Product-led Growth | Hacker News Reader

Product-led Growth

posthog.com

31 pointsyakkomajuri24 comments

Wow, do not take this advice. This must have been written by someone with little to no skin in the game. I'm honestly surprised someone would post this.

The idea that a good product will sell itself is a developer's fantasy. Trust me, I've been there and learned the hard way. Once I realized that sales and marketing were the missing pieces, I began to build revenue and I'm well past my first 1M. It only came after I made that change.

Every startup should focus on its inbound and outbound strategies.

Inbound Marketing: Publish great content (blog posts, white papers, videos, resources, things people will find genuinely useful) on your site and across the web on topics related to your service so that users find you. Put the most compelling resources behind a lead form that helps you qualify them as potential buyers. This gets the user acquainted with you and also gives you their contact info for follow up marketing or sales contacts.

Outbound Sales: Reaching out directly to the leads you have acquired (best quality) or off some other list (lower, variable quality). Sometimes the contact will be happy to engage and learn more. Other times not.

You can and will win sales from the inbound piece alone, especially if you have a clear and efficient sign up process. But you'll find you can greatly amplify the number of closed sales by reaching out to users and engaging them directly. That human touch adds a whole new element.

There are many facets of sales and merketing but I wanted to lay out the most important items, since taking the post's advice will almost definitely point you in the wrong direction.

Absolutely spot on. I made the mistake mentioned in this blog post earlier and I wish I had focused on inbound and outbound marketing earlier.

"Building a Great Product" is the number one reason startups fail. There is nothing wrong with building a great product. However, if no one wants to buy your great product or if it costs a ton of money to get people's attention for long enough for them to understand how great your product is, then you will not be profitable.

I guess this is just semantics but can you really say a product is great if no one wants to buy it and it doesn't get people's attention?

If you look at product ratings you'll see that there are some products which get great ratings but those companies are not successful long term financially, and other products which get medium reviews but come from companies which are very profitable.

We’ve got to 2M YRR with pretty much no sales and no marketing. We do talk to customers but only when they initiate contact. We’re B2B though and the value we provide can be easily communicated in five words.

Go on...

Basically we built a product that didn’t exist, but knew our industry would want, so people started talking about us as they found out. And those people really wanted us to succeed which turned into early sales which allowed us to fund development of the product.

We didn’t spend many resources on sales or marketing because we knew those resources would be better spent on making a better product. For example I spent a weekend making a static single page website a few years ago but I’ve not logged into our google analytics account in at least over a year. Inquiries come in through the website regularly still.

I think we’re pretty close to product/market fit now, so we should get a much better return on sales/marketing efforts than we would have a couple years ago.

I guess you could say that we knew the product wasn’t good enough for the majority of our market but it was good enough for the early adopters who really needed it, and we did just enough to make sure those people could find us. I spent months of my life working with those early adopters to make sure they didn’t regret their choice, and that helped guide the development of the product as well as maintain goodwill in the community, which led to more word of mouth sales.

Anyway take my story with a grain of salt because we’re not successful yet.

Cannot agree more - I really don't understand the argument the post is trying to make.

At some point, you are doing sales, and you are doing marketing. Heck, even talking to a mate at another company and pitching them on what you're building falls under them.

If you're not thinking about distribution (even, and I wouldn't recommend it, as a sideline item), you're going to be essentially dead in the water.

The article calls out Facebook and Slack as examples of "Product-led Growth" as somehow serperate from Sales and Marketing. I think that's perhaps misrepresenting how their growth worked. Facebook didn't grow because it was just a very good social network that was better than competitors through sheer value, but its marketing and acquisition funnels were baked into the product (friends asking friends to join - some would see that as a product feature, some would see it as an engineered marketing feature).

The Tesla example is just a weird one - once again falling into the common trap of equating advertising with all marketing. You think Tesla wouldn't have spent on advertising had they not had one of the most PR-able men in the world at the helm?

This article is complete bullshit. It is based on the fact that they have been successful at growing a saas company without sales team

Well they sell to SMB [1], of course they don't need sales, no SMB focused company should have sales team. Try to sell SAP without sales people and write an article about it ;)

This article is also saying that having a good product will prevent your from needing a sales team, again this is false. The goal of a sales team is not to convince customers that they should by your product. A salesperson is here to listen to your needs and offer you something that match with that

If you are trying to start a company, please dont read this article

[1] https://posthog.com/pricing?o=cloud

Selling to any real enterprise that costs north of 100K is almost impossible without a sales team (account executives, sales engineers). A lot of account executives have relationships from their previous work and they get a meeting through that. Look at any successful B2B startup like Okta, Mulesoft, Servicenow and their sec filings. Sales spending is always higher than R&D. It’s also assuming that your software is bug free and software engineers can spend time doing poc, demos etc or they like doing that. As much as we can all hate enterprise sales, just getting a contract from a large fortune company is a big deal.

