20Growth The Biggest Lie in Startup Growth and Marketing, Why You Do Not Need To Diversify Customer Acquisition Channels in the Early Days & When and How To Build Your Growth Team with Rob Schutz, CoFounder and Chief Growth Officer @ Ro

Summary Notes


In this episode, Harry Stebbings interviews Rob Schutz, Chief Growth Officer and co-founder at Ro, a healthcare technology company focused on patient-centric care. Rob shares insights from his extensive experience in user acquisition, discussing his journey from starting a daily deals website to scaling BarkBox and ultimately co-founding Ro, which has reached a valuation of $5 billion. He emphasizes the importance of product-market fit, the strategic use of growth tactics like email marketing, and the necessity of cross-functional collaboration for successful growth initiatives. Rob also highlights the significance of aligning growth with company goals and the CEO's narrative. Additionally, he touches on hiring growth teams, advocating for a hands-on approach by founders, and stressing the value of onboarding and building internal relationships. Throughout the conversation, Rob's approach to growth is marked by a willingness to take calculated risks and learn from both successes and failures.

Summary Notes

Introduction to Rob Schutz and Row

  • Rob Schutz is the chief growth officer and co-founder at Row, a healthcare technology company.
  • Row has raised over $870 million with a reported valuation of $5 billion.
  • Under Rob's leadership, Row has become one of the fastest-growing companies in the country.
  • Rob's previous roles include VP of growth at Bark (BarkBox) and founder of a daily deals site.

"He's scaled multiple brands to $100 million plus in revenue and is the alltime OG of user acquisition."

This quote highlights Rob Schutz's success in scaling companies and his expertise in user acquisition.

Rob's Early Career and Entry into Startups

  • Rob began his career in growth after leaving healthcare consulting in 2000.
  • He started a daily deals website with a friend during the era when such sites were popular.
  • Rob and his friend built their business with limited funds, relying on cost-effective growth strategies.
  • They used creative methods to grow their email list, such as hosting free happy hours.

"We didn't really have money. We raised VC from Bank of mom and dad, really had to figure out how to grow that business without any money, and relying on super cheap or free ways to kind of build a list."

This quote explains Rob's initial approach to growth, which involved using inexpensive methods to build an audience due to limited funds.

Growth Tactics and Marketing at the Daily Deals Site

  • Rob and his team focused on partnerships and building an email list as they had no experience with performance marketing.
  • They leveraged slow nights at bars to host events that grew their email list.
  • The company was eventually sold after Groupon filed for an IPO.

"It was a good way. We had other partnerships. We were able to build out this list and slowly started to learn about email marketing and search, right? And partnerships."

This quote emphasizes the importance of partnerships, email marketing, and learning on the job as key factors in the company's growth.

Transition to BarkBox and Growth Strategies

  • Rob joined BarkBox as the first person dedicated to growth.
  • He was instrumental in launching Facebook newsfeed ads, which were new at the time.
  • At BarkBox, Rob built a team and learned about combining performance, data, creative, and analytics.

"Really the first person to come in and think about how do we grow this as a business?"

Rob discusses his role at BarkBox, highlighting his responsibility for conceptualizing and executing growth strategies.

Impact of BarkBox Experience on Role at Row

  • Rob's experience at BarkBox provided valuable lessons that he applied at Row.
  • He learned the importance of blending aggressive paid channel work with cost-effective growth strategies.
  • Rob's approach to growth involves a focus on creative, testing, optimization, and leveraging free channels.

"I think I've been able to parlay a lot of those early experiences at bark into what we're doing with row."

This quote reflects on how Rob's previous experiences informed his current growth strategies at Row.

Balancing Paid and Organic Growth

  • Rob believes in focusing on what works, even if it means initially relying heavily on a single channel like Facebook.
  • He advises early-stage founders to exploit effective growth channels before diversifying.
  • Foundational growth strategies such as cart abandonment workflows and "How'd you hear about us?" surveys are essential for all businesses.

"If Facebook is working for you and your LTV to CAC is good and your payback is good, crank it, do it as much as you can."

Rob advises capitalizing on effective growth channels while they are profitable and before market changes necessitate diversification.

