what I do. It's like a blend of marketing stuff, email and channel stuff, integrated with product and it's all like considered one sort of thing altogether, integrated and working as one. That was something that Facebook sort of figured out very early on.

• 6:50Speaker 02

  So I arrived and I was like, wow, I didn't know what I did was called growth. The power of this is that you have a team and the team's product is a number. It is a metric. And so what that allows the team to do is to be free from most product or various teams around companies are restricted by, which is like the box of the pixels that they work on. So on the product team, I would say you open up any app, you point at something, you draw a box around it, that's a team. Facebook, you have News Feed, okay, News Feed team. You have Groups tab, Groups team. You can basically draw teams on the software. The idea of the growth team is that the product is basically a number. Like you're moving the number up from X to Y. And what do you work on?

• 7:33Speaker 02

  Well, you work on whatever is going to move that number up from X to Y. And you have freedom to figure that out. You have freedom to jump around and do the most important things, to change the product outside of the product and you bring that all together. And over time, you turn that into a whole suite of teams that focus on different inputs. But in the beginning, the real focus is each product is a little different. The things that matter for its growth are a little different. And the core innovation of this Facebook growth team is the product is a goal and not some pixels or some channel.

• 8:05Harry Stebbings?

  How do you answer the question for founders? Do we have a growth team that's integrated into product or marketing? Or do we have it as a standalone like Facebook innovated on? How do you answer that question?

• 8:15Speaker 02

  Yeah, for startups, so this I would say, it really depends on the moment in time for that company. In the very, very early days, the first thing you need to know about having a growth team, I feel really strongly about this. You should not have a growth team set up the way Facebook does or conceptualize it that way until you have product market fit. So I think we have to first talk about. What product market fit means before you can have a conversation about should I have a growth team?

• 8:42Harry Stebbings?

  What is product market fit to you then, Brian?

• 8:44Speaker 02

  Product market fit is retention and you can think about it as if you have a product, people use it. Think about it in terms of cohorts. So in the mathematical way, you can say maybe all the people who started for the first time using my product this month, maybe we take, we're sitting here in March. So we take the month of March, we take everyone who started using in March. Now let's follow them forward in time and isolate that group of people who started using the product and let's follow them. How many of them are still using this product on a regular basis in the following months? Often it takes a long time to know whether you have product market fit because you actually need enough time to see whether retention stabilizes. So we call these like J curves. It's basically you graph it from

• 9:29Speaker 02

  the people who started forward in time and you see what percent of that group is still around. Draw a point on the graph for as long as you need to. And if the graph goes flat or starts coming back up again, that's called like a smiley curve if it comes back up again. That's really good. But even if it just goes flat, that means you have product market fit.

• 9:47Harry Stebbings?

  But it could go flat until 1% retention and then it's flat. So at what point does it need to go flat?

• 9:53Speaker 02

  The point it goes flat at as a percentage of the beginning is how much product market fit you have. Okay. That's like how you quantify the amount of product market fit. So I'd say it's kind of like binary. You have product market fit, yes, no. If you're in 1%, 2%, I would say that's pretty much zero. There are some products that can survive with that kind of product market fit, but they are have to be really expensive because make enough money off of that retention from that small amount that it's worth to keep going. So normally, let's take an app or a consumer app or something like that. If you're like north of 10% steady retention, you probably have it there, there. If you're down in low single digit percentages, you don't have product market fit yet. And so in the early

• 10:36Speaker 02

  days, what I like to say is you need to have marketing in one form or another. You need to have people coming in to try your product. There's different models. Some teams do it with paid ads. Some teams do it with really great PR. If you can bring people to your product, then you can have some flow that you can work on improving it and measure your retention. But in the early days, if you don't have retention, all you have is a leaky bucket. And if you try to pour more in that, it's just gonna go away. You should focus first and foremost on retention. What I like to call is just that's how you measure product market fit.

• 11:08Harry Stebbings?

  So if we have that retention in this hypothetical startup, you're advising me. What do I do now? Do I get like a growth engineer? Do I get a growth leader? What's the next step?

