We’ve seen the list of value added services offered by VC grow from recruiting to PR to marketing and more. Growth hacking isn’t necessarily something that every VC is clamoring to offer, and there’s a lot of controversy around what growth hacking really is, who is good at it and how beneficial it is to companies. But Social+Capital Partnership, the VC firm founded by former Facebook exec Chamath Palihapitiya, is planting its stake in the ground with helping startups create and develop for optimal growth. Part of this is bringing on Ray Ko, who was previously an EIR at the firm, on as a permanent operational partner, with the title of Growth Partner.
Ko was formerly the director of growth and analytics at Facebook, and worked under Palihapitiya, so he knows a thing or two about growth, and product development. When he joined Social+Capital Partnership as an EIR last year, part of his time was spent advising companies, like education messaging app Remind 101, on making tweaks to the product to scale userbase and engagement.
Remind 101, and others, benefitted from Ko’s help that the firm decided to make him a partner that is focused exclusively on teaching startups the discipline and framework for optimizing growth. “It’s about getting these teams to think about growth in a meaningful way,” says Ko. He explains further that his primary goal is teaching companies how to stay committed to a way of thinking around growth, and having implement that process on their own.
Social+Capital Partnership and Ko make it clear that growth comes down to the product, and data, and how to create a service that helps and delights customers and users. It’s about creating real growth for startups, not just a temporary jump that can help boost a valuation for the next round of funding.
He also cautions that his and the firm’s views are that growth isn’t necessarily just about getting users or viral growth. “It’s not just about getting user numbers up and to the right…growth can be around driving friending, or any interaction that is correlated with engagement for a service,” he says. Another area where Ko is working with startups is around data analysis, and helping read and use the data to understand and then execute ways to grow engagement.
For Remind 101, there were a lot of little changes that Ko helped the team implement. Some were as small as creating a loading spinner at the bottom of a page, but others involved tightening the feed back loop and sign up process to activate users. In particular, Remind 101 changed the sign up process for teachers so that instead of going straight to the product, teachers engaged in a walkthrough of the dashboard for better clarity.
Within two months of Ko working with the team, Remind 101 was able to double its user base, and now has ten million users.
For Ko, this new, permanent role involved working with five to 6 companies a week, to impart values and a process that can not only drive growth, but sustain growth. He’s currently working with a number of Social+Capital Partnership’s portfolio companies including Brilliant and CreativeLive.
It’s definitely not common for VC firms to employ talent that focuses purely on growth. But a few firms in Silicon Valley have placed focus on this. Ooga Labs focuses primarily on helping startups create growth and network effects. 500 Startups is also helping its portfolio around growth. Greylock brought on former Twitter, Facebook and Quora alum Andy Johns, as Growth Strategist in Residence last year. Johns is now the director of growth and revenue at Wealthfront. Greylock partner Josh Elman has also been helping portfolio companies with growth and engagement, including Nextdoor.
Outsourcing growth to a VC firm, the way one might with PR strategy, is probably the wrong move. The best way for growth execs in VC firms to add value is to teach the practice and framework around their experiences adding growth, and allowing the startups to learn and implement these skills and tools themselves. It’s similar to the way that Google Ventures teaches its portfolio design skills via sprints.
It’s still early to see the long-term benefits of having a growth expert within a VC firm. Much will come down to whether these startups who are being taught can sustain growth, and use the education to create engagement in other parts of their business and applications.