[500distro] shake, mix, stir, kabam! how one startup grew from $0 to $360mm in 4 years

$0 TO $360MM IN 4 YEARS FLATHOLLY LIU, CO-FOUNDER & CHIEF OF STAFF AT KABAM@HollyHLiu

@HollyHLiu

@HollyHLiu

@HollyHLiu

@HollyHLiu

$360 MM

$180 MM

$30 MM

$0

2010 2011 2012 20132009

$360 MM

@HollyHLiu

@HollyHLiu

@HollyHLiu

@HollyHLiu

Non Scalable Growth Methods

• Forum / Group Posting• Contests• Blog Posts• Friends and family

@HollyHLiu

Important because…

• Product-market fit• Interact directly with customers

@HollyHLiu

Nail It. Then Scale It.

@HollyHLiu

@HollyHLiu

5-7%weekly

http://www.paulgraham.com/growth.html#f6n

@HollyHLiu

Scalable Growth Methods

paid acquisitionsales

SEOvirality

pipeline + team

BUYBUILD PARTNER

@HollyHLiu

Why?

• Feedback Loops• Easily repeatable – create a playbook• Do once and get massive audience

@HollyHLiu

Scalable Growth Methods

paid acquisitionsales

BUY

SEOvirality

BUILD

pipeline + team

PARTNER

@HollyHLiu

Build

@HollyHLiu

Focus Areas

• Acquisition• Retention• Engagement• Monetization

@HollyHLiu

Business Model• Advertising Business Model = Large audience

INSTALLS

conversions

invitesclicks

@HollyHLiu

Build

@HollyHLiu

Framework• Business Model: Advertising• Focus: Acquisition• Metrics:

@HollyHLiu

Metrics• Click-thru’s (link tracking)• Installs• Invites Sent• Conversions• DAU’s (Daily Active Users)

@HollyHLiu

Scalable Growth Methods

SEOvirality

BUILD

@HollyHLiu

BUY

@HollyHLiu

3 Things

• Market Opportunity• Team Capabilities• Passion Points

@HollyHLiu

Free-to-play

Freemium Microtransaction Business Model

@HollyHLiu

@HollyHLiu

Framework• Business Model: Free to Play (freemium)• Focus: Retention and Monetization• Metrics:

@HollyHLiu

Metrics• D1 Retention• D7 Retention• ARPU• ARPPU • LTV

@HollyHLiu

LTV(Average Order Value) * (Number of Repeat

Sales) * (Average Retention Time)

$10 * 12 months * 3 years = $360

@HollyHLiu

LTV - Starbucks(Simple LTV) * (Custom LTV) * (Traditional LTV)

Simple LTV = 52(a) * tCustom LTV = t(52 * s * c * p)Traditional LTV =m(r ÷ (1+i-r))

http://blog.kissmetrics.com/how-to-calculate-lifetime-value/?wide=1

@HollyHLiu

Success

Cost of Customer Acquisition < Customer Lifetime Value

@HollyHLiu

Scalable Growth Methods

paid acquisitionsales

BUY

@HollyHLiu

PARTNER

@HollyHLiu

content

platform

@HollyHLiu

Game Plan

• Partner– Content – Platform– Applications

@HollyHLiu

Content

@HollyHLiu

Platform

@HollyHLiu

Applications

@HollyHLiu

Metrics

• Organic Traffic • Tagging• Revenue associated with organics

@HollyHLiu

Scalable Growth Methods

paid acquisitionsales

SEOvirality

pipeline + team

BUYBUILD PARTNER

@HollyHLiu