• 11:17Speaker 02

  It really depends on how big you are. I like to think of having a product growth team is you have everyone there that you need to change anything you might need to change. And so I think of it as like a full stack pod. Usually that involves PM. You probably have a data science person. You need design. You need engineers of all the kinds that you're gonna work on. If you have apps or websites or backend, et cetera. Then if you have sort of like, usually I like to start kind of one full stack team. And it's important to have it all the functions because you don't wanna be blocked on doing the most important thing because you don't have a designer or because you don't have an analyst. So you really wanna make sure you have the flexibility to tackle anything that you might need to tackle. But then it all starts with understand.

• 12:01Speaker 02

  And I think this is like actually the most crucial thing. The way that companies who start a growth team screw this up. Because I saw this a lot at Facebook. So what happened at Facebook was there was the notion of the Facebook growth team. And then what happened was we got asked to do advertiser growth. So I don't know if you remember Facebook's disastrous IPO.

• 12:22Harry Stebbings?

  Yeah.

• 12:22Speaker 02

  But it was disastrous. The stock price just completely tanked. The street was like, they're not gonna make the shift to mobile. And there was two problems, supply of ads and demand of ads. Well, supply of ads was fixed with the creation of newsfeed ads. But then you needed a lot of advertisers to buy that. So then I remember this meeting distinctly getting pulled in and being asked, "Okay, Mark and Cheryl, they want you to try to do the same thing we did for consumers for advertisers. Can you go make an advertiser growth team?" I recall distinctly going, "I don't know if it works that way." Like, does it work for advertisers the same way it worked for consumers? And low and behold, it did. And we were able to massively increase the number of active advertisers,

• 13:03Speaker 02

  like, from almost no growth to multiple hundred percents growth year on year after one year.

• 13:08Harry Stebbings?

  Can I just go back? Sorry, I'm thinking about kind of the people in those teams. Do you pull them out of their existing teams then to put them in that new growth organism? Do they sit in both? Like, if I'm the founder, should I pluck PMs? Should I pluck designers and put them in this new organism?

• 13:24Speaker 02

  Well, I would say with that, what you want to do, you really want to make sure that the people who are joining are bought into what they're doing. So I've seen fail states where, like, a team rally, this is kind of where I was going, but like, a team rallies and they create a growth team. It kind of comes like top down from somebody, the CEO or the founder or some VP. Or it creates itself spontaneously in some of these bigger companies. None of the people inside that group have any experience doing this. That is like a recipe for complete and utter failure. So I would say most of the time when I see these teams fail, there isn't really anyone who has done, has deep expertise in this sort of thing.

• 14:07Speaker 02

  A lot of the things that matter are super counterintuitive. And we can talk about all the things that are counterintuitive about growth. It's super counterintuitive. So if you're walking in cold, not knowing how it works, and you don't have anyone leading it who's done it before, really you end up with just a complete fail state.

• 14:24Harry Stebbings?

  Sorry, what are the counterintuitive things? I love counterintuitive.

• 14:27Speaker 02

  So the first thing, what companies naturally do once they have product market fit is that they build for themselves. Okay, they build for themselves because they're all employees and everyone who uses the product is an employee. And if you work there, then you use it a lot. Companies naturally pivot really hard to building for their power user. And that's because they are their power user by virtue of the fact that they are there, working there, right? So that is super supernatural tendency. But what a growth team needs to do is obsessed about marginal users. These are all of the things that get in the way of somebody using the product when they're not like, don't really have a ton of intent. So you can think about growth as like there's a curve.

• 15:11Speaker 02

  On one side, you can increase growth by increasing intent and making the people more interested in your product. And the other thing you can do is make it easier to use. You can make it easier to get in there, to sign up, to log in, to open it again, etc. And the truth is that it is way easier to reduce friction and make things easier than it is to increase people's intent. So it's much easier to push on that side. And so when I say a marginal user, I mean the user that you would have lost that's on the margin of not using you at all. And so a lot of what growth is doing, moving people from zero to one. You're like taking them from not using your thing to using your thing. And all the things that take you over that way.

