You ought to experiment with paid growth before you hit your organic ceiling

Your startup’s organic growth will always have a mind of its own. Here’s why investors want to see you experiment with paid growth as early as possible.

When startup founders pitch me for investment they often proudly tell me about how many customers they’ve acquired through various forms of organic growth — word of mouth, online reviews, organic social and SEO, etc. And if those numbers are impressive, I’ll be duly impressed. But I may not be very excited.

Evidence of organic growth is helpful when I’m trying to get a sense for product-customer fit, but does nothing to validate the commercial model and nothing to indicate how much faster the startup could grow if investors like me provide capital to spend on paid marketing.

Organic growth is something which is out of your control. By definition, it grows as fast as it wants to grow. If it has a ceiling to it, there’s often not very much you can do to raise it. Sometimes you can find levers to make organic growth accelerate for a while, but there will always be a ceiling at which churn equals acqusition.

The sooner you can start to experiment with paid acquisition, the sooner you can validate the “CAC” (cost to acquire a customer) assumptions you have in your commercial model, which you have to account for in designing your pricing and operational expenses.

Perhaps more importantly, with the backing of investors prepared to fund paid marketing and advertising, it means you’re actually in control of how fast your startup grows; how fast you outgrow your competitors, and whether you’re able to target your ideal customer profile or just whoever happens to be reached by your organic channels.

Upshot: I’m stoked to hear about early experiments with simple and cheap channels of paid acquisition, even if they’re off a small monthly spend.

Ben Radcliffe and I talked more about this, and also about opening your pitch with a sharp, clear, buzzword-free intro, offering concrete examples of founder achievements, clarifying your go-to-market strategy, and outlining the pricing model.

Watch or listen to the latest episode of my founder advice podcast Pick My Brain here.