Dan Hockenmaier: recommendation

Transcript context

…Awesome. So say that somebody has been listening to this episode, maybe they've heard it, they've listened to it three times now and they're just like, "Hey, I got a model that kind of feels like the beginnings of something." What do you do once you have a growth model? How does it actually inform what you do as a startup? It's very helpful input into a quarterly or annual planning process. It depends a little bit on the stage of the company, but say you're at the stage where you have maybe 10 or 20 product pods which are allocated across various parts of the business and you're going through annual planning. Often you want to do a zero based accounting exercise where we say we want to from the ground up decide how those people should spend their time and there's some kind of pod allocation exercise where we're deciding which places those go to. The most difficult thing about making that kind of effort is developing a common currency by which you can trade off their efforts. So this team is saying they can move this metric by X and this team is moving this metric by Y. I have no way to make those two things comparable. The growth model is the function that lets you do that. And so you can have this analyst or this finance person we talked about who is operating this model work with the product managers to run those scenarios through this model and generate it into a common currency. So now we have a spreadsheet that says these are the things we could work on. This is roughly how it will impact our short or long-term growth. Now you have the ability to make much better kind of allocation decisions. So that would be at the most macro level. And I think the more micro one is for an individual product pod, I have this north star goal, which levers should I be pulling? They should be using their mini models to make that assessment. If you look at the strategy doc for a product group or team, I think that having a model like this should be a core part of that because that way they can articulate what it is they actually [inaudible 00:19:18]. Have you found a model doing this exercise, coming up with a growth model for a company or a startup you've worked with, radically shifted the way they think? Is there an example that comes to mind of, "Oh wow, we came up with this," and they're like they didn't even know this was a huge lever and that changed the way they approached growth.…

Stored transcript either side of the excerpt. The highlighted words are the published quote; the surrounding text is unedited source, never generated.