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Data for Growth
Ekaterina Skorobogatova
VP Growth
TheVentureCity
 Offices in Miami and Madrid, teams in San Francisco and
in Sao Paulo
 $100M VC Fund
 Emerging hubs accelerator
 Silicon Valley methodology
 Founder-centric
 Data-driven
 Education
 Established companies
 8 years at Facebook in a variety of growth roles at FB,
Instagram, WhatsApp
 Last three years working on WhatsApp analytics
 Now: helping companies grow
 Love Brazil!
Agenda
Components of active user growth
Quick ratio
Growth-retention matrix
Why retention is important for growth
Bend the curve!
Aha! Moment and how to discover it
Definition of Active
 User takes some meaningful action of value to the
company
 Avoid vanity metrics
 Examples:
 Purchases
 Posts
 Referrals
 App opens
 Games played
Example: 20% Month-over-Month Growth
Quick Ratio: Focus on Growth Components
Growth Components: Churn & New/Resurrected
Three 20% MoM Growth Scenarios
A B C
Minimal churn
makes growth so
much easier!
Quick ratio and retention
Quick ratio and retention
<1 = Shrinking
>1 = Growing
1.5 = average for a consumer company
4.0 = benchmark for SaaS subscription revenue
What is your quick ratio?
Interpreting the Quick Ratio
Quick ratio and retention
High Retention + Low Growth:
Focus on acquiring more
customers; the ones you do have
are loyal
High Retention + Low Growth:
Focus on acquiring more
customers; the ones you do have
are loyal
Low Retention + High Growth:
Focus on retaining users to make more
efficient use of marketing dollars
High Retention + Low Growth:
Focus on acquiring more
customers; the ones you do have
are loyal
Low Retention + High Growth:
Focus on retaining users to make more
efficient use of marketing dollars
Low Retention + Low Growth:
Lots of work to do on both
user acquisition and retention
High Retention + Low Growth:
Focus on acquiring more
customers; the ones you do have
are loyal
High Retention + High Growth:
TheVentureCity would like to
schedule a convenient time to talk
Low Retention + High Growth:
Focus on retaining users to make more
efficient use of marketing dollars
Low Retention + Low Growth:
Lots of work to do on both
user acquisition and retention
Why Retention is Important to Growth
 If you are not keeping your existing users, acquiring new
users fills a leaky bucket
 You might grow based on new users for a while, but
eventually you will use up all possible acquisitions
 User numbers will plateau, then decline
 Then youre dead
Cohort User Retention Curve
Source: TVC internal data
Cohort User Retention Curve
Source: TVC internal data
Retention Curves
Source: Popcorn Metrics
Customer Churn in Native Mobile Apps
Retained
Churned
Source: Andrew Chen / Quettra
Aha! Moments
An Aha! Moment is when a user figures out the value of a service
for herself
Aha! Moments lead to engagement
Engagement leads to retention
Retention leads to growth
Sample Aha! Moments
Day 1 retention
7 friends in 10
Days
30 Follows
One file in one
folder
Source: GrowHack
Dropbox Onboarding
Source: Groove
Discovering Your Aha! Moment
 Look at initial user behaviour, such as Week 1
 Focus on one of these categories for units of value:
 Network density (friends or connections)
 Content added (posts)
 Visit frequency (visits and specific events)
 Purchases
 Compare customer cohorts that retained AFTER WEEK 1 with cohorts
that did not engage
 It may not be a single moment, but a set of actions that separate
those who find value from those who dont
Key Take-Aways
 Retention is the most important ingredient of growth
 Best time to promote retention is in the first seven days
 Use data to understand what actions/usage patterns lead to retention
 Study what the retained users engaged with in the first seven days to
learn what immediate value they found in the service
 Aha! Moment analysis can help drive product roadmap prioritization
Final Thought
Founder of Mixpanel
For More On Data for Growth
Medium @TheVentureCity
@Katka_s
The Venture City in Brazil
ricardo@theventure.city
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Quick ratio and retention

  • 1. Data for Growth Ekaterina Skorobogatova VP Growth
  • 2. TheVentureCity Offices in Miami and Madrid, teams in San Francisco and in Sao Paulo $100M VC Fund Emerging hubs accelerator Silicon Valley methodology Founder-centric Data-driven Education Established companies
  • 3. 8 years at Facebook in a variety of growth roles at FB, Instagram, WhatsApp Last three years working on WhatsApp analytics Now: helping companies grow Love Brazil!
  • 4. Agenda Components of active user growth Quick ratio Growth-retention matrix Why retention is important for growth Bend the curve! Aha! Moment and how to discover it
  • 5. Definition of Active User takes some meaningful action of value to the company Avoid vanity metrics Examples: Purchases Posts Referrals App opens Games played
  • 7. Quick Ratio: Focus on Growth Components
  • 8. Growth Components: Churn & New/Resurrected
  • 9. Three 20% MoM Growth Scenarios A B C Minimal churn makes growth so much easier!
  • 12. <1 = Shrinking >1 = Growing 1.5 = average for a consumer company 4.0 = benchmark for SaaS subscription revenue What is your quick ratio? Interpreting the Quick Ratio
  • 14. High Retention + Low Growth: Focus on acquiring more customers; the ones you do have are loyal
  • 15. High Retention + Low Growth: Focus on acquiring more customers; the ones you do have are loyal Low Retention + High Growth: Focus on retaining users to make more efficient use of marketing dollars
  • 16. High Retention + Low Growth: Focus on acquiring more customers; the ones you do have are loyal Low Retention + High Growth: Focus on retaining users to make more efficient use of marketing dollars Low Retention + Low Growth: Lots of work to do on both user acquisition and retention
  • 17. High Retention + Low Growth: Focus on acquiring more customers; the ones you do have are loyal High Retention + High Growth: TheVentureCity would like to schedule a convenient time to talk Low Retention + High Growth: Focus on retaining users to make more efficient use of marketing dollars Low Retention + Low Growth: Lots of work to do on both user acquisition and retention
  • 18. Why Retention is Important to Growth If you are not keeping your existing users, acquiring new users fills a leaky bucket You might grow based on new users for a while, but eventually you will use up all possible acquisitions User numbers will plateau, then decline Then youre dead
  • 19. Cohort User Retention Curve Source: TVC internal data
  • 20. Cohort User Retention Curve Source: TVC internal data
  • 22. Customer Churn in Native Mobile Apps Retained Churned Source: Andrew Chen / Quettra
  • 23. Aha! Moments An Aha! Moment is when a user figures out the value of a service for herself Aha! Moments lead to engagement Engagement leads to retention Retention leads to growth
  • 24. Sample Aha! Moments Day 1 retention 7 friends in 10 Days 30 Follows One file in one folder Source: GrowHack
  • 26. Discovering Your Aha! Moment Look at initial user behaviour, such as Week 1 Focus on one of these categories for units of value: Network density (friends or connections) Content added (posts) Visit frequency (visits and specific events) Purchases Compare customer cohorts that retained AFTER WEEK 1 with cohorts that did not engage It may not be a single moment, but a set of actions that separate those who find value from those who dont
  • 27. Key Take-Aways Retention is the most important ingredient of growth Best time to promote retention is in the first seven days Use data to understand what actions/usage patterns lead to retention Study what the retained users engaged with in the first seven days to learn what immediate value they found in the service Aha! Moment analysis can help drive product roadmap prioritization
  • 29. For More On Data for Growth Medium @TheVentureCity @Katka_s The Venture City in Brazil ricardo@theventure.city