On Starting a Software Business
I have a question regarding startup growth so I apologise in advance if its irrelevant here (haven&#x27;t read the article to be honest).<p>1) I get that to get the first users, you have to go out and recruit them. That&#x27;s the advertisement part. So yeah, I get how you get users by advertising.<p>2) I get that when you have a million customers, they become the advertisement and they are the ones who are bringing you new customers. Your product &quot;ad surface&quot; is <i>way</i> bigger than simple banners through them.<p>Now what I have a hard time to understand is how 300 users procures the same effect as 2) (or even 3000). I get that they gonna get you 30 more customers by talking about your product to their &quot;friends&quot; who, if everything goes fine, at their turn gonna bring you 3 more customers who gonna bring you 1 more customers, for a grand total of 34 more customers. And that&#x27;s the end of it. That wont grow much bigger. So basically, you would have to go back to 1) to get new users.<p>What am I missing? Does a user have to bring you n more new customers, n &gt; 1? How many customers do you need via advertising so that the compound growth effect kicks in?<p>edit: I can see actually 2 types of compound growth effects: a) a user explicitly recruit another user (ex: &quot;hey my friend, come play to this game&quot;), b) a non user &quot;see&quot; other people using the product and he tells himself that might be a good idea to try it.
Anyway, so basically, what I see is that, early on, you can rely only on a) so, in average, your customers have to get you n more new customers, n &gt; 1, by explicitly recruiting them for you. Which, if Im correct here, would give an idea how badass the product must be.