Sean Ellis

Natural word of mouth was huge with LogMeIn.

So by the time I left LogMeIn, 80% of our users were coming in through word of mouth.

But we were spending more than a million dollars a month, three months payback on acquiring customers.

But this is where I was saying that value drives word of mouth.

And word of mouth is...

really more powerful as an acquisition loop than incentivized referrals.

So we spent most of our time at LogMeIn just making sure when we first tried to grow the business, majority of people who signed up for the product never actually used the product.

And so we spent a lot of time understanding why did you sign up and not download the software?

Why did you download the software but never do a remote control session?

When we had those insights, we ran a ton of experiments to get more people through.

And it was really about unlocking acquisition as a channel.

I'll give you a specific example there.

I initially tried to grow it and couldn't grow more than $10,000 a month, couldn't spend more than $10,000 a month growing the business because we had such an inefficient funnel.

I lost money every time I tried to expand beyond that $10,000.

But once we as a team all worked together, so the CEO really got each of the disparate parts of the business across that customer journey to work together and experiment all the way through that customer experience, we got about...

10x improvement in the number of people who sign up and actually use the product, and

That led to obviously a lot more revenue, but that also unlocked all the word of mouth.

And so as soon as we made that change, it took us about two or three months to make that change.

I now went back to the same channels that scaled to 10,000 and they scaled to over a million dollars a month in my ability to spend to grow that business.

And it was unlike most VC backed businesses.