a16z Podcast | The Basics of Growth 1 -- User Acquisition

1. 0:00 – 1:47

   Growth Is Not a Hack: Businesses Don't Grow Themselves

   1. SCSonal Chokshi0:00

      Hi, everyone. Welcome to the a16z Podcast. I'm Sonal. Today's episode is all about growth, one of the most top-of-mind questions for entrepreneurs of all kinds of startups, and especially for consumer ones. So joining us to have this conversation, we have a16z general partners Andrew Chen and Jeff Jordan, and we cover everything from the basics of growth and defining key metrics to know, to the nuances of paid versus organic marketing, and the role of network effects, and more. Part one of this conversation focuses specifically on the aspect of user acquisition for growth, and then we cut off and go into the aspects of growth for user engagement and retention in the next episode. But first, we begin by going beyond the concept of growth hacks and beginning with the fundamental premise that businesses do not grow themselves. So the topic we wanted to talk about today is growth, which is a big topic [laughs] . What would you say are the biggest myths and misconceptions that entrepreneurs have about growth?

   2. ACAndrew Chen0:57

      You know, not only is there the misconception that it happens magically, then the next layer, I think, is that it's really just, like, oh, a series of, like, tips and tricks and, like, growth hacks that kinda keep things going, as opposed to, like, a really rigorous understanding of how to think about growth, not just as the top-line thing, but actually that there's acquisition, that there's engagement, that there's retention. And each one of those pieces is very different than the other, and, and you have to, like, tackle them systematically.

   3. JJJeff Jordan1:25

      Done right, it is a scientific discipline because it requires you to understand your business and business dynamics at this incredibly micro level.

   4. SCSonal Chokshi1:35

      I love that you said that because one of the complaints I've heard about growth hacking is that it's just marketing by a different name. And what I'm really hearing you guys say is that there's a systemic point of view, there's rigor to it, there's stages, there's a program you build out.

2. 1:47 – 4:21

   Growth Gravity and Layering the Cake

   1. JJJeff Jordan1:47

      If you're fortunate enough to achieve product market fit and your business starts to take off, when in the wonderful situations you get this hyper-growth where, you know, growth y- year over year, you know, it's triple digits. It's just exploding. And then gradually, the law of the large numbers start to kick in, and maybe the 100% growth becomes 50% growth the next year, and then the law of large numbers continue to kick in, and it's 25%, and then it's 12 and a half percent. And so growth tends to decay over time, even in the best businesses. And so the job-

   2. SCSonal Chokshi2:18

      didn't you used to call it, like, gravity or something?

   3. JJJeff Jordan2:19

      I called it gravity.

   4. SCSonal Chokshi2:20

      Yeah.

   5. JJJeff Jordan2:20

      It just would... gets... comes down to earth. And then the job of the entrepreneur is to be looking years down the road and say, "Okay, at some point, growth in business A is going to stop, and so I wanna keep it going as long as I can," and there's a whole bunch of tactics to do that. But then the other strategy is, "Okay, I need new layers on the cake of growth." At eBay, the original business was an auction business in the US, and so, you know, some of the things we layered on early are we layered on fixed price in the US. Not revolutionary, but it really did increment growth. Then we went international, and then we layered in payment integration. And each time we did that, the total growth of the company would actually accelerate, which is very hard to do at scale.

   6. SCSonal Chokshi2:59

      That's the whole point. Like, there's intentionality to it. It's not an accident-

   7. JJJeff Jordan3:02

      It's not an accident

   8. SCSonal Chokshi3:02

      ... that you guys introduce new businesses, new layers on the cake.

   9. JJJeff Jordan3:05

      Businesses don't grow themselves. The entrepreneur has to grow them. And, you know, occasionally you stumble into a business that seems to almost grow itself, but there just aren't many of those in the world, and that growth almost never persists for long periods of time unless the entrepreneur can figure out how to continue to drive it.

   10. SCSonal Chokshi3:22

       I remember a post you wrote actually a few years ago on the oh, shit moment when growth stops, 'cause people are a little blindsided by it.

   11. JJJeff Jordan3:28

       And that's the flip side of it. You know, y- early on you get this great growth. You have to keep it going. When it stops, your strategic options have been constrained dramatically.

