2. Katya Constantine: DigishopGirl
• 12 years of online marketing
experience
• Background in email and cross-
channel marketing
• Led digital marketing efforts for
brands including Expedia and
Amazon
• Active industry blogger
2
Katya Constantine
www.digishopgirl.com // www.brandfoundryvc.com
3. Sumeet Shah: Brand Foundry
• 6 years of experience in startups
and private equity
• Handles sourcing, executing, and
monitoring new opportunities
• Ran new business strategies at Gist
Digital (development studio)
• Handled business development
and project work at Gotham
Consulting Partners (private equity
consulting)
3
Sumeet Shah
www.digishopgirl.com // www.brandfoundryvc.com
4. Why Are We Here?
• How to come up with strategy to acquire users
o Your mix of channels will vary dramatically depending on your industry, budget and scaling goals
• You want to raise VC money
o Understand how VC’s look at user acquisition
o How will VC’s perspective affect your strategy
www.digishopgirl.com // www.brandfoundryvc.com 4
5. Agenda
OBJECTIVE: Build and strengthen a roadmap for success to a) ensure traction for your
startup and b) answer key questions from potential and current venture investors.
• The basics
o Customer acquisition funnel
o Your first 1,000 users
• Channels an Metrics
o What matters most to venture capital firms
o What metrics are important for growth
• The process
o How to achieve key metrics for traction
o Useful ways to showcase key milestones to potential (and current) venture investors
• The future
o How to ensure consistent traction within long-term growth roadmap
5www.digishopgirl.com // www.brandfoundryvc.com
6. Main Channels by Funnel Stage
www.digishopgirl.com // www.brandfoundryvc.com 6
Awareness
Consideration
Conversion
Service
Loyalty
1. Content/Viral
2. Contests
3. PR
4. Affiliate/Partners
1. Email
2. Paid Search
3. Social Ads
1. Retargeting
2. Email
3. Analytics
4. Landing Page
1. Social Listening
2. Reviews
3. Mobile
1. Email
2. Content Mrkting
3. B2B-Content
Marketing
Analytics
7. Your 1st User
• Lets say, I want to acquire 1 user
• Eureka! I should post something on my Facebook
• Boom! I got 5 users
• So far, So Good…
www.digishopgirl.com // www.brandfoundryvc.com 7
8. Users – 5; Cost - $0
www.digishopgirl.com // www.brandfoundryvc.com 8
Awareness
Consideration
Conversion
Service
Loyalty
1. Content/Viral
2. Contests
3. PR
4. Affiliate/Partners
1. Email
2. Paid Search
3. Social Ads
1. Retargeting
2. Email
3. Analytics
4. Landing Page
1. Social Listening
2. Reviews
3. Mobile
1. Email
2. Content Mrkting
3. B2B-Content
Marketing
Analytics
Social Media is Awesome!!
10. Your 1st 100 Users
• I think I’ve run out of real friends
• I need to spend some money
o Paid Search
o Social Ads
• Good news… I can get some users on Google and FB
• Bad news… I am spending $100 to get a customer
www.digishopgirl.com // www.brandfoundryvc.com 10
11. Users – 100; Cost - $100 per user
www.digishopgirl.com // www.brandfoundryvc.com 11
Awareness
Consideration
Conversion
Service
Loyalty
1. Content/Viral
2. Contests
3. PR
4. Affiliate/Partners
1. Email
2. Paid Search
3. Social Ads
1. Retargeting
2. Email
3. Analytics
4. Landing Page
1. Social Listening
2. Reviews
3. Mobile
1. Email
2. Content Mrkting
3. B2B-Content
Marketing
Analytics
So
expensive!
12. Your 1st 1,000 Users
• Ok, so my cost is $100 per user, but is that good
or bad?
• If you are going to keep spending money, you
need an LTV model
• It is likely that what you are spending so far to
acquire a user is too expensive
• How do I acquire more effectively? - Need more
tools
• Conversion & Analytics
www.digishopgirl.com // www.brandfoundryvc.com 12
14. The VC Angle: Why It Matters
14
Growth Rates (Revenue/Users)
• Price threshold that satisfies both
users and product costs
• Marketing growth from WOM to
social media, SEO, paid search, etc.
• Viral-ness of product portfolio
amongst potential and current
users
Innovative, “Sticky” Products
• Pure creative, first in market
• Strong differentiators
• Partnerships with brands/startups
• Front-to-back platform connecting
product with technology
(regardless of how tech-enabled
product is)
Scale/Traction
• Finding the right retail and/or
marketing channels
• Evangelists, both in investor and
user landscapes
• Correct use of content to match
product portfolio
The first 1,000 users is a great way to outline the efficiency and success of your startup. Overall, it’s
a showcase of three major areas that venture capital firms are looking for when making early-stage
investments.
