In the last 6 months or so we’ve been focusing hard on growing our business. We’ve spoken to some amazing entrepreneurs and also learned some lessons ourselves the hard way.
We’ve put together a 7-part free email course on our top growth strategies.
You can sign up to get 1 email per day below or read on to get them all in one hit.
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1. Improve retention
Sean Ellis was one of our favorite guests. He’s a very smart marketer and invented Growth Hacking. He also helped grow multibillion dollar companies like DropBox.
A lot of entrepreneurs figure that if you lose a customer, then you can simply go out and find another one. This is an easy mistake to make.
The best businesses are obsessed with retention. They know that when you lose a customer you don’t just lose that customer. You lose a referral partner. You lose a valuable member of your audience. You lose the chance to market to their network. You lose their lifetime value.
As a business owner, you should understand churn and actively manage retention.
Here are some tips to grow your business by retaining more customers.
Qualify potential customers to make sure they are the right fit for your service. We know that people who want a one off fix or work as a freelancer aren’t good customers for our WordPress support service, so we help them find an alternative instead of signing up. Other red flags that you should look out for are people who ask for discounts or people who are aggressive or seem to have unrealistic expectations.
Be proactive instead of reactive. Regularly touch base with your customers and try to be genuinely helpful. This can be achieved by an email, a phone call or regular touch points. We do this by proactively suggesting fixes on a weekly basis.
Measure your churn. Don’t get too bogged down in the 100 different SaaS dashboards or formulas available online. Simply track how many people are leaving as a weekly metric and once you have an idea of your churn rate, set a plan to reduce it.
Ask people why they are leaving. You’ve got nothing to lose and everything to gain. The answers might surprise you!
Remember – even with the best growth hacking techniques, business growth won’t happen unless you retain your existing customers and have them promote your service by word of mouth.
You can check out the full interview with Sean here.
2. Build a team
Chris Ducker knows a thing or two about outsourcing. He runs a call center with 300 staff in the Philippines and he’s matched thousands of entrepreneurs with virtual assistants with his sourcing company Virtual Staff Finder.
He also knows a thing or two about burnout having experienced it twice himself.
Chris’s perspective is entrepreneurs have a choice. One option is to continue doing everything yourself which is a path to ultimately burning out. The other choice is to build a team and ‘let go’ of tasks you simply shouldn’t be doing yourself.
For under $500 / month, a full time virtual assistant does make a lot of sense. Chris suggests a bunch of tasks that you shouldn’t be doing:
Formatting blog posts
Research for content you are putting out
Manually updating Facebook each time an idea pops into your head
Spending hours a day filtering the crap out of your inbox
Chris is a world authority on outsourcing and has recently put together a book on the topic called Virtual Freedom. In there he discusses how to go about building a team of virtual assistants to do these kinds of jobs for you.
We chatted to him about it, and you can check out the interview here.
3. Build a network
Today’s growth tip came to us through 2 different successful entrepreneurs, Wade Foster from Zapier and Erica Douglass from Market Vibe.
Both entrepreneurs went through startup incubators and as a result were able to be part of a network of like minded entrepreneurs. That network landed very tangible results.
In Wade’s case it meant landing $1.2m in funding only weeks after wrapping up at Y Combinator. He was also able to get meetings with key people for integration partners who ended up becoming their biggest growth source.
Erica was also able to make some amazing connections which has helped her in negotiating a big round of funding. I also saw recently their first live implementation was on Brad Feld’s blog. I’m pretty sure that wouldn’t happen without some solid networking.
In fact most of our guests have mentioned relationships with other people as being a huge factor in the growth of their business. Charlie Hoehn talked about how he’s worked on relationships for 14 years before launching his book. Chris Ducker talked about attending physical conferences and meeting people who are actively helping push his book to huge audiences.
If you are interested in networking with like minded entrepreneurs, check out our private founders community. It’s a qualified group of smart entrepreneurs who like you, are looking for ways to grow their businesses.
You can check out the interview with Wade here and the one with Erica here.
4. Have one metric that matters
I grew my last business consistently. Year after year I was making more money. The problem was that I was growing revenues not profits. My profits were actually stagnant and they were that way because my business model was broken and unprofitable.