• 15:55Speaker 02

  So I'll take one, people, companies almost never think about this, but login. Like login, really important for growth. Most companies put login teams inside of security. So the login team lives inside security team. And what is the security team responsible for? What is their metric? They're responsible for stopping bad guys. So are they obsessed with making the, all the marginal users who are having, struggling to log into your product, making sure they can get in? Heck, no, they're not doing that at all. They are like actively like trying to block bad guys. One of the teams, and it took us a long time, honestly, at Facebook to like really figure out that we needed to have an explicit login team inside growth. But when we did, it was fantastically impactful. Gosh, here's a classic one.

• 16:40Speaker 02

  You go to do your password and you're like, I can't remember my password. So then you go to like password reset. And we've all done this before. You type in and it's like, okay, cool. I go to my email, I get the link and then they're like, okay, you have to create a new password. And you're like, okay. And then you type it in and what does the damn thing say? It says, you cannot use your existing password again. And you're just like, are you effing kidding me? Just like let them log in and that like. They're trying to get into, they're not actually trying to reset their password. They're trying to just get it. And now you're saying, it's the same password again, Facebook. And you should just log them in right, right then and there on the spot. And people are like, if they're using an app like DoorDash, they're hungry. And if they just can't log in, they just go make a sandwich.

• 17:24Speaker 02

  If they're trying to get into Facebook or Instagram and they can't log in, maybe they just decide to watch TV instead or go to TikTok. It's all of these moments in time when someone could get blocked by something. And a lot of these things are highly technical. That's what's kind of counterintuitive about growth. I think a lot of times teams are trying to think of solving their problem to try and increase growth. But their problem is a power user problem, not a marginal user problem. And they're focused on the wrong people.

• 17:53Harry Stebbings?

  How much of your decisions are driven by gut versus data on those marginal users and the science?

• 18:00Speaker 02

  I would say 95% data, very, very tiny amount gut. And this is the other thing that teams really misunderstand. If you're trying to do growth and you don't have a whole bunch of data horsepower, one way or another. When we looked for product growth people at Facebook, we tried to find people who knew SQL. You would try to get PMs who know SQL. And you would try to get a lot of data scientists and data engineers in these teams. What you really want to do is you want to find the places where people are getting blocked. So it's a ton of funnel analysis, looking step by step by step by step. It's a ton of going through the flows and looking for anything that could be confusing, cutting it by one place or another and finding those drops.

• 18:42Speaker 02

  And then coming up with hypotheses based on where the data told you the opportunity is, to then try and run experiments. And what a lot of teams do is they jump straight to experiments. And they spent way too little time on understanding what is going on with their product and identifying where the biggest opportunity to improve it is.

• 19:03Harry Stebbings?

  Do I need to, I'm the founder. Do I need to set up the data acquisition funnels and tools before hiring the growth team and the growth professionals? Or can the growth professionals set up the data acquisition tools themselves?

• 19:13Speaker 02

  Well, they can send them. Up themselves. But if I'm the founder, I want to know these people who purport to know all about growth are really data people. So I would think that it's like an interview question.

• 19:26Harry Stebbings?

  That's what I actually really wanted as well, which is like, I've never hired growth professionals, Brian. I'm a complete newbie. How do you structure the hiring process for growth professionals today? How would you do it?

• 19:37Speaker 02

  Yeah, so I would have two things. The first thing you need to know is you can't just hire a growth professional and then unleash them on your company and expect anything to change. You really need to think about it is if you're going to hire a growth leader, you also need to think about I'm need to hire a growth leader and I need to make sure that this, the resources are there for this leader. The engineering, data, design and marketing and marketing budget. It really depends on the particular situation, the particular product in question. You're not hiring a growth professional, you're hiring like a growth team. And you can structure it in a couple of different ways, that's less important, but you need to make sure you're thinking full stack. That's a bigger investment for a startup.

• 20:17Speaker 02

  It's a team maybe that I would use to create my next set of features or go after a whole new market. Now, usually if you have product market fit, extending and growing the penetration of something, that's really hard to get product market fit. So I'd say it's almost always a really terrific investment, but it will fail if you're just thinking about hiring just like the one person. Think about hiring a person who's going to hire a team and set it up the right way. So now you're thinking about it that way. Now, how do you find the person who's going to know how to do that? You really want to make sure that you're asking them like, how do you think about growth? Does this person ask you about retention at all? Does this person ask you about anything about the team they're going to have? Do they ask you about the state of your data?

