Crossing The Canyon To Product Leadership

Casey Winters (CPO @ Eventbrite), Fareed Mosavat (Reforge EIR, Former Dir Product @ Slack), recently published Crossing the Canyon: Product Manager to Product Leader. The main point, most product careers stall out trying to make the jump to leadership.

The core reason: what got someone to a senior product manager, does not get them to a product leader. Rather than an evolution of skills, it is a completely new set of skill. This creates the product leader canyon.

There are four main transitions someone needs to make:

1. Depth in one type of product work → Breadth across multiple types of product work

2. Being good at your job → training others to be good at theirs

3. Solving with the resources you have → Solving by allocating resources and influencing others

4. Gaining more personal scope → Creating more scope for the organization

When I read the article, there was one section that hit close to home because I've made this mistake repeatedly in the past:

"A common trap is keeping the most important projects for yourself. Because you got to this level by being a great executor, the natural thought process is: "This is important, I can create a better outcome myself, therefore I should do it." The first two parts of that statement are often true. It is important and you probably can do it better yourself. But here is what happens when you do this:

1. Stolen Learning Opportunity - You've taken an opportunity to learn away from someone on your team.

2. Trap Yourself In The Weeds - You've taken away your ability to spend time on the hard strategic work that makes you successful in the leadership role because you are in the weeds of delivering a hard and important project.

3. Holding The "Secrets" - You end up not communicating the things that you know that will help others be better at their job because when you are the one executing, you aren't forced to."

These principles don't just apply to product, but across a lot of functions so I recommend reading the full article regardless of your role.

Don't Publish On Medium

Last week I did a small group session on personal brand building. It was the first time I had ever spoken about that topic and I was surprised by how many people wanted to talk about it. If this is something you are interested in, let me know and I'll write more about it.

But one of the quick side comments I made was publishing on Medium is a terrible idea. That comment seemed to catch a lot of people by surprise and some followed up to ask why.

Three Reasons Why Publishing On Medium Is A Bad Idea

1. You Are Building Medium's Brand, Not Your Own

   Think about it. When someone tells another person about an article they read on Medium, they almost never say "Did you see this awesome article by [author]." They almost always say "Did you see this awesome article on Medium."

   Why? Every site has a hierarchy of presence. For Medium, the top of the hierarchy is clearly Medium. There is little presence of the author. It's even worse for Medium publications where the hierarchy is Medium → Name of Publication → Author. Most readers never see past the top of the hierarchy and as a result, people aren't associating your hard work with you, they are associating it with Medium.

2. You Have Little Ownership Over the Audience

   You have little to no ownership over your own audience. You can't take your audience elsewhere, you have no other way to communicate with them besides publishing again, and the controls to collect emails within a Medium post is severely limited.

3. Monetization Is Garbage

   If you want to monetize your audience, Medium is terrible. I still haven't seen repeated evidence of writers making meaningful amount of money. Plus, adjacent opportunities like workshops, courses, etc aren't possible because of #1 and #2.

People commonly push back on a couple things.

• There Is Built In Distribution - What is the point of having distribution, if it is resulting in not building your brand, building your audience, or monetization?

• It's So Easy To Write There - Yes, it might be low friction. But with tools like Squarespace, Webflow, Substack, and so many others you can stand up your own website on your own domain in 30 minutes or less.

Why Substack Will Take Over Medium

I have a hypothesis that Substack is going take over Medium. Substack is draining the brain of Medium. They are clearly attracting the smartest and best writers. Why? Look no further to the reasons above.

• You own your audience on Substack.

• The author/publication name is at the top of the hierarchy of presence, not Substack, and as a result you are building your own brand, not someone else's.

• The monetization opportunity is far better. I don't know the exact numbers, but my best guess is there are way more writers already making 5 and 6 figures on Substack vs Medium. Plus, since you own the contact info of your audience you may be able to monetize them in other ways.

• They do all of the above, while also removing tons of friction to the creation.

Medium has a large head start on their content growth loops. But those content loops are driven by quality content. If the brain drain continues, those content loops will break.

The Headwind Tailwind Spectrum

Fareed Mosavat (Reforge EIR, Former Slack/Instacart/Zynga) and I have been having a lot of conversations lately on how to adapt growth strategies in these crazy times. We wrote a detailed post on how we are thinking about it. A few key points:

1 - We Are In The Middle Innings

With COVID, customer behavior changed overnight. We all had to react to those changes. But those that pull out of this in the lead will realize we are entering the middle innings of this game. Customer behavior is going to continue to change and we need to continue to adapt our strategies quickly.

2 - Your Strategy Depends on Where You Are On The Headwind ↔ Tailwind Spectrum

Your product lives somewhere on the headwind to tailwind spectrum

• Extreme Headwinds - The majority of your customers' habits with your core problem have been completely broken. The core question is how do you re-establish habits and with whom?

• Extreme Tailwinds - The majority of your target customers' habits have been accelerated and strengthened. You are also seeing unintended audiences start to build new habits. The core question is who are you going to keep and how?

• In-Between - Some of your customers' habits have been broken, some weakened, some strengthened, etc. The net effect of this and how it might change is likely not 100% clear. The core question is how do you be proactive vs reactive?

3 - Engagement Data Is Misleading In Almost All Cases

In all cases, engagement data is only part of the story and in isolation is misleading.

• Tailwinds - Just because users are showing healthy frequency of engagement, doesn't mean they will stick post COVID. A teacher being forced to use Zoom because they can't be in the classroom is probably showing healthy engagement right now. But that doesn't mean they will stick post COVID. Instead, you have to look at underlying behavior data of why they are using the product and gauge whether that why will sustain.

