Moneyball & Growth Hacking

Loved the book. Loved the movie. Loved Moneyball for Startups.

Love the concept, and how it relates to value investing.

Lately, I’ve been thinking how Moneyball applies to growth hacking as well.

Billy Beane got Oakland Athletics, a baseball team with no money, and used whatever little budget he had to buy undervalued players who traditional scouting methods didn’t/couldn’t value.

Similarly, in most startups, you don’t really have much of a growth/marketing budget. All you have is a product you believe in; something you think will click with the users, once they experience it. So once you nail down distribution, that coupled with a great product should be good enough to propel you to critical mass, and become the next Facebook.

The only problem with that is distribution is very hard to get right.

“Distribution is the biggest problem faced by every product/startup” – Peter Thiel

Chances are, there will be at least 10 competitors in the space already, most of them with deeper pockets, access to better distribution channels and 10 times the marketing budgets that you have.

If you do the traditional thing — things that’ve worked in the past, things which everyone already knows about — you’ve already lost the game before you even started playing. So instead of playing the game, you change it entirely and try to dominate it before anyone else has a clue what’s happening, and by the time they do, you’ve hopefully already beaten them at it.

What you need is just a few big wins to achieve massive growth, engage the users with an awesome product, and once you hit that critical mass, the inherent virality of the app triggers a self perpetuating growth cycle. (At least for any social app with a viral component.)

“If you cannot outspend them, outsmart them.”

That’s really what growth hacking is all about. Finding under explored channels for distribution, exploiting them as much as you can, before the world catches on and everyone starts doing it.

Take the example of the Oakland Athletics — once other teams caught on to what they were doing right and started investing in sabermetrics, they lost their edge and went back to the bottom of the table.

So once you experiment with a new distribution channel, and it seems to be working, go all out, make a big bet, and try to milk it completely before others catch on. Once it’s out in the open, keep at it until the cost of acquiring new users make sense, but in most cases, your competition will flood the channel and drive up costs. That’s when you ditch that channel, let your competition slug it out, and move on to make your next big bet — on something new.

If you get even a couple of these big distribution bets right and have a great product, you’ll have navigated your way to product-market fit, your next round of funding, and possibly critical mass, all of which increase your chances of winning your space by an order of magnitude.

At hike, we’re doing the same. We’re in a highly competitive space with almost all competitors having a few years on us, millions of users, and much deeper pockets.

In the last couple months, we’ve made some big bets, which have worked quite well for us. We recently hit 5M users in just 4 months, to become the fastest growing Indian startup. We’re gearing up to take it to the next level; make more big, audacious bets on completely new distribution channels. If any of those work, we’ll be one of the biggest players in our space soon.

2012: The Year That Was

2012 was roughly the 24th year of my life. Not my best, but a very eventful one nevertheless.

A boring start…

It’d been more than a year since I graduated from college in late 2010. Almost six months since I left that “stable” job at DoucheBigCo #1 and narrowly escaped the “MBA” clusterfuck to join a startup. Moved to Delhi. Delhi has been good. A bit boring though.

Things get exciting…

Did some awesome work at Startup #1. Led the team in India. Had fun. Realized how screwed up the education scene in India is when we started hiring. Glad about recent life choices. Made some decent money through bonuses, freelancing and doing random shit. Fuck-you money levels reach 0.27%.

Shit happens…

Had to appear for the CFA L2 exam. Didn’t really care. Had a bout of jaundice. Didn’t give a shit about that either. Mostly bored. Realized priorities in life.

Shift in focus. Asked out a really awesome, cute and intelligent girl that I liked a lot. Worked on that. Brief signs of hope and happiness. Didn’t work out in the end. Worth it though. Trough of sorrow.

It’s funny how many parallels can be drawn between startups and life.

Gotye’s Somebody That I Used To Know on continuous loop for a week. Got over it. Reconnected with a lot of old friends. Re-evaluation of life choices.

Screw it, let’s do it?

Time to work on my own startup. Quit Startup #1.

Idea in place. Vision in place.

Time to become a billionaire. Time for world domination. Time to get back in the game. Time to nut up or shut the fuck up.

Avengers, assemble!

Didn’t work out. FUCK! Failed to assemble my A-team.

Startup life lesson: Finding the right team is tougher than trying to get Scarlett Johansson to date you.

Because however shitty your post is, having Scarlett Johansson’s picture always helps.

Tried joining an NGO. Argued about how they should go for scalable, big-impact stuff instead of the idealistic crap they do. Rejected. Tried joining a startup accelerator program. Shitty resume and track record, low experience, too early, too much competition. Rejected.

Trough of sorrow part deux.

Getting back…

Connected with some awesome people in the startup community. Discovered another startup planning to do something related to my big idea. Interview. Big pitch. Worked out.

New beginnings…

New role. Interesting work. Moved to Gurgaon. Met one of the greatest Indian entrepreneurs. Attended #NPC in India. Met some brilliant people. Further connected with the Indian startup community. Inspired.

First international vacation to Thailand with friends after years. Good times.

Cut to present…

Working on something awesome at Startup #2. Something massive. Time to go big or go home. You’ll know soon.

The way ahead…

If/when my current gig ends, I’ll have worked in every major area I’m interested in -technology, finance, growth, strategy, marketing, internet/mobile products etc.

In 2013, I’ll definitely start working on my big idea. One way or the other. In my own startup or someone else’s. Probably the latter. Hopefully the former.

2013 to-do:

  • Fuck-you money [unlock achievement]
  • Work on my idea/startup.
  • Travel more. India. World.
  • Read more. Movies less.
  • Music more. Internet less.
  • Experiences, not things.
  • Don’t get bored.