• 21:00Speaker 02

  Are they curious about whether you know anything about your funnel drop offs or any of these kinds of questions?

• 21:06Harry Stebbings?

  So what are the signals of the 10x hires that you've made or you've seen? How do they respond? How do they behave?

• 21:12Speaker 02

  They will be extremely curious. They'll have a lot of questions for you about how the product is doing, of the retention and all these kinds of things. Because they will fundamentally know, in growth at least, that they don't want to get involved in this situation. Where they don't product market fit, or the company's not actually ready for them to be there. Because they probably will have ended up in situations where it wasn't very good. And so they have the experience to kind of know that and they will like remove themselves out of the process. Or they'll be really excited that company kind of has a lot of the right pieces in place. The second is they will usually have opinions about how things are doing. I remember interviewing this one woman.

• 21:52Speaker 02

  She started going through all the flows and started nitpicking all the details and they were all the right details. And I was like, okay, this person is going to be fantastic, very, very detail oriented. In growth, it's all about the details, very small details matter a lot.

• 22:08Harry Stebbings?

  Is there a way that you test people? Like, do you put people in a situation where they have a case study? They have a workflow to go through. Do you test them in the real world?

• 22:17Speaker 02

  Yeah, absolutely. One is being really structured about the various things you're going to test them on. So I like to have someone who is really experienced with data, test them about data. So like, I'll have a whole interview about analytics. Another is give them a gross case study, not usually not the one for the company that actually about. It's usually one where it's sort of neutral ground. It's important not to be biased by your own knowledge. So it's better to look at someone else's app and then have them do like a breakdown. So it'd be like, here's a registration funnel for, I don't work at Airbnb, so Airbnb. And then can that person look at step by step? Are they asking for the data that they would need that's the right data? Are they looking at the things that are confusing?

• 23:02Speaker 02

  Are they obsessing over the right details?

• 23:04Harry Stebbings?

  We've brought in the data, we've given them a case study. Is there any other steps, are there any other must-asks? Anything that we haven't done that we should do?

• 23:12Speaker 02

  Then the main thing is you need to figure out whether this person can be a good leader and a good manager and can manage a team. Because if you're the founder and this isn't your domain, then you need to make sure that they're not only good at growth. And the other way I see this fail is you bringing in someone who's like really a hot shot individual contributor, but they're not really a manager or leader and they've never really had to manage the whole. Team and then you like shove them into a situation where they can fail because they've never done that before. I would say you want to up level in terms of also getting someone seasoned who's have has management experience before has led the teams before. And so that's why often PMs tend to be really good people because that's a large part of the job naturally.

• 23:56Speaker 02

  There can be other different ways. It's more of this management leadership skill set because you need to integrate everybody together.

• 24:01Harry Stebbings?

  So we find this incredible candidate. They have the leadership abilities. They have that data mindset. They are perfect, Brian. We hire them. I think the thing me and you probably see more than ever that's challenging is integration and onboarding. What do I do day one? I'm the founder. Like, how do I set this new leader up for success? As the founder bringing them in now on the onboarding process.

• 24:22Speaker 02

  Well, you should have started two, three months ago. Getting all of your others leaders aligned that you're going to do this thing. Because the other way you can mess it up is where everyone else is really insecure or tries to block this from happening. You see this sometimes because of the nature of what I'm talking about. Most companies, they have their boxes. So everyone's used to having their little domain and the other teams are not really getting in there. And trying to mess with their code or change anything about their system. So for this to work, you have to have a culture where everyone knows that this team is going to be trying to grow the whole pie for everybody. And add just more fuel behind the engine, right? More people through, more people using.

• 25:06Speaker 02

  And that that means they might need to go and touch. So like if the security team is really, why are you trying to mess with my login flow? Right? To our earlier conversation, that's not going to go well. So it really worked at Facebook pretty well because there was a culture that other teams were allowed to touch other people's code. A good friend of mine was working at growth at Google and they really have a totally different culture about this at Google. Where it's really hard to go and change anyone else's code if you're not in that department or you're not in that team. And so it's really hard for like structurally this concept of a team, like I said, that can go and change whatever they need to change to drive growth. If there's a culture of don't touch my stuff.