• Headwinds - Just because a user use to have healthy engagement, does not mean we should prioritize them. If we are Eventbrite, looking at prior usage data might lead us to a segment of customers like concert promoters. Pre-COVID, they had high frequency and high value. So what if we focus there first? It's unlikely that this segment will be the first to come back to the platform. Instead, you have to look at how fast a Use Case will come back, and what the strength of the alternative those customers has chosen.

• In-Between - You have to evaluate each customer to see where they are on the headwind/tailwind spectrum. Then apply the strategies from Tailwind and Headwinds.

Read the full details of determining your retention strategy in uncertain times here.

Defining Target Audiences

I appreciated this tweet from Andy Johns (Former Wealthfront, Quora, Twitter, Facebook):

When it comes to the question of the target customer, the most common mistake is the target customer definition is too broad. It must be almost comically narrow to the point where you may be misunderstood for such a narrow focus. A few examples to illustrate...

— Andy Johns (@ibringtraffic) May 8, 2020

I couldn't agree more and wanted to add a couple of thoughts:

Driving Word of Mouth

Driving word of mouth is critical in the early growth days of any product. The way you drive word of mouth is by delivering a 10X experience. The way you deliver a 10X experience early with very limited resources is by constraining your target audience.

Scope → Access → Filter → Success Signal → Leverage → Repeat

A comically narrow audience to maximize growth is counter-intuitive for most people. The thinking usually goes, "the more people that try the product, the better the chance for growth." But its the opposite. In How To Launch a Product or Feature To Maximize Growth I detailed out how to think about a repeatable launch process:

1. Scope - Define a very specific audience hypothesis.

2. Access - Figure out how you are going to access that audience.

3. Filter - Filter for that audience during sign up.

4. Success Signal - Gather feedback and data that shows signals of success.

5. Leverage - Leverage it out to the next adjacent audience.

Cycles through this loop should lead you to expand into adjacent audiences. You can think about it as layers of concentric circles. Understanding these order of operations is key.

Having the restraint to do this is very difficult. Companies I've seen do this well recently are Superhuman, Grain, Roam Research, and Clubhouse.

Retention Benchmarks

Is 100% net revenue retention bad, good, or great? Questions like this lead teams to seek out benchmarks. I've previously written about the traps of benchmarks where I made a few points:

1. Averages Are Useless - Most benchmarks are averages. Averages are useless. You want to benchmark against best in class. One of my favorite quotes is from Fareed Mosavat (Reforge EIR, Former Slack) - "Never benchmark against averages. The average company fails."

2. Same Metric, Different Measurement - CAC is CAC. LTV is LTV. Retention is Retention. Right? Definitely not. I've seen each of these measured in very different ways at different companies. So when someone reports these metrics for benchmark reports, its almost never apples to apples.

3. Context Is Everything - Most benchmarks lack context and we end up with a deceptively incomplete picture.

But there is no denying it, people love benchmarks. Casey Winters and Lenny Rachitsky rounded up good and great retention benchmarks from leaders within the Reforge community, which I participated in.

The post triggered a pretty hot convo on Twitter. Some of my takeaways and favorite points:

1. Wake Up Call - I think the good/great values were a wake-up call for some venture-backed founders on what it truly takes to hit that kind of growth. If you don't have these numbers, and you are venture-backed, you need to have an honest discussion if you have a viable strategy to get there because driving retention is not getting easier.

2. When Low Retention Is Ok - One of my favorite points was from Dan Hockenmaier (Basis One, Former Thumbtack) who is a co-creator on Reforge's Monetization program. His point:

   • "Low retention can be a good thing, when you have low acquisition and marginal costs, and exponential returns to scale for those that do retain. An example from Ben Thompson is Shopify - “The more companies that use Shopify and fail is a positive indicator for Shopify, because that means they are getting more rolls at the dice at that one thing that hits it big.”

3. Retention Is An Output - We try to hammer this home in the Retention program. You do not improve retention by brainstorming against ideas to improve retention. You have to identify the input that creates retention. That is most often Activation as Josh Elman points out here.

At the end of the day, my advice is to build bottoms-up model to truly determine whether your retention (or any metric) is bad, good, or great. Your retention has to support sustained growth. Some of the things you need to account for:

• Acquisition Motion - Think about your acquisition motion and whether it supports your ability to grow the product at your current retention rates. For example, if you are a consumer social app with retention that flattens out at 10%, and you need 100M active users to build a big business, that means you need to acquire 1B users. Does your acquisition motion support that? Some recommended reading - Product Channel Fit and Model Channel Fit.

• Expansion Motion - The expansion motion also influences what is good and great. If you are a bottoms-up SaaS tool, 100% net revenue retention is not good and won't build a venture scale business. You are acquiring at low ACV's and you need those to expand. But others don't have this motion. In that case, the strategy is to capture more upfront (via 1 year plans, etc) and maintain the dollars.

• What You Can and Can't Influence - There are levers you can influence, and those you can't. Take Gusto for example. Their pricing primarily expands on the number of employees you have. Is Gusto going to influence how many employees their customers hire? No. That means most of their efforts need to go into maintaining their customers vs expanding. The only way to influence expansion is to offer more product lines/tiers which take years to develop.

• Stage + Strategy - Not all companies had great retention from the start. HubSpot for its first 5 years had below 100% net revenue retention. But that was ok. There was a multi-year strategy to develop add ons, higher-priced tiers, and additional products to drive additional expansion. These strategies don't happen overnight. They take years to develop. By the time HubSpot went public, they had >100% net revenue retention. So while the retention wasn't great early, it was good enough to give the company the opportunity to execute those things.