   12. ACAndrew Chen3:37

       A lot of times when you're looking at what seemingly is an exponential growth curve, in fact, it's really something like, oh, you're opening in a bunch of new markets, right? So there's sort of a linear line there, but then you're also introducing products at the same time, and you're also reducing friction in, you know, signups or retention or whatever. And so the whole combination of those things is really kind of like a whole series of accelerating pieces that looks like it's, you know, this amazing viral growth curve, but it's actually, like, so much work underneath-

   13. SCSonal Chokshi4:06

       Right

   14. ACAndrew Chen4:06

       ... you know, that makes that happen.

   15. SCSonal Chokshi4:07

       I've also heard you talk about being able to distinguish what is specifically driving that growth so you don't have this exponential-looking curve without knowing what the lever that you're pulling to make that happen or knowing what's happening even if it's kinda happening naturally or organically.

3. 4:21 – 6:12

   Why Aggregate Metrics Hide the Levers

   1. SCSonal Chokshi4:21

      Can we break down some of the key metrics that are often used in these discussions, including just what the definitions are, and then maybe just talk through how to think about them?

   2. ACAndrew Chen4:28

      Right. Yeah. When you look at a large aggregate number, like total monthly active users, right, or you're looking at, like-

   3. SCSonal Chokshi4:34

      MAUs

   4. ACAndrew Chen4:35

      ... yeah, MAUs, right, or you're looking at, you know, the GMV, like adding up all the transactions in your marketplace, right?

   5. SCSonal Chokshi4:41

      So gross merchandise value.

   6. ACAndrew Chen4:42

      Yep. And so when you look at something like that, and if it's going up or down, you kinda don't have the levers at that level to really understand what's really going on. You wanna go a couple levels even deeper. How many new customers are you adding? As you're growing more and more new customers, right, a bunch of things happen. If you're using paid advertising channels, things tend to get more expensive over time because, you know, your initial kind of, like, super, super excited core demographic of customers, they're gonna convert the best. And as you start reaching into, you know, different geographies, different kinds of demos, all of a sudden they're not gonna convert as well, right?

   7. SCSonal Chokshi5:18

      Just to pause on that for a quick moment, you're basically arguing that growth itself halts growth in that context.

   8. ACAndrew Chen5:23

      Right. Right, so the law of large numbers being that there's only a fixed number of humans on the planet. There's only a fixed number of people that are in your core demographic, right? Once you surpass a certain point, it's, it's not like it's, it falls off a cliff. It's just more gradual that the customer behavior really changes.

   9. SCSonal Chokshi5:37

      How do you determine what's what when you don't have product market fit? Sometimes aren't these metrics ways to figure that out, or is this all When you have product market fit, like is there a pre and a post difference between this?

   10. ACAndrew Chen5:49

       Very concretely, like you wanna understand how much of the acquisition is coming from, you know, purely organic, people discovering it, people talking to each other, as opposed to, you know, oftentimes you'll run into companies that have over fifty percent of their acquisition coming from paid marketing, and like that tells you something that you're, you know, needing to spend that much money to get people in the door.

   11. SCSonal Chokshi6:08

       So CAC, customer acquisition cost, that's what you're talking about when you talk about acquisition.

4. 6:12 – 7:28

   CAC, Blended CAC and the Danger of Blended Numbers

   1. JJJeff Jordan6:12

      CAC is what it costs to acquire a user. Blended CAC is what it costs to acquire a user on a paid basis plus then also what quote unquote "free users" you acquire. So if you're acquiring half your users through paid marketing, you're paying a hundred dollars to acquire a user, but half your users come in at zero, paid CAC's a hundred, blended CAC's fifty. I view blended CAC as a really dangerous number. Most of the best businesses in the internet age of technology haven't spent a ton on paid acquisition. And so one is, you know, you've got the first cut with is, okay, the truly magical businesses, you know, a lot of them aren't buying tons of users. Amazon's key marketing right now is free shipping. And then, uh, the economics of paid acquisition tend to degrade over time, um, you know, as it grows, and as you try to scale it, and, you know, largely you're cherry-picking the best users, and then you're trying to also scale the number you get to grow. You know, I need twice as many new users this year as last year, and you typically pay more. So that magical LTV to CAC ratio, which early on says, "Oh, we're three to one," you know, in two years it'll probably be one and a half to one if you're lucky or something like that. So we typically do try to look for these other sources of acquisition, be it viral, be it some other form of non-paid.

5. 7:28 – 9:57

   Defining LTV and the LTV to CAC Ratio

   1. SCSonal Chokshi7:28

      Wanna quickly define LTV. That's lifetime value of the customer, but what does that mean?

   2. JJJeff Jordan7:33

      When you're shown an LTV to CAC ratio, you have no idea what you're seeing, essentially, given all the potential variations of the numbers. So we will almost always go for clarity. LTV, lifetime value, should be the profits, the contribution from that user after all direct costs.