• 25:47Harry Stebbings?

  How do you allow growth teams to be their best selves without bluntly fucking off engineering teams? Cause they come in, play with the code, have a little mess around and then sold off and leave, get their data.

• 25:58Speaker 02

  Exactly.

• 25:58Harry Stebbings?

  So how do you create that harmony when there's inherent friction?

• 26:02Speaker 02

  Totally. It's really important. Like also the growth team folks can't be cocky and pushing on everybody or anything like that. That's not a good environment. So they really have to be very collaborative and it's really important that your leader has a collaborative attitude. So I think tactically, the way to do that is you make sure that the team, that if the growth team's coming in, working on someone else's code, that team is agreeing to do diff reviews and check it. So it becomes a back and forth and it's not a one-way street.

• 26:29Harry Stebbings?

  What would you say are the biggest red flags or the biggest ways that these new hires fuck up in the first 90 days?

• 26:36Speaker 02

  I mean, I think if one of those components I talked about is like way off, they're not really data oriented and they are assuming the thing that worked at their last company is exactly the same at this company. And they're just doing that. That's a real common fuck up, right? It's because it's like our fail state. That might not be where the drop off is. The problem might be somewhere else. And if they never bothered to get really intimately familiar with the data and all the steps along the way for the user, they're hitting the wrong target. So one is like, you assume it's exactly the same as your last company. I can tell you it's not. It's not, but it rhymes, right? It rhymes, but it's not the same. The other is they pissed everybody off and they try to plow into everything

• 27:19Speaker 02

  without building any relationships. That's another way they can really screw it up. They can be set up for failure where they weren't given the resources to do the thing. And then they're like, okay, I found the opportunities. Here's that we need to go do it. But then through some breakdown, like finance isn't funding the engineers or whatever is necessary to do it. That's probably the third biggest fail state.

• 27:41Harry Stebbings?

  You mentioned that kind of using historical data or experiences to make decisions on new experiences. Can you take me to a growth decision you made without data to back it up? How did it go and what are some takeaways for you?

• 27:53Speaker 02

  Oh man, I think for the most part, you can have a hunch that some. Something might be really important. Sometimes there isn't data to say one way or another, or like to be conclusive. I'll give you like a positive one and I'll give you a negative one.

• 28:07Harry Stebbings?

  Yeah.

• 28:08Speaker 02

  Okay, so a positive one is one thing that's really interesting about growth is that like buttons really matter. So this is often extremely counterintuitive to people. The placement of the button, the color of the button, words on the button matter a lot. In advertiser growth for Facebook, we created a new button so that you could buy an ad directly from a post. The button originally said promote. Now, it was a huge success. A lot of people were buying ads from that because it removed a lot of friction. They didn't have to figure out their creative. They already had a creative and they could just turn it into an ad. The mistake we made was that we were thinking about it like an ad, but the companies or the small business owners did not know what that meant. They were like, what is a promote? So I didn't have any like data to say that.

• 28:53Speaker 02

  I just had anecdotal conversations with some people. I was like, look at this amazing new thing. And they were like, what is a promote? I don't understand what you're talking about. So then we changed it to say boost post and that increased dramatically. I think I said this publicly, so I can talk about it. It increased people buying ads by seventeen percent. So just changing the word on the button was a seventeen percent increase. So I didn't really have data. I just had anecdotes and that one worked out really well. Now that was okay. It was really simple change and very low cost. Another one in Facebook land was we were obsessed with this idea, like the onboarding experience. And we were trying to come up with all these different ways to try to ramp people up.

• 29:35Speaker 02

  Now, in the end, all we had in terms of data was a bunch of people don't ramp up, right? So I don't know. It's not like conclusive data about this problem, that problem. Honestly, that whole effort, we did a whole bunch of things. In the end, the only thing that really, really mattered was friending. Do you make friends on the platform? That's what mattered. And everything else that kind of mattered ultimately went back to friending. We figured out like, oh, if we can get you to tell us your college, that will help you ramp up. But why? Well, it helps the algorithm figure out who you might be friends with. So it helps.