The Concept of Healthy Growth

  • Healthy growth, according to Rob, involves attracting people to your platform with a product-market fit.
  • Growth must be sustainable, with customers returning and demonstrating the value of the product or service.

"There has to be product market fit. And so I think that actually, even as you get into thinking about how to hire from the beginning, it's like, do you have something people want?"

Rob defines healthy growth as not just acquiring users but retaining them by offering a product or service that meets market demand.

Growth Leadership and Channel Strategy

  • Growth leadership involves understanding when to scale up marketing efforts and when to focus on product-market fit.
  • Channel diversification (e.g., TV, podcasts, out-of-home advertising) is not a fix for underlying issues with the business or value proposition.
  • Product-market fit and product-channel fit are prerequisites for successful channel expansion.
  • Growth leaders should evaluate business metrics like customer retention and repeat purchases before scaling up spending.
  • Aligning with the executive team on growth strategies is crucial.

"As you think about a growth leader, some of it can understand is what is necessary to dump more fuel on the fire. Is it about channel diversification? Do we go do tv? Or is it actually saying like raising your hand saying I don't think we're there yet on the fit side, let's go back, let's retool, let's think about messaging, let's think about product features and we'll get there on the channel side."

This quote emphasizes the role of a growth leader in determining whether a business is ready to scale marketing efforts or if it needs to revisit its core offering and messaging to ensure product-market fit.

Hiring Growth Talent

  • Early-stage companies should assess traction and might start with freelancers or agencies to validate product-market fit.
  • Hiring specialists in effective channels (e.g., paid search or paid social) is strategic after identifying what works.
  • Growth hires should be opportunistic, seeking the right person rather than rushing to fill a role.
  • Validating channels with external help can guide subsequent hiring decisions and strategy.

"Once you get a sense of what's kind of working, that's a pretty good indicator of what direction to go in."

Rob Schutz suggests that understanding which marketing channels are effective for the company can guide hiring decisions for growth roles, indicating the importance of data-driven decision-making in building a growth team.

Organizational Structure for Growth Teams

  • The structure of growth teams depends on the strengths of existing leaders and the company's needs.
  • Growth can be integrated into marketing or operate as a separate function, depending on the context.
  • Building teams around proven internal talent can be effective.
  • Senior growth hires may require flexibility and the opportunity to work across different functions.

"I think for us we have kind of two separate but equal functions. We have growth, which is more of the performance marketing. They spend the media dollars. Then we have marketing which owns creative, which owns messaging and insights, kind of the who are we speaking to and what are we saying?"

Rob Schutz describes how growth and marketing functions can be distinct yet collaborative within a company, highlighting the importance of defining clear roles while ensuring cross-functional teamwork.

Identifying Exceptional Growth Candidates

  • For channel-specific roles, practical evaluations can reveal candidates' expertise and problem-solving abilities.
  • Senior growth roles require collaboration skills with various company functions.
  • Interviewers should assess candidates' reactions to challenges and disagreements to gauge their collaborative nature.
  • Strong opinions loosely held is a valued philosophy for growth roles.

"You need to test and suss that out a little bit, even through the interview process to understand, is this person going to be good to work with? Are they going to be kind to work with and are you going to be able to get along and get through the inevitable ups and downs that come with building a company."

Rob Schutz emphasizes the importance of assessing a candidate's ability to collaborate and navigate the challenges of company growth during the interview process.

Interview Process for Growth Roles

  • Initial screenings assess candidates' backgrounds and motivations.
  • Subsequent interviews involve team members they would work closely with.
  • Practical assessments test candidates' skills in relevant growth metrics and cross-functional work.
  • Founders or senior leaders often have final interviews to ensure cultural fit and passion for the industry.

"And then from there we'll usually we still have a founder interview everyone that joins the company. So the founder in this case would be me. I'd review the practical. I'd spend a little bit of time with them and make sure that they've got a passion for the space for healthcare and a culture ad, which is important."

Rob Schutz describes the final stage of the interview process, which includes a founder's assessment of the candidate's fit with the company's culture and mission.

Reference Checks and Candidate Character

  • Asking about candidates' past failures can reveal their attitude towards risk and learning from mistakes.
  • A candidate's comfort with failure and humility are important traits for growth roles.
  • Understanding a candidate's character is as important as assessing their professional skills.