   3. SCSonal Chokshi7:50

      How do we define the LTV to CAC ratio? What do the two of them in conjunction mean?

   4. JJJeff Jordan7:54

      Let's break them down. LTV is lifetime value. What you're striving to there is the incremental profit contribution for a user over the projected life of that user. So not revenue per CAC 'cause that, you know, typically there's costs associated to user. What's the incremental contribution that user brought from that incremental-

   5. SCSonal Chokshi8:12

      And that you mean the user brought to your company's-

   6. JJJeff Jordan8:14

      To the company, yes

   7. SCSonal Chokshi8:15

      ... value. So it's the value of your customer-

   8. JJJeff Jordan8:17

      Yeah

   9. SCSonal Chokshi8:17

      ... to the bottom line?

   10. JJJeff Jordan8:18

       It's the value of each customer to the bottom line, and then you compare that to the CAC or cost of acquired customer to understand the leverage you have between what I need to spend to acquire a customer and how much they're worth. If your CAC is higher than your LTV, you're sunk because it's costing you more to acquire a user-

   11. SCSonal Chokshi8:35

       Oh, than the value you get out of it

   12. JJJeff Jordan8:36

       ... than the value you get out of the user.

   13. SCSonal Chokshi8:37

       Yeah.

   14. JJJeff Jordan8:38

       If it's the opposite, at least you're in the game. I get more profit out of the user than I get cost to acquire that user. And then there's these dynamics on how does it scale over time. CAC tends to go up, LTV tends to go down because on the CAC side you're acquiring the less interested users over time, so they cost more to acquire and they're worth less. And so that LTV to CAC ratio, in our experience, almost always degrades as over time with scale. And so, you know, when you're in that conversation, you're in a very specific conversation of, okay, how much room do you have? How is it gonna scale? You know, what's gonna impact your CAC, like competitive things? So there has to be a lot... You know, it has to be like ten to kind of get you over that concern that, oh my goodness, those two are so close that you have no margin for error.

   15. SCSonal Chokshi9:29

       Right. This also goes back to the big picture of the layers on the cake because if you have other layers, you don't have to only worry about one layer's CAC to LTV ratio.

   16. JJJeff Jordan9:36

       It really does affect the calculation. If it's I'm in a new business and I have a whole different CAC versus LTV ratio, then that's a different conversation as well.

   17. SCSonal Chokshi9:45

       And the big picture there is that if you don't know the difference of what's doing what when, you might get very mistaken signals, mixed signals about your business. And so you guys don't want blended CAC because you wanna know what's driving the growth.

6. 9:57 – 11:17

   Blended CAC Revisited and the OpenTable Growth Hack

   1. ACAndrew Chen9:57

      I think what blended CAC gives you is it gives you a sense for, at this particular moment in time, you know, what's happening. The challenge is that when it comes to paid marketing in particular, it's easy to just add way more budget and to scale that than it is to scale organic or to scale SEO. Blended CAC is giving you a snapshot, but then as you're trying to scale the business, you're trying to increase everything by a hundred percent over the next... You're trying to double everything. Then all of a sudden, you know, your blended CAC starts to approach whatever your dominant channel actually looks like. And so if you're spending a bunch of money, then it'll just approach whatever is your, you know, paid marketing CAC. What entrepreneurs should think about is what is the unique ... organic new thing that's gonna get it in front of people without spending a bunch of money, right?

   2. JJJeff Jordan10:42

      A lot of the best businesses have this very interesting... I'll call it a growth hack. I mean, OpenTable, when I was managing it, did not pay any money at all to acquire consumers. You're like, "How can you do that?" They, you know... We had millions of consumers. The restaurants would market OpenTable on our behalf.

   3. SCSonal Chokshi10:58

      Right.

   4. JJJeff Jordan10:58

      You'd go to the Slanted Door website, back when they were an OpenTable customer, and you'd see, you know, you're looking... You go there to try to g- get the phone number to make a reservation. You say, "Oh, make an online reservation," and we then got paid to acquire that user. But that hack was a wonderful thing that scaled with the business and got us tons of free users.

7. 11:17 – 13:47

   Network Effects and Virality in the Physical World

   1. SCSonal Chokshi11:17

      To be fair, and this is another definition we should tease apart really quickly before we move on to more metrics, that also had the quality of network effects, which we've talked a lot about, in terms of these things growing more valuable the more people that use it. Is that growth? What's the difference there?