My, albeit limited experience, does tell me it is hard to sell B2B without dedicated sales people of some sort.

"The concept is based on the assumption that if you build something that is useful and works well, the users will eventually come to you as result."

Sounds a lot like "Build it and they will come", which has been the death of quite a number of startups. Certainly it's important to build something amazing, but I think you ignore marketing and sales at your own peril. You need someone looking at how a product is perceived in the market, not just how amazing it is.

You have a "Request Demo" button on your homepage. Who's going to give those demos? Who's going to nurture past demo requesters to make sure their level of interest only goes up after the demo, not down?

You mention an "Enterprise" option on your homepage and pricing page. Who's going to do demos for all the stakeholders, uncover the company's pain points and goals, handle dozens of questions and objections, fill out security surveys, follow up to a bunch of times to make sure the deal is signed, and so on?

Who's going to ensure you have a pipeline of enterprise deals to hit your revenue goals?

When you're brand new, have a small team, and hardly get any enterprise leads, it's easy for the CEO or CTO to do all of that. Don't assume you can continue doing that forever if you have any ambition to grow.

Seems the article isn’t as black and white as the headline. Is the marginal dollar better spent on engineering or sales and marketing? The answer varies over the course of a product’s lifetime. The higher dollar value the purchase, the more important sales becomes over time.

Tempting to believe, but it would be good to see some examples of B2B companies who succeeded via this route. Posthog were founded this year, according to Crunchbase, so this is a very young company to be giving concrete strategy advice.

Atlassian is one example that grew without a traditional sales team, having a very low touch sales process

I think they are definitely the exception than the rule though

https://www.intercom.com/blog/podcasts/scale-how-atlassian-b...

Always good to read marketing pieces about how a company is too focused on their product to do any marketing.

Sure, but that's like saying you don't need an airplane to go from point A to point B just because you were able to walk anywhere hitherto. It depends.

You may not need a sales team for distribution now, but that's due to selection bias, the stage of the growth PostHog is at, and what PostHog does. The product itself can be kept outside of the company's network, with a Javascript snippet sending events to PostHog.

Some products make it that some clients, especially in sectors that are heavily regulated or sensitive cannot just start using the software, and even if you don't need to engage them and reach them, somebody at some point must close even if it means greeting them at the door or formalizing a purchase decision.

It may not be a sales team/sales rep, but they'll need to sit down with someone and go over a few things, with legal, security, etc in order to green-light the purchase.

Some enterprise clients are afraid you might be a company that's really an agent of their competitor, and even if you're not, some clients may be afraid that a competitor might buy you and access sensitive information. How much this is true differs (sector, what the product does, etc.).

So, a product lead growth, great. I suppose there is an enterprise offering, with maintenance involved. There is a CIO/CFO somewhere who has the authority and/or purchasing power or who has the ear of someone who has either or both.

So, you don't need a sales team or marketing team or PR team right now, but wishing all the best to PostHog and given the product adoption, you might need them very soon. In fact, you probably already have them in the form of one or many of your team-members who are dealing with enterprise clients.

Disclaimer: perspective shaped mainly from my context. Custom, turn-key, data products for large organizations. From conversation, problem-statement, to data connectors, learning subject matter, model training & deployment, sometimes making hardware, and web application that goes with that for acceptable figures. The demand is high and we became the bottleneck, so we built a machine learning platform to make shipping these products way faster. We're trying PostHog for usage data, too, so there's that!

- May work for situations where the buyer is the user

- Doesn't work for B2B/enterprisey products/SaaS, where often buyers and users are separated by many levels of corporate hierarchies.

Product is definitely the most important, but somewhere in the piece it talks about how marketing and sales become unnecessary, which is so dumb. Once your funnel is optimized and working well marketing just becomes free money as every cent you spend turns into dollars on the other end. But for most companies where there is a lot of room to improve on the product, spending on product should have more returns than spending on marketing.

The comments in this thread are a pleasant surprise. Glad to see the deserved pushback to this article from people who've learned from experience that sales and marketing play a crucial role in growing a B2B startup.

Did this startup founder just seriously make a case for their B2B product's growth model with Facebook's B2C network effects based growth model?

Sounds like a company headed for https://ourincrediblejourney.tumblr.com/

>posthog.com

lol really?

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