In our current business, we measure how much money is left for us after our expenses. We measure this every month and we have estimates for our profit margin now and in the future when we are no longer actively involved in service delivery.
Your metric of choice may be slightly different, but be careful if you are measuring something other than profit. If you are doing that, you might be growing a business that is fundamentally unprofitable.
My suggestion would be to:
If you don’t know your exact profit margin, make sure you always have an estimate of it.
Also consider how the business looks without you and what your profit margin would be.
Constantly keep an eye on this number and re-test it from time to time, to make sure what you are building is consistent with your estimates.
It’s ok to get excited about revenue, but for most businesses revenue is only useful if you have profit margin built into your business. Without it you are just creating more problems and making less money.
You can learn more about my story with my last business here.
5. Test all assumptions
When we started WP Curve, we thought we knew why customers loved the service. We were also convinced we had a great way of hacking the growth and signing up multiple customers at a time. On top of that, we thought we had the perfect ideal client profile.
We were wrong.
The first time we were wrong, it took us 4 months to realize. As we failed more, we failed faster. Instead of saying “this should work” we started to ask “is this actually working?” and “what does the data tell us”.
Assumption 1 – We thought clients loved the service because it gave them peace of mind.
Reality – When we actually asked customers, they actually loved how responsive we were (we fix most WordPress issues inside 6 hours), and didn’t mention peace of mind.
Assumption 2 – We thought we’d found a perfect client profile.
Reality – When we implemented a strategy to sign up our ‘ideal clients’, the clients we signed up were actually difficult and a lot of them left. We revised the profile based on real data, not assumptions.
We’ve learned now to recognize when we are acting out of assumptions and to test them quickly. As a result we’ve been able to grow the business very quickly, signing up over 200 monthly recurring customers in 7 months.
A great way to figure out if you are acting on assumptions rather than data is thinking about how you think. It’s meta, I know… but stay with me.
Are you making decisions on gut feel or what you’ve seen work for someone else? Or are you making decisions based on data and actual results and feedback from your customers?
Alex covered a few of these points in his A-Z of learnings in his first 6 months as an entrepreneur.
6. Find a co-founder
Entrepreneurship is a tough ask. The ups and downs of running a startup can be too much for one person to shoulder. Combine that with the fact that it’s virtually impossible for 1 person to have all skills necessary to create a great company and the case for having a co-founder is clear.
Don’t take our word for it. Paul Graham, who created Y Combinator lists not having a co-founder as the number 1 reason startups fail to grow.
To us, there’s 4 key reasons why having a co-founder is going to help you grow your business:
You simply don’t have all the skills yourself. If you can afford to hire people who do, then that’s great. But startup founders are worth a lot of money, and a lot of self funded companies can’t afford to pay someone what they are worth, at least not initially.
Co-founders will be there to share the journey with you and offer you emotional support. Spouses can help too but you can’t expect them to really understand your business and your struggles.
You will make better decisions with 2 perspectives available. It’s very tough to continue to make great decisions in a business by yourself.
It’s much more fun to enjoy the startup roller coaster with someone. If you are happy you will work better and faster and you won’t quit. That is only going to help growth.
Here is a post where we wrote about why to get a co-founder. Here is a podcast where I discuss how we got together and started our company.
7. Learn to say no
Let’s compare my 2 businesses.
Business 1 – This business did web design, development, hosting, SEO, content, elearning and training. You name it, I did it. From tiny jobs as small as $100 and to massive, multi-month projects worth $32,000.
Business 2 – 24 / 7 unlimited WordPress small jobs for $69 / month. That’s it.
After 7 months, WP Curve was more profitable than my first business was after 7 years.
The only way we are able to have such a simple business is to say no to anything that doesn’t fit into that model. That’s meant:
saying no to literally hundreds of agencies and freelancers
saying no to tens of thousands of dollars worth of one off projects and consultancy gigs
saying no to any kind of design work
In fact we say no to everything that doesn’t neatly fit into what we do best. That enables us to grow, because the simplicity helps every aspect of our business. Team planning, staff management, new customer acquisition, payments, service delivery, every aspect of the business is easier because it’s such a simple and consistent business.
So our final growth tip, is to learn to say no. You can read more about that here.
What is your top growth strategy
I’d love to know how you are growing your business. Let us know your top growth strategy in the comments below.
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