   2. JJJeff Jordan11:30

      Well, the business grew into the network effect. The key tactic to build the network effect was that free acquisition of consumers, that the more restaurants we had, the more attractive it was to consumers. The more consumers who came, the more attractive it was to restaurants. So there is a wicked network effect that came up.

   3. SCSonal Chokshi11:48

      Like a flywheel effect, right

   4. JJJeff Jordan11:49

      ... but just if you're not spending anything on paid acquisition of consumers, how do you start it? And the placements that OpenTable got in the restaurant, both physically in the restaurant, but particularly on the restaurant's website, was the key engine that s- got the network effect started. You had to manually sell some restaurants, come for the tool, stay for the network. But then once the consumers got enough of a selection and started to use it, it was game over.

   5. SCSonal Chokshi12:12

      Right. That was one way of going, getting around the bootstrapping or the chicken egg problem in seeding a network.

   6. ACAndrew Chen12:17

      Network effects have... There's a lot of really positive things about them, and one of the big pieces is that virality is a form of something that you get with a network. You know, the larger your network is, the more surface area, the more opportunities you have in order to encounter it, right? And so, you know, in the case of, you know, Uber, where I was recently, you know, by seeing all the cars with, you know, the Uber logo-

   7. SCSonal Chokshi12:39

      Mm-hmm

   8. ACAndrew Chen12:39

      ... those are all opportunities to be like, "Oh, what is this app? I should try it out." And so it's mutually reinforcing. Then you get more riders, and then you get more drivers that are into it. And so, you know, I think all of that kind of plays together.

   9. JJJeff Jordan12:49

      I'd bring two examples up. The pink Lyft mustache when they first-

   10. SCSonal Chokshi12:52

       I remember that

   11. JJJeff Jordan12:52

       ... got to San Francisco, you'd see it once on a car, and you'd go, "Huh, that's pretty weird." You see it twice on a car, and you say, "Something's going on here that I don't know about, and I have to understand what it is." Lime's the same kinda thing.

   12. SCSonal Chokshi13:05

       Right.

   13. JJJeff Jordan13:06

       They're bright green, and they glow essentially.

   14. SCSonal Chokshi13:09

       Yes, right.

   15. JJJeff Jordan13:09

       So when someone sees-

   16. SCSonal Chokshi13:10

       It's very distinct

   17. JJJeff Jordan13:10

       ... one in the wild, someone bolts by them in a glowing green-

   18. SCSonal Chokshi13:14

       Right

   19. JJJeff Jordan13:14

       ... electric scooter, and you're just like, "Okay, what is that?"

   20. SCSonal Chokshi13:17

       Right.

   21. JJJeff Jordan13:17

       And Lime hasn't spent a penny on consumer acquisition-

   22. SCSonal Chokshi13:20

       Right

   23. JJJeff Jordan13:20

       ... because, you know, their, their model is such that that physical cue in the real world leads to it.

   24. ACAndrew Chen13:26

       The other one I'll throw in as well is within workplaces, you know, enterprise products, there's a lot of kind of bottoms-up virality that comes out of people, you know, kind of-

   25. SCSonal Chokshi13:34

       Like at Slack

   26. ACAndrew Chen13:35

       ... sharing and collaborating. Yeah, like for example, Slack is a great, you know-

   27. SCSonal Chokshi13:38

       Yeah

   28. ACAndrew Chen13:38

       ... ex- example of this. And so these are all kind of really unique ways that you can get acquisition for free, and so then your CAC is, you know, quote-unquote, "zero"-

   29. SCSonal Chokshi13:46

       Yeah

   30. ACAndrew Chen13:46

       ... as a result.

8. 13:47 – 15:33

   When Paid Marketing Works and When It Becomes a Trap

   1. SCSonal Chokshi13:47

      You guys have talked a lot about organic. It makes it sound to me, as a layperson, that you don't want paid marketing. What's your views on this? Like, is it a bad thing? Is it a good thing? I don't mean to moralize it, but help me unpack more where it's helpful and where it's not. Are there any rules of thumb to use there?

   2. JJJeff Jordan14:02

      I mean, there've been s- a lot of great businesses that have leveraged paid marketing. I mean, the OTA sites, The Online-

   3. SCSonal Chokshi14:07

      Right

   4. JJJeff Jordan14:07

      ... Travel Agency.

   5. SCSonal Chokshi14:08

      Right.

