Lenny Rachitsky: belief

Transcript context

…What I would say is the rules are true everywhere because they're based in the mechanics of finance in the business. You're right that in the consumer segment or small business segment for that matter, they tend not to grow. So that doesn't mean the NRR question is invalid. It means, dang, we can't think of anything. That's okay. Then you go onto the next question because you can't think of anything, but it would be more strategic if we could. And are we trying hard enough? As a consumer, I do not want to spend more with AT&T, but they're also not giving me any more value. But there are other products as a consumer, like Amazon, where they do. So you're right, but it would be as a product manager, it would be 10 times more valuable for you to think of something like that than to move on to other things, et cetera, or there's other ways, like other products. We didn't talk about it and it's okay because of course each one of these, you could go on forever, right? But another way is a second product. A second product sold to the same segments that you're in so that your existing customers can buy it. Well, I don't know why that wouldn't work in consumer. It certainly works in consumer in apparel. I think about AG1, which has all these new... I'm doing their sleep supplement, and there it goes. They're just like, "Here's a new thing you can buy." Yeah. So is it harder? Yeah, of course, of course. All of these are easier, harder in different segments and ways. Of course, of course. I'm not trying to say otherwise. But I would say the mechanics of how the finances work is the same. You're just saying, " I don't have this lever to pull." And then I would say, "Okay, well then you need different levers." One that we didn't talk about is one way to offset the cancellations is existing customers grow, but another way is if existing customers bring in new customers. So they didn't grow, but they brought their friend. Now, this is absolutely something that happens in consumer, but it's also an answer to this thing where cancellations grow exponentially, because existing customers bring in new does triple if you have more existing customers. Aha. So this is stuff like refer a friend and all this kind of stuff. Again, some of this is obvious. We don't need to enumerate that. So those things are good. And so in consumer, you might say, "Oh, it's easier to try to get someone to invite a friend with a coupon and blah, blah, blah, blah, than it is to try to get them to grow," but in B2B, that may not be true. I don't get a mid-size company to refer. That doesn't make sense. So once again, this question of how do we have the existing base help us grow is still correct in consumer, but its manifestation could be very different. Of course, I agree with that. But I mean, how could we not say... I mean, of course, things like word of mouth and invite a friend, of course that's enormous with consumer, and this is one of the reasons why.…

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