• 30:08Harry Stebbings?

  There's been a lot of discussion about when you reach seven friends that you added, that was the moment your Facebook knew you. Is that true? Or is that a bit of a?

• 30:15Speaker 02

  The myth of the magic moment. Okay, so I would say there is a total myth of the magic moment. Now, I also perpetuate the myth, so I'm partially to blame. But the reason I will say this, so this is really fun and interesting. The reason I say it's a myth is because there's no like magic drop off in the graph. Where all of a sudden someone is a hundred percent retained forever and ever. That's not a real thing. It's a smooth curve. As you know, like if you look at retention by the number of connections, the number of friends someone finds. It just goes up and up. It continues to go up into the hundreds. Two hundred, three hundred, four hundred. It still helps. So there is no like magic moment. The thing was twenty friends in twenty eight days or something like that.

• 30:58Speaker 02

  That is a myth, but it's a very useful myth. And the way it's useful is that it gives a team a concrete thing to try and go do. And it's way easier to operationalize for a team. Get all the new users to twenty friends and be really clear about the thing you want them to go do. That's just a shorthand for like, it's eighty percent of the value of retention of friending. But it doesn't mean that it suddenly goes to zero at twenty one. Like, that's absolutely ridiculous. The most important friendship to go get is the first one. So that one is way more important than nineteen to twenty. The myth kind of then after a while becomes a problem. Under twenty friends is high value and they just try and get everyone high value friends to help in.

• 31:39Speaker 02

  But actually, it's a curve and it's a smooth curve where the biggest jump is from zero to one. And then from one to two, it goes down slightly as a diminishing return curve. So mostly, these things are diminishing return curves and there is no magic moment. It's only an operational thing for the team to help them focus. That's why we talk about this magic moment, not because it actually works that way.

• 32:03Harry Stebbings?

  Are there any other big myths that you hear about Facebook's growth that you find entertaining or funny or misconceptions?

• 32:09Speaker 02

  I think there's a myth that somehow this team is magically somehow better at growth than everyone else. I think the team is just incredibly, incredibly focused and incredibly set up for success. And that that is actually replicatable at other companies. But it's actually really hard to replicate because you have to understand, like this whole conversation. There's like 10 or 15 nuances to doing it well. If you don't really understand all of the things that are going into that, it will fail. And so that's why there are a bunch of really successful growth teams out there. But there's a lot of failures. It's because I think fundamentally, the people setting it up misunderstood what they were doing. And so then it fails because it was not set up for success or you hired the wrong people.

• 32:53Harry Stebbings?

  Do you want to dive into my favorite though, Brian, which is a quick fire? So I say a short statement, you give me your immediate thoughts. Does that sound okay?

• 32:59Speaker 02

  Let's do it.

• 32:59Harry Stebbings?

  So what growth tactics have not changed over the last five years?

• 33:03Speaker 02

  The kind of product growth tactics have not changed. Buttons mattering, things like optimize your registration funnel, things like notifications. Any kind of friction, removing errors or removing things that confuse the heck out of people or things that are broken. That fundamental, making it friction free and smooth and clear and easy for people, which is really easy to say and really hard to do, has not changed at all and that will never change.

• 33:31Harry Stebbings?

  What tactics have died a death on the flip side?

• 33:33Speaker 02

  Oh man, in the early days of early wildcatting days of social stuff. Basically, none of the platforms, they all were trying these interesting like platform things. There were ways to hack those systems and get a whole bunch of traffic really fast. Or Google, like the early days of Google SEO where you could like spam things and trick the algorithm into giving you the top rankings and stuff. All of that stuff is dead. All the platforms hate that stuff because it makes their product worse. And so they have relentlessly killed that stuff. So I think the lesson in that is I never really did that much of that stuff. But I have a lot of friends who worked at companies who were trying to hack and spam and these kinds of things.

• 34:17Speaker 02

  And the lesson is like, don't do that stuff. Cause one day, if that's your strategy, there's a whole group of people trying to kill what you're doing. You never want your whole like growth strategy to be something where there's someone out there trying to stop you.

• 34:31Harry Stebbings?

  What would you most like to change about the world of growth today?