"I love to ask people about their failures. I love to say, tell me about a project that completely blew up, that looking back like you are not proud of."

Rob Schutz highlights the value of discussing failures with candidates to understand their resilience and ability to learn from past experiences.

Understanding the Value of Failed Marketing Strategies

  • Rob Schutz views unsuccessful marketing strategies as a form of 'paying for education.'
  • The idea is that by identifying what doesn't work, teams can focus their efforts more effectively.
  • It's essential for team members to recognize the value of quickly learning where to allocate time and resources.

"It's not failure. It's actually like getting to an understanding of where you should spend time and where you should not spend time more quickly."

  • This quote emphasizes that what might be perceived as failure is actually a valuable learning experience that helps prioritize future marketing efforts.

Identifying the Right Time to Abandon Marketing Efforts

  • Rob Schutz uses the metaphor of spreading peanut butter to describe the allocation of marketing resources.
  • He recounts his experience with TV advertising, where a small budget over six months didn't yield conclusive results.
  • Schutz advocates for committing to a few substantial tests per quarter to avoid the trap of half-hearted attempts that lead to uncertainty.

"You've only got so much peanut butter you don't want to spread it so thin that at the end of the exercise you don't even know what you got."

  • The peanut butter metaphor illustrates the importance of not spreading resources too thinly across too many channels, which can lead to inconclusive outcomes.

Conducting Post Mortems for Marketing Campaigns

  • Rob Schutz discusses the importance of conducting post mortems for both successes and failures.
  • The process involves gathering input asynchronously on what worked and what could be improved, followed by a collaborative review to identify common themes and actionable insights.

"We do post mortems preregularly both for things that went great and things that did not go great. We call them our blameless autopsies."

  • This quote highlights the routine practice of analyzing outcomes, both good and bad, in a constructive and non-judgmental manner, which Rob Schutz refers to as "blameless autopsies."

Hiring Senior Growth Leaders

  • Rob Schutz describes the competitive nature of hiring senior growth personnel.
  • The initial interactions often involve selling the vision to potential candidates to pique their interest.
  • A structured interview process follows, which includes meetings with potential team members and cross-functional peers.

"It is a competitive market for senior growth folks."

  • Schutz acknowledges the challenge in attracting top talent for senior growth positions due to the competitive job market.

Onboarding Growth Team Members

  • Rob Schutz believes the first few weeks of onboarding are critical for new hires to build relationships and understand the business.
  • He advises against pressuring new hires to make significant changes too quickly, allowing them to absorb context and establish cross-functional relationships.

"I try to encourage folks to give these new hires as much space as possible to truly onboard."

  • The quote suggests that new team members should be given the space and time to familiarize themselves with the company and its people before taking on substantial responsibilities.

Evaluating New Growth Team Members After One Month

  • Rob Schutz outlines his expectations for a new growth team member after one month, focusing on relationship building and understanding the business's current state.
  • He details a 30, 60, 90-day plan with clear expectations for new hires, starting with integration into the company culture and progressing towards more substantial contributions.

"I'm just that big believer in one building cross functional relationships and then a high level audit of kind of like, what is going on?"

  • Schutz emphasizes the importance of new hires building relationships across the company and gaining a high-level understanding of its operations.

Recognizing Red Flags in New Hires

  • Rob Schutz introduces the concept of "startup stomach," referring to a candidate's ability to handle the uncertainties of a startup environment.
  • Red flags include an inability to cope with ambiguity or expecting the structure and resources of a larger company.

"Is this person at your early stage company in a position to be able to thrive in that environment?"

  • This quote underscores the importance of assessing whether a new hire can adapt to and flourish within the unique challenges of a startup.

Fostering Cross-Functional Communication and Collaboration

  • Rob Schutz stresses the importance of having a common North Star for aligning cross-functional efforts.
  • He describes how OKRs (Objectives and Key Results) set at the company level can help different teams align their goals and work collaboratively.

"If your incentives are not aligned and you're not working towards a common set of goals, there is always going to be inherent friction."