Strong user growth helps to identify scale, growth rates (within revenue and/or user base), and the
demand for your startup’s product portfolio.
www.digishopgirl.com // www.brandfoundryvc.com
15. 100,000 Users – Not So Fast
• Wow! I just discovered long tail keyword targeting – getting users cheaply is
a breeze
• Wait, what do you mean only 30 people a day search for a mechanical
velociraptor?
• What may have worked for you early on, often doesn’t scale as your business
grows
• Scalable user acquisition = experimentation
www.digishopgirl.com // www.brandfoundryvc.com 15
17. Analytics Overview
www.digishopgirl.com // www.brandfoundryvc.com 17
Key Areas for Improvement
• Data which is relevant and
accurate
• Dashboard with summary of key
metrics: daily and over time
• Data analysis by key segments (i.e.
location, device, channel)
• Performance analysis to determine
strongest ads, emails, etc.
Showcasing Results
• Familiarity with analytical tools
and reports
• Data visualization
• Correct set-up of links and UTM
codes
Initial Investment
• Google Analytics (free)
• Leverage reports in existing tools
and platforms
• Use of more advanced tools:
• Tableau
• Optimizely
• Looker
• Raventools or Moz
Companies have access to a vast amount of data as a result of their online presence. Detailed data is
available regarding a company’s website, email campaigns, social media presence and online
advertising. Actionable insights can be discovered by analyzing this data and recognizing trends.
It is important to set up the right infrastructure to ensure the right data is accurately captured.
Additionally, the correct tools make analyzing and visualizing the data much easier.
18. Paid Search Overview
www.digishopgirl.com // www.brandfoundryvc.com 18
Key Areas for Improvement
• A/B Testing – ad creative
• Control budgets at the Campaign
level
• Control creative at the AdGroup
level
Skills and Competencies
• Familiarity with key terms
important to your business
• Understanding what a conversion
is worth
• Analytics for determining
performance
Initial Investment
• Platforms: Google Display
Network
• Bing once you have a successful
program on GDN
• Analytics
A well-designed paid search program can be very impactful in driving targeted traffic to your site.
Paid search can help with driving targeted new users.
The bidding, campaign targeting and keyword strategy all greatly impact the success of your paid
search channel.
19. Facebook Advertising Overview
www.digishopgirl.com // www.brandfoundryvc.com 19
Key Areas for Improvement
• A/B Testing
• Time of day/day of week
• Audience segmentation
• Visually appealing
• Mobile vs. desktop
Skills and Competencies
• Familiarity with audience targeting
• Analytics for determining
performance
Initial Investment
• Analytics: conversion tracking,
audience list segmentation
• Research: customer persona
• Additional templates and content
• Program analytics
For certain types of businesses, Facebook allows for scalable targeted user acquisition.
The design, testing and segmentation of campaigns all greatly impact the success of the channel.
20. Email Channel Overview
www.digishopgirl.com // www.brandfoundryvc.com 20
Key Areas for Improvement
• A/B Testing
• Time of day/day of week
• Subject line
• Audience segmentation
• Visually appealing
• Readable and click-friendly
• Automated drip campaigns
• Frequency settings
Skills and Competencies
• Familiarity with email platform
• Some HTML experience
• Graphic design
• Analytics for determining
performance
Initial Investment
• Email platform (i.e. MailChimp)
• Welcome series templates and
content
• Additional templates and content
• Email capture tool for website
A well-designed email channel is essential for marketing and communication regardless of your
industry. Email marketing is especially impactful when driving consideration and maintaining
loyalty. It can also help with conversion during relevant sales/announcements.
The design, testing and segmentation of email campaigns all greatly impact the success of the email
channel.
21. Retargeting - Why
Why it Matters
• Can be the best way to close the deal in today’s online landscape
o Multiple touches are key with distracted multi screen users
• Provides strong reminder to potential customers who are already aware
of your brand
• Can build extremely specific campaigns:
o Segment audiences based on website browsing habits
o Establish timeframe to retarget potential customers
o Various platform options: Facebook, website display, Twitter
o Easily exclude current customers
www.digishopgirl.com // www.brandfoundryvc.com 21
22. To Whom it Matters
• Everyone!
• Can be highly effective for start-ups and small
businesses
• Allows for an approach that is more precise and
cost efficient instead of relying on volume or
"spray and pray"
• Requires a baseline retargeting audience of only
~1,000 users
www.digishopgirl.com // www.brandfoundryvc.com 22
Retargeting - Who
23. To Get Started
• Perfect Audience is a great tool to
develop your retargeting campaigns
• Based on needs, you can adjust:
o Ad types and platforms
o Weekly budget and bids
o Reporting at the campaign and ad level
www.digishopgirl.com // www.brandfoundryvc.com 23
Retargeting - How
24. Wow…That’s a lot of info!
• Do I have to use all of it at the same time?
