HubSpot’s Kieran Flanagan on product-led growth

While most marketers focus on external acquisition channels to drive demand, Kieran Flanagan looks to the product and ways he can build viral loops into the product to drive faster adoption.

That doesn’t mean his team overlooks traditional approaches; rather, they’re deploying a blend of tactics to create products with true, measurable value so powerful that it wows users and drives growth.

Though he’s now HubSpot’s VP of Marketing and Growth, Kieran has seen it all. He joined in 2013 (when there were only about 300 global employees) with the mandate to grow the company internationally. From there, he created HubSpot’s freemium, go-to-market product, before moving into his current role. In his spare time, he also hosts his own growth-focused podcast, called The Growth TL;DR.

Kieran joined me for a chat that covered everything from how to determine when product-led growth is right for your company to why it’s important to measure growth through a north star metric.

Short on time? Here are five quick takeaways.

1. Product-led growth generally is a good fit for companies that have a freemium option or a free trial. In a sales-led model, a salesperson needs to pitch the product.
2. You’re probably familiar with product-market fit (determining the group of people who will become your customers). But product-channel fit is the idea of designing your product to inherently take advantage of the way big platforms like Google drive traffic.
3. Kieran tracks three stages of growth: a) creating the initial (sometimes chaotic) growth team, b) centralizing growth into a best-in-class team and c) democratizing growth across the product team by building processes and tools.
4. The best way to measure growth is to use a north star metric. Look for the users who are upgrading and retaining, because that’s what shows you they’re getting true value from the product.
5. Kieran’s career advice: do what you’re passionate about (because you’re more likely to be good). And don’t chase titles; be strategic about earning experience and equipping yourself with skills instead.

If you enjoy our conversation, check out more episodes of our podcast. You can subscribe on iTunes, stream on Spotify or grab the RSS feed in your player of choice. What follows is a lightly edited transcript of the episode.

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Amanda: Kieran, welcome to the show. Tell us about yourself and your journey to HubSpot.

Kieran: Thanks for having me. I’m really excited to be on your podcast; it’s one of the ones I listen to all the time. My journey is basically this: I work for HubSpot. HubSpot are a platform company. We have a suite of tools that help marketers, sales, customer service people, and grow companies.

I joined HubSpot at a very interesting time when we were about 300 people globally, way back in 2013. And I specifically joined a group of 12 people who had the mission of growing HubSpot internationally.

We were the first group of people who joined outside of Cambridge. I did that for two and a half years, and it went really well, thankfully. Then I started another journey within HubSpot. I joined a small group of people who had this mission to create a freemium, go-to-market product for HubSpot.

I did that for another two and a half years. And a year ago, I changed roles again. Now, I manage all of our different teams who generate global demand for HubSpot. That’s end users and leads.

The interesting thing about HubSpot is that 100% of our revenue comes from demand the marketing team creates. We don’t do any cold calling or any things like that. And that has been my journey and my experience at HubSpot to date.

A product-led approach to growth

Amanda: HubSpot’s growth has been phenomenal. From your years of experience there, what do you think the key drivers behind that growth have been?

Kieran: There are a couple of things. One of the important decisions HubSpot made early on was to really focus on SMBs in mid market. What typically happens to tech companies is they start off maybe in mid market, and they decide very quickly to go to enterprise.

We didn’t want to do that, because we felt the mid-market SMBs were underserved and didn’t have really great tools to help them to grow their businesses. That was a good decision.

Over the years, we’ve been stretched up market as our customers have grown and we’ve tried to grow with them. And our tech has gotten a lot better for bigger companies. We’re also good at inbound marketing, it turns out, so that has been pivotal to our success. That’s what helped us to grow.

“Launching new products is a big part of how you grow”

The international aspect was really successful for us and really helped us to grow a lot faster. And then we risked a lot to disrupt our own go-to-market by creating this freemium model that allowed people to try our software and extract value from our software before they ever had to pay us a dollar.

That’s where software is going in the B2B space and it turns out that was a pretty good decision.

Then like any company (I’m sure Intercom are similar), launching new products is a big part of how you grow because you create new S-curves and U-growth curves that are great for new audiences, great for increasing revenue, things like that.