   6. JJJeff Jordan14:08

      Priceline and Expedia s- just spends, you know... They spend the GDP of many large countries in the acquisition. And then it's often a tactic in some good businesses, but if it's your primary engine, a couple things happen. One is the acquisition economics tend to degrade over time for the reason we're saying.

   7. SCSonal Chokshi14:24

      Right. This is you guys' point about... Right.

   8. JJJeff Jordan14:26

      And it leaves you wide open to competition. If you-

   9. SCSonal Chokshi14:28

      It gets commoditized very quickly

   10. JJJeff Jordan14:29

       ... need to buy users, I mean, if you're selling, you know, the new breed of mattress and you need to buy users, and early on you're the only person competing for that word, flash forward a year or two, there are like six new age man- manufacturers with virtually identical products competing for the same consumer. The economics are not going to persist over time. And so, you know, one of the key questions in businesses driven by heavy user acquisition is kinda how does the play end? You know, it, it usually looks pretty good at the beginning of the play, but in the middle it starts getting a little complex.

   11. SCSonal Chokshi15:00

       There's a little area

   12. JJJeff Jordan15:00

       And then, and then there's tragedies at the end.

   13. SCSonal Chokshi15:02

       Right.

   14. ACAndrew Chen15:02

       And I think if it is something that you're using in conjunction with a bunch of other channels and you're kind of accelerating things, that can be great. For example, when Facebook in the past has broken into new markets, they'll start with paid, you know, marketing to kinda get it going. And so in a case like that, really paid marketing is a tactic to kinda get a network effect jump-started.

   15. SCSonal Chokshi15:21

       Gotcha.

   16. ACAndrew Chen15:21

       Right? And then you can kinda, like, pull off from that-

   17. SCSonal Chokshi15:23

       Right

   18. ACAndrew Chen15:23

       ... if you'd like. But if you're super, super dependent on it and you don't have a plan for a world that all the channels are gonna degrade, then you're gonna be in a tough spot-

   19. SCSonal Chokshi15:32

       Totally

   20. ACAndrew Chen15:32

       ... within a couple years.

9. 15:33 – 18:00

   How Much Paid Is Too Much: Discipline, Sectors and Platform Risk

   1. SCSonal Chokshi15:33

      Do you have a sort of heuristic for when to stop the paid? Is there, like, a tipping point to know this is when you move?

   2. ACAndrew Chen15:38

      I think in terms of how much paid should you do as part of your portfolio, I think that's the right way to think of it, is it's one out of a bunch of different channels, right? And so I would argue the following. So first is you really have to measure the CAC and the LTV and be super disciplined about not spending ahead of where you want it to be and not to do it on some, you know, blended number that doesn't make any sense.

   3. SCSonal Chokshi15:58

      Right.

   4. ACAndrew Chen15:59

      And then I think the other part is you really want it to be a small enough minority of your channels such that if you were to get to a point where it turns out to be capped, that you're okay, that you can live with that.

   5. SCSonal Chokshi16:09

      Your business will survive and-

   6. ACAndrew Chen16:10

      Right

   7. SCSonal Chokshi16:10

      ... continue to grow-

   8. ACAndrew Chen16:10

      Exactly

   9. SCSonal Chokshi16:10

      ... and be healthy.

   10. ACAndrew Chen16:10

       You can still get the growth rates you want, and you can still... You have such strong product market fit-

   11. SCSonal Chokshi16:14

       Right

   12. ACAndrew Chen16:14

       ... that you're able to maintain that.

   13. JJJeff Jordan16:16

       Take a couple sector examples. You know, e-commerce, a lot of companies struggle with, "Okay, how do I get organic e-commerce traffic?" So most e-commerce companies rely heavily on paid user acquisition. You know, typically one of the interesting things is they degrade over time, and they're all competing for the same user. It's hard for e-commerce companies in most segments to be profitable, and you'd look at the same kinda dynamic in meal kits, in, you know, restaurant delivery. You know, if you can't differentiate yourself and you're highly reliant on paid marketing- The movie typically doesn't end really great, and so we look for segments where there's a balance or they've come up with that really unique growth hack, and they're not then reliant on paid channels. And then by the way, paid channels can degrade, too. I mean, when, uh, I made a couple investment mistakes where the a- paid acquisition looked really good, and then actually what they were doing are they were arbitraging something like Facebook's early mobile attempts, where the people who participate in Facebook mobile ads early got real deals. They were nowhere near kind of the price they should've been trading at. So you're like, "Man, look at these user economics. They're awesome." And then Facebook, you know, kinda got to equilibrium when supply and demand met, and the cost went up multiples, and those businesses that looked so good early just, you know, g- got incredibly stressed because the mon- you know, they, they had no alternative to that, that inflation.

