How can a fluffy thing like organizational culture be a growth hack? If you ask Klaus Nyengaard, investor and ex-CEO of Just Eat, the right culture is a prerequisite for scaling. And don’t forget about selling directly. The Nordic Growth Hackers #5 on January 28th 2016 brought new perspectives to growing digital companies.

Cold beer & sodas in the fridge, hot pizza delivered after the talks, and all seats occupied. The setting was familiar at Founder’s House, Copenhagen, but this fifth edition of the Nordic Growth Hackers had a substantial change; a 30 minute keynote rather than 3 x 15 minutes presentations to begin with.
The attendees I talked to about the new format were positive, so I guess it will be a thing to repeat in future NGHs.

Culture? Your most important growth hack

First speaker on the floor was Klaus Nyengaard. He hates the term “growth hacking”:
“It came from some marketing people who wanted to be developers and weren’t”.
Anyway, the guy has some heavy growth cases in his briefcase so we’d better listen to his advice.
Growth is easier than it used to be, he says. Due to the online economy, when you have a product/market fit, you can start scaling and – theoretically – pour an endless amount of money into it for infinite growth.
But company culture may be what stops you from getting to that land of milk and honey. Get your culture wrong and the company will never take off, product/market fit or not.

What is Dunbar 148?

Anthropologist Robin Dunbar suggested 148 is the number of people your brain can manage to have a real, personal relationship with – simultaneously. And that’s one of the critical sizes of a company, where you have to be careful, because as a leader you lose the sense of each individual in your organization.
https://en.wikipedia.org/wiki/Dunbar%27s_number
Other critical sizes are around 6-8, 25-30 – and 700, if you ever reach that level. Those figures actually resemble the sizes of various units in the military – sizes reflected in armies all over the world. Makes sense – the military knows about people management.
The most critical size, according to Nyengaard, is when you are growing from 25, where you have to add middle managers. When the change is coming up, warn your team and decide as a founder: What do I want my role to be in the organization’s next iteration?
It’s also around the 30 people mark you need one full time Growth Hacker.

Nordic Growth Hackers

Klaus Nyengaard, GenieBelt

Klaus Nyengaard

Hail SEASER

Back to the growth hacking: GenieBelt have split their user journey into Signup, Explore, Action, Share, Email, Reaction. SEASER.
Every step of the journey is monitored carefully by GenieBelt for performance, and it took them more than 2 years to get to the point where they could see a clear product/market fit and where things started to take off.
Watch the video at 13:53 for more in-depth knowledge:

Getting user feedback is crucial. User complaints are always right – but their suggested solutions are not necessarily right. So be careful implementing what users ask for. Only test and implement stuff that really adds value to the user experience.
Collecting endless amounts of data can be a hindrance: Today people are waiting too long for enough data. Take the risk, make a decision, Klaus says.
Then Klaus moved on to talk about culture at his previous companies Just Eat and Scandinavia Online, and then Wahanda, part of his current portfolio. Wahanda does growth hacking the way things should be done today with a dedicated Business Intelligence team.

“Entreprofessional” paratroopers!

Klaus has invented his own term for the mix between entrepreneurs and professionals. The creative and unstructured vs the business oriented, structured personalities: entreprofessionals.
A rare species but extremely important to scaling startups: They both work well and thrive in an entrepreneurial environment. And at the same time fit into and understand the more structured approach necessary when scaling to 100s of employees.
They can switch between the two mindsets and go through years of scaling. They will carry the company history and culture with them. So make sure you have at least a couple of entreprofessionals on your core team when setting out to scale.
“Paratroopers” is another term – again showing Klaus’ military fling: A paratrooper is a person who can carry out many different tasks in the organization and is most likely an entreprofessional. When you set up in a new country, develop a new business unit or other grand projects, you put your paratrooper in charge of the process.

Be super disciplined about culture

A few pieces of advice on culture from Klaus:
Be super disciplined about culture. It must go for everybody, and don’t settle for average. You have to risk your own neck, because living up to a set of core values can be challenging.
Culture can even be about what you’re wearing (a tie?), what you’re eating (McD?), and off-site activities: Should you go to that very colorful nightclub when in Vegas? What will it signal to your team members? Your culture doesn’t stay in Vegas, it’s with you all the time.

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You will die trying to please everyone

This may challenge – and also relieve – a lot of you founders:
You culture should not be for everybody. People have to adapt a bit to you as a founder. You can’t change yourself trying to please everyone, and sacrificing your own values will not work in the long run.
But you have to be flexible though: Most likely you will have to get customer service and commercial and development to work together. They typically hate each other, but you have to sympathize with all of them and understand each group’s rationale.
You have to be disciplined and face the fact that even if your company has a fun and hip culture, it can be brutal, if you don’t fit in.

Kristeligt Dagblad is growing in a rapidly declining market

As one of only two of Denmark’s traditional newspapers, Kristeligt Dagblad has seen subscriber growth as opposed to the devastating loss of subscribers that most newspapers have faced over the past decade.
A huge part of the reason for the paper’s success took the stage after Klaus Nyengaard. Hans-Christian Kock eats data for breakfast and manages the four people working with data based marketing and customer acquisition at Kristeligt Dagblad.
They have a very thorough and persistent strategy on attracting users via Facebook. Denmark is Facebook country – 50% of the Danish population use Facebook 14 times a day on average!