Amanda: It strikes me that your approach to marketing and growth is very much driven by the product compared to a lot of other marketers. While most marketers think about external acquisition channels, you seem to think about the ways you can build viral loops into the product or improve other aspects of it to drive faster adoption. Where do you think this product-led approach to growth came from?

Kieran: Yeah, I’m interested in all types of marketing. The reasons I’ve written a lot about product-led growth and loops and virality is just because that’s something I’m trying to figure out. I’ve tried over the last couple of years and generally my writing reflects the thing that I am trying to understand at that point in time.

Product-led growth is interesting to me because what we’re seeing in the B2B space is that consumers want to experience B2B in the same way they experience B2C. And that means that they are able to interact with your product before they ever have to pay you a dollar – that they have some type of frictionless experience with how they want to pay you money and use that product on an ongoing basis.

“Consumers want to experience B2B in the same way they experience B2C”

It’s interesting to think about how does the product itself sustain its own growth? And how does it attract people towards it? How does the product actually acquire new users for itself and onboard people into the value of that product in a really short amount of time? And how does that product provide monetization paths and upgrade people into paying customers?

This is an important trend that we see in tech and something that is going to continue.

Amanda: When do you think it makes sense for other teams to take a product-led approach to growth? What conditions do you think they need?

Kieran: The first thing is that your customers have to generally be interested in experiencing your product in that way. Product-led growth generally is a good fit for companies who have a freemium option or a free trial.

Because in a sales-led model, you have a product that needs to be explained through a sales person or a sales interaction. But in a product go-to-market, you are allowing the product to do a lot of that job for you.

You first of all have to think through, “Is this how my customers want to experience my product?” There are a lot of companies that may have a very complex product that needs a salesperson to bring people through it, to demo it. And that’s a better fit for a sales go-to-market.

“In a product-led strategy, you need a product where it’s easy to understand the value”

The other thing you need in the product-led strategy – and there’s probably lots of definitions of what product led growth is, so I’m just giving you mine – is a product where it’s easy to understand the value. Because you want to get the user to experience that value and then spread that value within their networks. And you need to be able to onboard that person to the core value proposition of this product. And it doesn’t take a lot of explanation. That’s really important.

Then you need to be able to have mechanisms within your product that allow people to actually upgrade to a paid model. You need to be able to figure out the triggers, what should be in your free plan versus what should be in your paid plans. Generally in our industry, it started pro-enterprise.

There are a lot of variables that go into dictating whether a product-led model is the right model for you or you’d be better served to have a sales model.

But the reality is there’s no right or wrong answer to this. Most companies have hybrids. We have a hybrid: we have a freemium go-to-market, but a lot of our revenue come through leads that sales interact with and talk to. They’re created by inbound demand. There’s many, many companies that have hybrid models.

Defining product-channel fit

Amanda: You’ve also written a lot before about product-channel fit. Can you explain what product channel fit means and why is it so important?

Kieran: This is really part of trying to figure out that product-led growth strategy. Product-channel fit is something Brian Balfour, the CEO of Reforge, wrote about. And it’s a really good way to think about acquisition of users and how you’re going to grow your company and your product in the very early stages of when you are creating that product.

When most people at startups think about the early journey, they’re thinking about product-market fit and the right groups of people to actually use this product. Can I get them to use it? And can I get a certain percentage of those to actually retain over time? Your product-channel fit is similar to that in that you are, in the very early stage, thinking about how does my product fit with these different platforms and channels – and how is it going to acquire growth from those channels?

To give you an example: if you distill marketing down and make it very, very simple, there are only a few platforms you can actually grow from that will give you sustainable growth.

There’s Google, right? It has a lot of huge audience. You can extract a lot of users from Google. You can do that through platforms like Facebook that have a big audience, if your product is a good fit for them.

Then you have some means of virality. And virality is broken into engineered virality, where your product exposes itself to other people and a percentage of those people are going to see the product and maybe sign up for it.

“Acquisition should be built into your product”

And then there’s just word of mouth about your product: it’s very easy for that person to understand and they can spread that within their network. Very early on, you can think about how to build your product in a way that fits those channels.

A great example of this is a company that used to be called Rap Genius (which catalogs music lyrics, especially rap). Being from Donegal in Ireland, I’m obviously into a lot of hip hop music, it’s a natural fit.