   14. SCSonal Chokshi17:37

       That's a case of platform risk, where you're dependent on the channel of, on Facebook mobile or whatever the specific channel was there. But Andrew, you were also earlier talking about just a cap on how much is possible. You both referenced the fact that things can become very competitive, that your competitors can also buy the same channels, and then it gets very crowded or very expensive. So there's multiple layers of the risk of the paid is what I'm hearing, but you have to be aware of that.

10. 18:00 – 20:12

    Riding Trends: Shareable Products and Creative Acquisition

    1. ACAndrew Chen18:00

       Yeah, so I think on the acquisition side today, there's a couple really interesting opportunities that might be, you know, temporal, right? And it, it may go away, right? But for example, I think that if you have a product that is very highly visual, and I think this is, you know, one of the reasons why esports has gotten, you know, so huge, is because you have a product that naturally generates a ton of video in a age which all the platforms are trying to rush to video.

    2. SCSonal Chokshi18:25

       Oh, that's fascinating.

    3. ACAndrew Chen18:25

       Right?

    4. SCSonal Chokshi18:25

       Yes.

    5. ACAndrew Chen18:25

       And so, you know, maybe this'll be less of an opportunity coming up, but, like, you know, that's, that, that's a thing.

    6. SCSonal Chokshi18:29

       Wait, why would you say that's temporal? Because-

    7. ACAndrew Chen18:31

       Because the com-

    8. SCSonal Chokshi18:31

       ... seems like-

    9. ACAndrew Chen18:31

       ... the competition will, will-

    10. SCSonal Chokshi18:32

        Do the same thing

    11. ACAndrew Chen18:33

        ... yeah, will do the same thing, right?

    12. SCSonal Chokshi18:34

        Ah, great.

    13. ACAndrew Chen18:34

        Like, I think we're now gonna move to a thing where, like, all of these different kinda software experiences all are incredibly shareable. Like, there's no point these days in building a new game that doesn't have built-in recording and publishing to Twitch-

    14. SCSonal Chokshi18:47

        Yeah

    15. ACAndrew Chen18:47

        ... and built-in tournament systems and a- all the community features and all that stuff that you need. And you know, I think it used to be that you would think of a game as just the actual IP, but in fact, it's sort of these layers and layers of social interaction and content around it. And I think that's both true as well as all of these different brick-and-mortar experiences that are making themselves highly Instagrammable. They're adding areas to where you actually stand there and pose.

    16. SCSonal Chokshi19:11

        Oh my God, my favorite story about this is the restaurants trend of making square plates and layouts so it really fit beautifully with Instagram. That's one of my favorite things in the world is when the physical world adapts to the digital.

    17. ACAndrew Chen19:22

        And then you can go the other way, too, right? Which is physical products like scooters that remind you to engage digitally. The other, you know, one fun example I always like is everyone's had the experience now where they're just, like, in a room talking, and then their, you know, Amazon Echo just turns on and is trying to go. And I'm like, you know, they have no incentive to fix that-

    18. SCSonal Chokshi19:41

        Yeah

    19. ACAndrew Chen19:41

        ... because, like, it reminds you that it's there and reminds you to talk to it. I think the big takeaway here is that you have to really be creative and really be on the edge of what everyone's doing, right? And so if it turns out that everyone's really into video and they're really into Instagram right now, you have to think about, like, how does my product actually fit into-

    20. SCSonal Chokshi20:00

        Yeah

    21. ACAndrew Chen20:00

        ... that trend?

    22. SCSonal Chokshi20:01

        Yeah.

    23. ACAndrew Chen20:01

        And if you can find it, then you can get an amazing killer way to get jump-started. And, and if the trend lasts, then great. Accelerate it with paid marketing, accelerate it with PR, do all that stuff to kinda keep it going.

11. 20:12 – 20:31

    Wrapping Up Acquisition and Teeing Up Engagement

    1. ACAndrew Chen20:12

       I wanna make the distinction that we're mostly talking about growth and acquisition.

    2. SCSonal Chokshi20:16

       Yes.

    3. ACAndrew Chen20:16

       And that is what startups mostly care about in the early days because you don't, you don't really have any active users, right? But the other part of this is that you see all the users who show up and how active they are starts to change over time.

    4. SCSonal Chokshi20:28

       The engagement. Well, thank you guys for joining the a16z Podcast.

Episode duration: 20:31