What's New: Growth marketing best practices

(from the latest issue of the Indie Hackers newsletter)

Three fundamental questions can help you craft a successful marketing plan:

• Who are your happiest users? How did they find you? What alternative to your product could they use? Strategize around the answers.
• If you're building a marketplace, find early adopters, build a community flywheel, and invest heavily in platform integrity to boost user trust.
• Benjamin Katz went all-in on stock options in a risky move, but it paid off. He now has several years of runway, and is currently doing a 12 x 12.

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Growth Marketing Tips 🚀

by Oba

Asher King Abramson is a very experienced growth marketer, and I've gathered some of his top tips. I hope these will benefit other indie hackers!

Three fundamental questions to ask yourself

When thinking through your marketing plan, consider these key questions:

1. Who: Who are your happiest users?

2. How: How did they find you?

3. Why: What would their alternative be if they didn't use your product? The answer here comprises much of what you need to know to iterate and improve your product.

Different growth paths

Companies in the same industry can grow in different ways. For example, one coding bootcamp grew through content and SEO, while another grew through press, then cracked Facebook and Instagram ads.

There is no singular path to building a successful business. Growth marketing is not one-size-fits-all. Don't be afraid to experiment to find things that complement and benefit your business, regardless of what other marketers are doing.

Speed of iteration

The fastest growing companies are those that can iterate quickly. They focus on the 80/20 rule, getting 80% of the gains with 20% of the work.

Get a wide range of results by trying very different channels and ideas.

Unconventional methods

Sometimes, unconventional methods, like billboards or guerrilla marketing, can be surprisingly effective and cost-efficient.

Asher shared specific examples in the recordings.

Hiring for growth

When hiring for a growth role, look for candidates who are able to 80/20 tasks, and who ask clarifying questions to fully understand what the expectations are.

These qualities are key for a high-potential growth marketer.

You can check out the full interview here!

Discuss this story.

In the News 📰

from the Growth Trends newsletter

💰 Instagram ad spend is projected to surpass Facebook in the next year.

🔗 SEO link building: Best practices for building quality backlinks.

🛠 How to test Meta conversion events.

💻 Automating tech needs with ease. #ad

📅 Here's how often you should refresh your content.

👶 New parents are paying to get their babies social media-ready.

Check out Growth Trends for more curated news items focused on user acquisition and new product ideas.

Building a Marketplace 🛍

from The Hustle newsletter

Marketplace builders are familiar with the chicken and egg problem of supply vs. demand. Uber and Airbnb built their supply side first, while Zillow and TaskRabbit focused on demand.

But how do you determine where to start when building a new marketplace?

Ben Stokes confronted this problem when he created AI prompt marketplace, PromptBase, and spent nine months building up the supply side. In 18 months, PromptBase amassed 160K+ users, 20% of whom were sellers. Here's how Ben did it.

Find early adopters in the right channels

For nascent industries, it's key to connect with people who are early in the game.

Find out where your potential market hangs out. These folks will help validate your initial product, or become early adopters.

Ben found his first batch of sellers via Reddit. He posted a grid image of 3D icons, created with prompts he designed in r/dalle2:

His post was a hit, garnering 1.3K upvotes, and stirring curiosity about the prompt.

So, Ben dropped a link to PromptBase, bringing ~700 unique visitors to the platform. Then, a TechCrunch reporter picked up the story, which brought 2K+ unique visitors to PromptBase in one day.

Many of r/dalle2's 170K subscribers are AI aficionados who experiment with prompt engineering. When they saw a way to monetize their hobby, they jumped on board.

Ben also identified sellers on Fiverr and Etsy who made AI-generated art. These marketplaces aren't made for AI prompts, so he convinced them to try out PromptBase.

Build a community flywheel

Once Ben got the initial surge of supply, it was a matter of building a trusted seller community and relying on word-of-mouth.

He focused on polishing and curating the initial submissions so they would look attractive to buyers, sprucing up the thumbnail images and correcting spelling mistakes.

Early sellers who made decent cash were happy to share with their network, attracting other sellers to PromptBase. The flywheel effect took off.

As the community grew, he started featuring AI artists on PromptBase's social media channels. These artists would often repost and spread the word.