• 34:34Speaker 02

  I would banish the term growth hacking. So it's not hacking if you're doing it properly. And I would say, actually, if you're talking about growth hacking, at least a yellow flag. Because ultimately, if you're doing it well, what you're doing is you're doing great marketing, where you're explaining the value of your thing. And then you're helping people to onboard and realize the value. You're optimizing things to remove all the pain out of the process. And you're communicating to try and bring people back to your product. It's not that complicated, but it is not hacking. Relentlessly improving every step along the way and making it truly frictionless and easy. It's really hard. None of those are like hacks, though. I would say the hacks are the kind of spammy stuff.

• 35:18Speaker 02

  You hacked the thing and then you got all this traffic, but then someone shuts you down later. So I'm always wary of the term growth hack because inherently sort of makes it sound like you're not trying to do this in a sustainable, repeatable way. That's really the way to drive growth over decades. I mean, look at these companies like a Facebook or a Google or a DoorDash. Like they've become important. Their overnight successes, like in their seventh or eighth year of existence. And then after they're an overnight success, they keep growing. Like, look at Amazon. It like was an overnight success in like 2007, 10 years into its existence. And then it spent the last 14 years to get to the point where almost everyone in America uses it. 25 years.

• 36:01Speaker 02

  I mean, these things, if you wanna do them and you really wanna have amazing, incredible, best in the world companies, it takes a long time and it takes just relentlessly. Getting one percent better every day for over and over again.

• 36:14Harry Stebbings?

  The final one, my friend. What one company growth strategy have you most been impressed by recently?

• 36:19Speaker 02

  I like the really boring ones, basically. I love companies like Airbnb. I love companies like Facebook or Google or DoorDash or these kinds of things where they figured out something that people fundamentally want. And then they're just like working on grinding on making it better and better and better. The best growth strategy is you show up a year later and a year later and a year later. And you can feel how the product has gotten better and better and better. Or you'd used it two years ago and you come back, you use it again and you're like, wow, this has improved a lot.

• 36:52Harry Stebbings?

  Why did you see that most recently?

• 36:54Speaker 02

  Like, I would say I was really impressed with Airbnb, just the way that booking has gotten a lot clearer. It's gotten a lot easier. It's gotten a lot better. So I'm really impressed with they've done over the last three or four years. Honestly, TikTok has been pretty darn impressive. In the early days, I thought it was really difficult to use and figure out. And now, like, I always like got in there and I was like, okay, it's really hard to create one of these things. It's really confusing. None of these buttons have labels. I have to understand all the swiping. I don't get it. And then I showed up a year and a half later and I was like, oh, like, they've actually gotten rid of a lot of the unintuitive things. So TikTok, I would put in there as another one where they clearly have embraced this kind of growth mindset and they're doing it.

• 37:39Harry Stebbings?

  Brian, this has been such a joy to do. Thank you so much for putting up with my very basic questions, but I've so loved doing it and I really appreciate the time.

• 37:47Speaker 02

  Absolutely. It's been absolute pleasure. I hope that it's been educational somehow. And I really appreciate you taking the time with me today.

• 37:56Harry Stebbings?

  I just love doing that. So many great stories from Brian there and what an incredible character. If you'd like to see more from us behind the scenes, of course you can on twentyvc.com. But before we leave you today. If you're a founder or running a startup, I want to tell you about Brex. Brex combines high limit credit cards, expense software and payments into one platform to help you scale smarter and faster. Go to brex.com forward slash growth podcast to get a corporate card with. 10 to 20 times higher limits, great rewards and expense tracking, plus a business account with no transaction fees and there's no personal guarantee or credit check. Apply 100% online at brex.com/growthpodcast today and you'll get up to 50,000 rewards points. And speaking of equipping your team with Brex there, let's face it,

• 38:40Harry Stebbings?

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• 39:25Harry Stebbings?

  to ensure that they are structured for growth and long-term success. So to learn more about the number one most active law firm representing VC-backed companies going public, head over to cooley.com and also cooleygo.com. Cooley's award-winning free legal resource for entrepreneurs. As always, I so appreciate all your support and I can't wait to bring you a fantastic episode this coming Friday with Enrique at Brex.