Growth Model Building
Definition
Creating quantitative models that map the relationships between inputs like traffic, conversion rates, and retention to predict growth outcomes.
Why It Matters
Key Takeaways
- 1.Growth Model Building is a core concept for modern business and technology strategy
- 2.Practical application requires combining theory with data-driven experimentation
- 3.Understanding this concept helps teams make better technology and growth decisions
Real-World Examples
Applied growth model building to achieve competitive advantages.
Growth Relevance
Growth Model Building directly impacts growth by influencing how companies acquire, activate, and retain customers.
Ehsan's Insight
A growth model is a spreadsheet that connects your inputs (marketing spend, product changes, hiring) to outputs (revenue) through measurable conversion rates at each stage. The minimum viable growth model: visitors → signups → activated users → paying customers → expanding customers, with conversion rates and growth rates at each stage. The model answers the critical planning question: "If we want to reach $10M ARR in 12 months, what needs to be true at each stage?" Working backwards from the target reveals which conversion rate improvements have the highest leverage. Build this model in an afternoon. Update it monthly. It will inform every resource allocation decision for the next 12 months.
Ehsan Jahandarpour
AI Growth Strategist & Fractional CMO
Forbes Top 20 Growth Hacker · TEDx Speaker · 716 Academic Citations · Ex-Microsoft · CMO at FirstWave (ASX:FCT) · Forbes Communications Council