How early-stage startups can use data effectively – gpgmail


“If we have data, let’s look at data. If all we have are opinions, let’s go with mine.” – Jim Barksdale

It is a commonly held belief that startups can measure their way to success. And while there are always exceptions, early-stage companies often can’t leverage data easily, at least not in the way that later stage companies can. It’s imperative that startups recognize this early on — it makes all the difference.

In this piece, I draw on my experiences using data to take Framer from seed round to Series B. More concretely, I’ll describe what to (not) focus on, and then, how to get real results.

There are good and bad ways for startups to use data. In my opinion, the bad way unfortunately is often preached on saas blogs, a/b test tool marketing pages, and especially growth hacker conferences: that by simply measuring and looking at data you’ll find simple things to do that will drive explosive growth. Silver bullets, if you will.

The good way is comparable to first principles thinking. Below the surface of your day to day results, your startup can be described by a set of numbers. It takes some work to discover these numbers, but once you have them you can use them to make predictions and spot underlying trends. If everyone in your company knows these numbers by heart, they will inevitably make better decisions.

But most importantly, using data the right way will help answer the single most important – but complex – question at any moment for a startup: how are we really doing?

Let’s start with looking at what not to do as a startup.

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Common pitfalls

Don’t measure too much

Technically, it’s easy to measure everything, so most startups start out that way. But when you measure everything, you learn nothing. Just the sheer noise makes it hard to discover anything useful and it can be demotivating to look at piles of numbers in general.

My advice is to carefully plan what you want to measure upfront, then implement and conclude. You should only expand your set of measurements once you’ve made the most important ones actionable. Later in this article, I provide a clear set of ways to plan what you measure.

A/B tests are anti-startup

To make decisions based on data you need volume. Without volume, the data itself is not statistically significant and is basically just noise. To detect a 3% difference with 95% confidence you would need a sample size of 12,000 visitors, signups, or sales. That sample size is generally too high for most early-stage startups and forces your product development into long cycles.

While on the subject of shipping fast and iterating later, let’s talk about A/B testing. To get reliable measurements, you should only be changing one variable at a time. During the early stages of Framer, we changed our homepage in the middle of a checkout A/B test, which skewed our results. But as a startup, it was the right decision to adjust the way we marketed our product. What you’ll find is that those two factors are often incompatible. In general, constant improvements should trump tests that block quick reactionary changes.

Understand your calculations


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How should B2B startups think about growth? Not like B2C – gpgmail


Over the years, we’ve seen a lot of B2B companies apply ineffective demand generation strategies to their startup. If you’re a B2B founder trying to grow your business, this guide is for you.

Rule #1: B2B is not B2C. We are often dealing with considered purchases, multiple stakeholders, long decision cycles, and massive LTVs. These unique attributes matter when developing a growth strategy. We’ll share B2B best practices we’ve employed while working with awesome B2B companies like Zenefits, Crunchbase, Segment, OnDeck, Yelp, Kabbage, Farmers Business Network, and many more. Topics covered include:

  • Descriptions of growth stages you can use to determine your company’s status
  • Tactics for each stage with specific examples
  • Which advertising channels work best
  • Optimization of your ad copy to maximize CTR and conversions
  • Optimization of your sales funnel
  • Measuring the ROI of your advertising spend

We often crack growth for companies that didn’t think it was possible, based on their prior experience with agencies and/or internal resources. There are many misconceptions out there about B2B growth, rooted in the misapplication of B2C strategies and leading to poor performance. Study the differences and you’ll develop a filter for all the advice you get that’s good for one context (ex: B2C) but bad for another (ex: B2B). This guide will get you off on the right foot.

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What growth stage is your B2B startup?

The best growth strategy for your company ultimately depends on whether you’re in an incubation, iteration, or scale stage. One of the most common mistakes we see is a company acting like they’re in the scale phase when they’re actually in the iteration phase. As a result, many of them end up developing inefficient growth strategies that lead to exorbitant monthly ad spends, extraneous acquisition channels, hiring (and later firing) ineffective team members, and de-emphasizing critical customer feedback. There is often an intense pressure to grow, but believing your own hype before it’s real can kill early-stage ventures. Here’s a breakdown of each stage:

Incubation is when you are building your minimum viable product (MVP). This should be done in close partnership with potential customers to ensure you are solving a real problem with a credible solution. Typically a founder is a voice of the customer, as someone who experienced the problem and sought out the solution s/he is now building. Other times, founders enter a new space and build a panel of prospective buyers to participate in the product development process. The endpoint of this phase is a working MVP.

Iteration is when you have customers using your MVP and you are rapidly improving the product. Success at this stage is rooted in customer insights – both qualitative and quantitative – not marketing excellence. It’s valuable to include in this iterative process customers with whom the founder(s) have no prior relationship. You want to test the product’s appeal, not friends’ willingness to help you out. We want a customer set that is an accurate sample of a much larger population you will later sell to. The endpoint of the iteration phase is product/market fit.

Scale is when you have product/market fit and are trying to grow your customer base. The goal of this phase is to build a portfolio of tactics that maximize market penetration with minimal – or at least profitable – cost. Success is rooted in growing lifetime value through retention and margin, maximizing funnel conversion to efficiently convert leads to customers, and finding repeatable tactics to drive prospective buyers’ awareness and consideration of your product. The endpoint of this phase is ultimately market saturation, leading to the incubation and iteration of new features, customer segments, and geographies.

How do you find B2B customers? 

Here’s a list of B2B customer acquisition tactics we commonly employ and recommend. Later in this article, we’ll connect each channel to the growth stage it’s best used in. This list is generally sorted by early stage to later stage:

1. Leveraging your network. This is particularly valuable for founders who are building a product based on their own past experience.

  • Reach out to old colleagues you know have the same problem you had (and are solving).
  • Leverage the startup ecosystem. If your startup is in YCombinator, for instance, other companies in your batch may be prospects, along with alumni who will take your call simply because of your affiliation.
  • Example: If you’re building an app for marketers, ask past marketing colleagues you’ve worked with to try out your product is a no brainer.


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