Hans-Christian Kock, Kristeligt Dagblad

Hans-Christian Kock

Content drives users past the paywall

So Kristeligt Dagblad has gone all in and addresses people on Facebook both by humorous ads, that people actually like and share, and by sharing content that would otherwise typically be behind the paper’s paywall. Give users a taste of the good stuff, and they’ll come back and throw their credit card details at you. At least at Kristeligt Dagblad they do.
Traditional marketing channels don’t come anywhere near the lead generation that KD can drive from Facebook.
Some of the paper’s success probably lies in the fact that a lot of their content focuses on something a bit different from what the mainstream media cover: ethics. They meet a niche demand, so their product/market fit is great – but the actual product was widely unnoticed among the population. But not so much anymore.
Results speak for themselves:
KD went from being a top 60 site in Denmark to top 25. And they’re moving further up that ladder. Impressive.

Trustpilot: Traditional sales ignite growth

Next great product/market fit on stage was Danish unicorn-to-be, Trustpilot.
CCO at Trustpilot, Jesper Lindhardt, went through their sales model and international expansion methodology.
They’ve been around for 7 years with the current business model, 10 percent of their current business is in Denmark, a third in the US and a third in the UK.
Main growth drivers are simplicity and relevance. As Jesper puts it, e-commerce is the same everywhere. There may be differences in verticals, but not in countries.
Trustpilot is in a “the winner takes it all”-game, and the game must be won country by country. They can’t be everywhere, so they focus on a few places at a time.
Although they’re only scratching the surface of the potential market, Trustpilot is already largest provider in the US. They simply have to grow faster than their competitors to stay in business!
Growth hackers talk a lot about reaching a scalable sales model, where the bits & bytes do all the hard work. But at Trustpilot they can’t wait for that, so they do active personal selling – canvassing.
“We ignite the engine, we’re not waiting for them to call us,” Jesper told us.
Trustpilot invites consumers to review an online business. That fuels the engine. The reviewed company must choose whether to engage with Trustpilot or do the hard work themselves. Trustpilot’s phone call is the spark. Ignition. Wrooom. Sale!
So Trustpilot focuses on old fashioned sales metrics, but they work well for them.

 Jesper Lindhardt, Trustpilot

Jesper Lindhardt, Trustpilot

Culture also key at Trustpilot

Trustpilot has a true global mindset: Denmark is a great country, but way too small a market. The pool is too small for global commercial talent, so many nationalities work at Trustpilot’s HQ in Copenhagen.
And Jesper stresses that Denmark is a good brand abroad, so use it whenever you can!
Jesper also had a few comments on Klaus Nyengaard’s presentation about company culture. He sees that while growing, Trustpilot’s company culture will gradually change from “cowboy”, maybe stay a bit startup style, but become more corporate along the way. Entreprofessional?
Trustpilot runs a number of international offices. The cultural values across the offices are basically the same, but always with a local twist. Trustpilot aims to take these local twists back to the Copenhagen HQ and try to incorporate them into the overall culture.

Sebastian Engelbrecht, SimpleSite

Sebastian Engelbrecht, SimpleSite

SimpleSite: 400,000 new websites per month

SimpleSite has users all over the world except in Sudan, North Korea and Cuba.
Sebastian Engelbrecht, CSO of SimpleSite, walked us through “Global marketing done locally”. The company shifted to a freemium model in 2015 and are starting to see the returns of growing their base of live DIY-websites by 400,000 per month – a huge increase compared to spending 12 years going from 0 to 90,000 customers in a “trial period & subscription” model to now +4 million websites over the past 10 months.
Those 400,000 trials are mainly generated by Search Engine Marketing. SimpleSite used to have an extensive partner program but came to the conclusion, that the efforts to maintain relationships with partners were huge compared to the acquistition costs of customers via SEM.
Until 2012 Google was almost SimpleSite’s only SEM channel, but in recent years they got Facebook, Bing, Baidu and other channels to work, so now Sebastian and his team of two are spending their SEM dollars across a wide range of channels.
Getting a channel to work is basically about experimenting with your ads until the customer acquisition cost of that channel is satifactory compared to the lifetime value of customers from that channel. For each segment – countries, verticals etc.

Crowded SEO space

While their paid SEM works pretty well, SimpleSite is challenged when it comes to SEO. Their competitors are typically higher ranked. Maybe the millions of freemium sites will help them reach better page ranks. Currently user content drives 40% of SimpleSite’s new business, so the live websites definitely contribute to sales.
A takeaway for hacking a new market; localization of ads are important, and so is localized onboarding. But once on board, users in most countries have no problem using the English version of the service.

Highlights from the panel Q&A

  • If I tell my friends on Facebook about your brand, it’s not because I like your brand –it’s because I like my friends.
  • What content is best for lead generation? Neither editor nor journalist decide – a data analyst does!
  • Run the same ad copy, but change the images biweekly. Images attract attention to the copy.
  • SEO is important for long tail sales.
  • Content kills traditional marketing.
  • Trustpilot: Does traditional selling disqualify a startup? No, you have to sell personally to learn what your customers want and need.
  • Retention at Trustpilot: Not just a walk in the park, you have to make clients realize the value. Trustpilot holds a 80-90% retention rate.
  •  YouTube seems to be more expensive than Facebook for video prerolls. Just so you know …

So. All in all another great evening of inspiration and knowledge sharing among Nordic Growth Hackers. Can’t wait to see you all at NGH#6 on April 21, 2016DSC_1153_batch

CategoryExperiments