  • Schutz points out that misaligned incentives can cause conflict, implying that shared goals are crucial for cross-functional harmony and productivity.

Communicating the Collective Responsibility for Growth

  • Rob Schutz talks about the need to convey to the entire team that growth is a collective responsibility, not just the purview of the growth team.
  • He ties this back to the idea of common goals, suggesting that all departments should consider growth objectives in their work.

"There should be new member goals that the design team is thinking about and new member goals that engineering is thinking about that."

  • This quote reinforces the concept that growth should be a consideration for all teams within the organization, not just those directly responsible for growth initiatives.

Alignment and Cross-Functional Teamwork

  • The success of a company's goals relies on cross-functional teamwork and alignment.
  • It is crucial for all team members to be aligned around common goals and track progress.
  • Regular check-ins are necessary to ensure that goals are being met and to make adjustments across different areas if needed.
  • The importance of alignment extends to understanding when changes in strategy or focus are necessary.

"Yes, it is a team sport. It is not somebody goes off in a corner and rips Google search campaigns and everyone's job is done."

This quote highlights the need for teamwork and collaboration in achieving company goals, rather than individuals working in isolation.

"Having folks aligned, I think is the number one thing you can do there."

This quote emphasizes that alignment within the team is the most important factor in successfully reaching company objectives.

CEO and Head of Growth Relationship

  • The relationship between the CEO and the head of growth or growth team member is dependent on the company's structure.
  • Clear alignment around goals and company narrative is crucial regardless of reporting lines.
  • Continual discussions are necessary to ensure that growth metrics align with the company's narrative, especially when fundraising or investing.
  • Regular check-ins, whether weekly or monthly, are vital for maintaining alignment and addressing issues.

"There needs to be, regardless of who that is, there needs to be really, really clear alignment around goals and company narrative."

This quote stresses the necessity of having clear, shared goals and an understanding of the company's narrative between the CEO and growth teams.

CEO's Communication with Growth Teams

  • CEOs sometimes have unrealistic expectations of the growth team's ability to meet specific metrics perfectly.
  • Understanding the context behind why certain metrics may not be met allows the CEO to better explain deviations from plans.
  • Open and constant communication between the CEO and growth teams is essential to address and overcome challenges, such as changes to iOS 14 affecting paid social campaigns.

"I think there is an expectation sometimes that a growth team can land the plane perfectly every time."

This quote points out the common misconception that growth teams can always hit their targets without fail, which is not always realistic.

Growth Decisions Without Data

  • Growth decisions are sometimes made based on intuition rather than hard data.
  • An example provided is Roman's partnership with Major League Baseball, which was based on a perceived demographic overlap rather than concrete data.
  • The partnership has been successful, demonstrating the benefits of taking calculated risks.

"We didn't have that hard and fast data that said, roman logo plus major league baseball logo equals 15% increase in conversion."

This quote illustrates the situation where a decision was made without definitive data but was based on a strategic hunch that proved to be successful.

Quickfire Round: Growth Strategies and Tactics

  • Email remains an important channel despite predictions of its decline.
  • Organic social reach on platforms like Facebook has diminished significantly.
  • Founders often make the mistake of seeking channel diversification too early when they should focus on finding what works first.
  • Growth teams can fail if they do not have proper tooling and attribution to understand the efficiency of their spend.
  • Growth should be recognized as a team sport, requiring collaboration from various departments.
  • Calm's sponsorship of CNN's 2020 election night coverage was highlighted as an impressive growth strategy.

"Email is still an incredibly important channel."

This quote reinforces the continued relevance of email in marketing strategies despite the evolution of other channels.

"Organic social reach. Do you know anyone who's crushing it on a popular Facebook page these days?"

This quote reflects the decline of organic reach on social media platforms, suggesting that this tactic is no longer effective.

"Diversification is a rich person's series, a type of problem."

This quote suggests that early-stage companies should focus on what works before diversifying their growth strategies.

"The channels are only as good as you can track against them."

This quote emphasizes the importance of having the right tools and data to measure the effectiveness of marketing channels.

"That's something I've been talking more about. But creative product insights, engineering. Everyone has to band together to actually make growth work."

This quote highlights the collective effort required from all departments to drive growth effectively.

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