• NO… BUT:
Your optimal mix is likely to include at least a
few of these channels – and change over time
www.digishopgirl.com // www.brandfoundryvc.com 24
26. But What About
Paid Channels Free Channels
www.digishopgirl.com // www.brandfoundryvc.com 26
• Display
• LinkedIn ads
• Pinterest ads
• Twitter ads
• Content Marketing
• SEO
These are all great, but usually for specific industries and often don’t easily scale
28. Metrics that Matter
www.digishopgirl.com // www.brandfoundryvc.com 28
Impressions
CTR
CPC
CAC
LTV
Scale
Am I reaching anyone at scale
Are my ads effective?
Does it hold at scale
Good INTERMEDIATE metric
What is it costing me to acquire?
What is a customer worth?
29. The VC Angle: Milestones & Keeping Us Posted
29
For Potential Investors…
• Monthly newsletters with “traction
bites” (key milestones that focus on
user growth, revenue growth,
revenue pipelines [current and
potential], and partnerships)
• Use language that strongly
outlines the relationships you’ve
built
For Showing Awesomeness…
• We care about showing off.
Seriously. (Because it satisfies our
LPs and helps bolster reputation)
• Happy LPs = happy VCs = more
investment capital available!
• Differentiators matter. Key data
points will go into our personal
investor newsletters.
For Current Investors…
• Special newsletters outlining
production updates, partnership
linkages, and calls for hires and
media assistance
• GOOGLE GROUPS IS YOUR
FRIEND. PLEASE USE IT.
• Direct lines are also your friend
Team and Roadmap are the two biggest pieces that venture capital firms care deeply about with
early-stage investments. Each of the two has multiple sub-sectors, but collectively we care about
startups hitting the right milestones.
Many matter to potential investors but there are key ones that must be seen for current investors.
Moreover, those key milestones can be framed in ways to whet the appetites of potential ones.
www.digishopgirl.com // www.brandfoundryvc.com
30. The VC Angle: Looking at the Future/Exit…
30
Business Metrics (Strategic)
• Assets. Strategic investors/buyers
will look for key synergies that
your startup will have with their
businesses. They can swallow debt.
• Team Traction. This is different
from venture as it refers to a focus
on strength at the top.
• BRAND. Again, goes with growth!
The End of the Road…
• IPO/Secondary Market. The strong
traction over the holding period
encourages investors to get
involved with team’s next venture.
• Strategic Sale. This is trickier as it
depends on what’s next for each
core member of the team.
Business Metrics (Venture)
• Financials. It’s not so much about
profitability here (varies by sector)
but more about relative hockey-
stick growth on various levels.
• Team Traction. Cohesive teams +
strong hires with experience =
excited new investors!
• BRAND. Goes with growth!
As you as startups hit the annual milestones, most venture capital firms have an average holding
period of 5 years. We have to look at the future, whether it’s selling shares in the secondary market,
going through the IPO, or finding a strategic buyer.
The difference here versus before is that the milestones that both venture and strategic (e.g., large
corporate) investors look at can differ. It also comes back to why user growth traction matters.
www.digishopgirl.com // www.brandfoundryvc.com
31. How Do I Get My LTV?
www.digishopgirl.com // www.brandfoundryvc.com 31
32. Loyalty
• How do I attain/optimize my LTV?
• Retaining an existing user is much cheaper than acquiring a new one
• Value of the 1st purchase is usually just a small fraction of LTV
www.digishopgirl.com // www.brandfoundryvc.com 32
33. Here are some useful resources for you all to peruse:
1. Steve Schlafman: Raising Seed Capital - http://bit.ly/RaisingSeedCapital
2. Des Traynor: Getting user feedback on your product - http://bit.ly/UserFeed
3. Buffer: The investor presentation that earned $500k - http://bit.ly/BufferPrez
4. Ben Horowitz: When to sell your company - http://bit.ly/HoroSell
5. A Founder’s Notebook: Basically all of it - http://bit.ly/FoundersNotebook
6. Ecommerce CAC - http://www.forentrepreneurs.com/ecommerce-cac/
7. Optimizing the Cost of Customer Acquisition: Modeling Metrics to Drive Startup
Success - http://soundbytes2.com/2014/03/26/optimizing-the-cost-of-customer-
acquisition-modeling-metrics-to-drive-startup-success/
8. LTV/CAC - http://kellblog.com/2014/07/30/the-ultimate-saas-metric-ltv-cac/
9. The Complete Quantitative Guide To Judging Your Startup -
http://techcrunch.com/2014/01/31/the-complete-quantitative-guide-to-
judging-your-startup/
33
Resource Library
www.digishopgirl.com // www.brandfoundryvc.com
34. Thank you all for joining us!
If you have any suggestions on what has worked for you,
please let us know!
If you have any questions, feel free to e-mail us:
katya@digishopgirl.com
sumeet@brandfoundryvc.com
34
Q&A
www.digishopgirl.com // www.brandfoundryvc.com