On Growth Hacking

Setting aside my plans for world domination temporarily, I’ve started working as a Growth Hacker at one of India’s leading consumer mobile app startups for a couple of months now. We’re working in the social messaging domain, and we hope to be one of the biggest “Made in India” success stories on the global internet/mobile product startup scene.

We are still an early stage startup, but you’ll be hearing about us a lot in the coming months. We’ll be launching soon, and I’ll be updating the blog again when we hit a million users. Just to gloat a bit, but more importantly, to share my experiences about growth hacking — trying to achieve hockey-stick hyper growth in a highly crowded space with not much more than a vastly superior product which blows away the competition and a few ideas (which I hope work out).

So what is growth hacking? In one word, it’s awesome. In a few more words, it’s one of the coolest things one can ever do. (Especially for quasi-megalomaniacal people who make plans for world domination when they’re bored. And this is coming from a guy who hates working for the most part.)

More on Growth Hacking:

Growth Hacker is the new VP Marketing

You Don’t Need a Growth Hacker

Defining A Growth Hacker: Three Common Characteristics

5 Ways Growth Hackers Changed Marketing

Growth Is Not A Marketing Strategy

But a million is not what I’m aiming for. Because a million users isn’t cool. You know what’s cool? A billion fucking users.

PS: Always wanted to use that line. It’s so awesome.

The PayPal Wars

The best book I’ve ever read. I’m not exaggerating. And trust me, I’ve read a lot of books.

If you’re an aspiring entrepreneur interested in startups, you absolutely need to read this book.

The PayPal Wars: Battles with eBay, the Media, the Mafia, and the Rest of Planet Earth

The PayPal Wars – Amazon | Flipkart

I have been a huge fan of the PayPal Mafia, and consider Peter Thiel and Elon Musk as my role models. PayPal is close to my heart, because if it didn’t exist, I wouldn’t be the man I am today. I’d never have been able to start my freelancing career or be an internet entrepreneur without PayPal enabling me to accept payments. Well, I probably would have figured out some other way, but it’d have been much tougher.

Anyway, nothing I can possibly say about the PayPal story can do justice to the complete fucking awesomeness of it. In a way, the PayPal Mafia completely revolutionized the startup scene in Silicon Valley, and played a huge part in making it what it is today.

The PayPal Wars is the story of some of the greatest geniuses coming together to build one of the most awesome startups in the world, which would change the way we transfer money using the internet, against all odds.

While you’re at it, also read this – Meet the PayPal Mafia

If I could be even 1% as smart as Peter Thiel and Elon Musk, I’d be a big fucking genius, and the same applies to you. Do the human race a favor. Be less stupid. Just read it.

Rise!

 

Advice to Graduating Engineers: Don’t Be a Drone

I have seen a lot of these posts going around, so I’m going to pitch in with my own advice. It’s been exactly 2 years since I graduated, so I have a fair idea of what the world after getting out of college feels like.

Don’t be a fucking drone.

By this, I mean never join any of the lame companies coming to your campus for bulk recruitment. This includes all IT sweatshops which offer the normal training-bench-mind-numbing-job routine, bulge bracket investment banks which work you like a dog for meager pay (which may seem high at first to some, but you’d eventually realize that it’s not worth it), and every other shitty company which pays like shit, and more importantly, robs you of some of your most productive years by forcing shitty work down your throat.

This is the worst way in which you could possibly start your professional life. You may not realize this then, but you will regret this when you turn 30 and have a mid-life crisis wondering why you aren’t filthy rich, why your wife isn’t insanely hot, why your job sucks and how your life didn’t quite turn out to be the way you imagined it would when you were a kid.

Steer away from the herd.

Don’t study further just because every other clueless idiot is doing it. I know idiots who have gone abroad for their Masters or MBA just because their friends were doing it and they wanted to have fun for a couple of years. If you do that, never take an educational loan for that, because it’s highly likely that you’ll end up asking “Would you like fries with that?” or work in some shitty job there just because you want to recover your investment. You might feel great when you convert your dollar salary to rupees, but ultimately, you’re still just a drone. If you have a rich Dad who is willing to splurge on your education, then by all means, do it. Better still, just go for a world trip and then come back and take over your family business. Cheaper, more fun and a better use of your time.

If you do an MBA just because you want to “get into finance” since you can’t code for shit, then you need to know that most post-MBA jobs are very fucking boring. And the interesting ones are so few that only a fraction of the top students at the top colleges will be able to get those. The chances are so low that it’s not worth studying like a dog to get a good CAT/GMAT score, and then again for two years to get good scores in your MBA tests. Rather just work at interesting startups in related profiles, and jump on to the job you want without studying further.

Start/Join a startup!

In your first couple of years after college, you probably aren’t going to make a shitload of money, so your opportunity cost is the lowest that it will ever be. This is the best time for you to experience the startup way, because you don’t really have much to lose. If you don’t have a great idea or team or aren’t sure that you can do it, then join one.

Read: Why I Quit My Job, Dropped My MBA Plans and Joined a Startup!

Start something, work on side projects, freelance and do whatever it takes to diversify your income sources, so you aren’t dependent on a job, and don’t lose much even if your startup fails.

If your startup takes off, you’ll get to the fuck-you-money point in a few years, and won’t ever need to work again just for money. You can then pursue something you’re really interested in — your passion — which improves the odds of success significantly.

If not, you’ll have learned a lot more than you’d have at any lame job at a BigCo, and you’ll easily be able to get back in a better role at a BigCo than your peers. But you won’t want to. Because once you’ve worked at a startup, you’ll never ever want to work at a BigCo again. You’ll want to build one from scratch.

Don’t be a fucking drone. Steer away from the herd. Startup!

PS: I know this seems rushed, but I’m too fucking bored to put any more effort into this. May update this later.