Maintain platform integrity

With any marketplace, the supply quality determines whether demand takes off. Set up guardrails so bad players don't infiltrate your platform.

Ben says the biggest challenge in scaling PromptBase was maintaining prompt quality and avoiding exploitation, so he established a strict prompt review process:

1. Review all listings with an AI moderation tool.

2. Use a filter to instantly eliminate bad listings.

3. Use a real person to review the remaining listings, and provide detailed instructions to improve them.

Retain and reengage sellers

Ben got a head start, but similar marketplaces started showing up. To maintain PromptBase's edge, he needed to constantly evolve it to better serve and retain sellers, doing things like:

• Shipping new features fast: Ben drops new features to optimize the seller experience. He recently turned the seller profile page into a prompt store builder, where sellers can customize how their "stores" look.

• Constantly engaging with users: Ben uses emails and in-app notifications to remind users that exciting things are happening at PromptBase. He also celebrates seller milestones (i.e., first 10 sales) with a personal DM.

Supply-side success secures marketplace momentum!

Subscribe to The Hustle newsletter for more.

These Metrics are Center Stage for Investors 💡

This issue is sponsored by Mercury

Startups looking to fundraise in today’s market should be laser-focused on these key metrics to land the funding necessary to realize their ambitions. We shine a light on the numbers investors have their sights set on in this article.

A Risky Move Paid Off Big Time 💵

by James Fleischmann

Benjamin Katz put everything he had into stock options. It was risky, but now, he's living on his own terms.

Be greedy when others are fearful

When he was working full-time at a startup, and the opportunity to exercise stock options came along, everyone told Ben to put his money into a house, instead; startups were too risky.

But he knew he might not get another chance like this, so he drained his entire bank account and exercised 100% of his stock options.

A few years later, he got a huge return when the company unexpectedly announced its IPO.

12 startups in 12 months

Ben's mental health began to suffer while working full-time at the startup. He was struggling to get out of bed most days. After a particularly long week of meetings, he woke up and realized he didn't want (or need) to do it anymore.

He already had several years of runway saved up, but he knew that it could take years to find product-market fit.

Since he didn't have a side hustle when he quit, he's doing a 12 x 12 to see what sticks. He just launched IP Sync. Before that, it was Simple OTP, Dynamic Duo, and Print Swarm.

His revenue so far? $5 MRR.

The numbers

• Revenue: $5 month (from Dynamic Duo).
• Bond payments (fixed): $1.5K+ per month.
• Stock dividends (average): $1.2K+ per month.
• Bank interest payments: $317 per month.
• Personal account: $75K.
• Business account: $250.

To cover his expenses, he withdraws from his investment portfolio once per year. He uses the 4% rule when withdrawing money from his stock portfolio, though he tries to spend even more conservatively than that.

Personal expenses:

• Rent: $3.2K per month.
• Utilities: $150 per month.
• Food and entertainment: $1.4K.

Extending runway

Ben is prepared to do whatever it takes to extend his time building businesses, including leaving the US.

He applied for a residence visa in Thailand, where he could lower his living expenses by roughly 70%. But, as of this week, Thailand has changed its income tax rules, so it may not work out.

Digging deeper

Ben keeps business and personal funds separate for legal liability reasons, and to make accounting easier.

He formed a holding company as an LLC, which is ideal for him since he's experimenting with several business ideas. When a new product is expected to make money in the near future, he sets up a DBA (doing business as) under the LLC.

This setup provides legal protection, and allows him to file just one set of tax forms each year.

Ben mostly invests in stocks and bonds. For stocks, he invests primarily in Vanguard total market ETFs. For bonds, he invests in US government bonds and small business loans. It's fixed, passive income with tax benefits.

5% of his portfolio is in crypto (even split of BTC, ETH, and LTC), and 5% is in angel investments.

Discuss this story.

The Tweetmaster's Pick 🐦

by Tweetmaster Flex

I post the tweets indie hackers share the most. Here's today's pick:

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Special thanks to Jay Avery for editing this issue, to Gabriella Federico for the illustrations, and to Oba, Darko, Cyan Zhong, and James Fleischmann for contributing posts. —Channing