They’re called Genius.com now, but when they were growing, it was a very competitive space for rap lyrics. They have this huge database of lyrics, and you can go and search for any song. They created a feature that allowed their audience and people who signed up to add commentary to all of these different lyrics and tell you what they’re about.

And by doing that, they created this loop where you would have users sign up and create user-generated content that would enrich their pages. Their pages would be more valuable and rank better in Google. And then, because they rank better in Google, more users would sign up and it’s like a virtuous loop.

That’s one good example of how a company could see value in building their product into Google and extract more users from it.

As a company, acquisition shouldn’t be an afterthought; it should be actually built into your product.

Amanda: How have you done that at HubSpot?

Kieran: At HubSpot, we have a couple of different product-channel fits. One is just Google, and when you approach Google, there are two avenues you can take. There’s appearing for the things you do, and there’s appearing for the things you solve.

Appearing for the things you do is really a transactional kind of search. Someone’s searching for – maybe in Intercom’s case – live chat or customer service. It’s the thing you do, and you want to make sure you’re visible for it.

Then there are all of the problems your product can solve – that you can educate people on before they’re even aware of you as a company or aware of you as a product, right?

For HubSpot, we were able to educate people just about how to be better marketers, and they didn’t know what our product was. It turns out that was a good challenge for us, because we could create a lot of demand with educational content around that. Naturally, those people would then go on to sign up for our product.

To give you a counter example, when we launched our freemium CRM, that was not a good fit for that good product, because people are either going to adopt a CRM or not. You couldn’t educate them on the things a CRM would solve and then convince them to change their CRM or try different CRM.

A lot of our time was just spent appearing for transactional keywords – like when people were in the buying process, we made sure that we were visible everywhere you could be visible. So we take it product by product and try to figure out when we are creating that product, what’s the right channel to put it in, and we build our marketing playbook around that.

Amanda: Have you ever made a mistake when it comes to product-channel fit?

Kieran: Yeah. When we first created freemium, we spent a lot of time trying to replicate that inbound playbook for freemium and working with influencers. And I think that’s all good stuff, because it actually did get us a lot of brand recognition. But we did figure out that in the freemium space, the content to set up your portal to upgrade didn’t work as well as it did in the marketing space where we had people create leads and sign up to our marketing product.

We definitely learned a lot about freemium in those early days where we tried to just replicate one playbook that was working for a different go-to-market or a different product. For some reason we thought it was going to work with no real changes. And we’ve iterated in that over time.

Baking growth levers into your product

Amanda: How do you work with product teams to bake growth levers into the product? Who is it that identifies these opportunities and drives that roadmap at HubSpot?

Kieran: We’ve gone through the typical evolution every company goes through when they are building growth. If you talk to most companies, there are three stages of growth. You create a growth team, it’s in its infancy and it’s made up of a cross functional team of people that they have some metrics they want to move.

“There are 3 phases when it comes to growth: creation, experimentation and centralization”

There’s like this experimental approach to doing this type of work. And that team frustrates a lot of other teams, because they’re stepping on toes. Everything is in chaos. And through that chaos, you get some wins, right? Something happens and you’re like, “Oh, this thing actually did work, and we can see some sort of a reason to keep investing in this growth thing.”

Then what happens is you centralize that growth into a best-in-class team. For many companies, that means establishing a growth team within product. And then the third phase is that the centralized teams start to democratize growth across the product team by building processes and tools. They build all the things that allow PMs to just bake growth into how they build products.

Because for me at some point, growth is just how you build products. It’s not a separate thing. And when I joined HubSpot on on the freemium side, we were really just at that first phase where I was running the marketing growth and working with product and engineering until we got to the second phase.

And then today, we have a centralized product team who sit within product, and they are really establishing the best practices. But they actually democratize a lot of that, and the PMs are actually responsible for it. When they build new features, they’re really thinking: “Should this be free? What should be in free? What should be in the paid tier? What are my PQL triggers? How do I upgrade people to the paid version of this feature?” And it’s really just baked into how they’re building product.

Amanda: A lot of the time, growth is a very cross-functional and often frustrating process within companies. What’s your advice for marketers who might find it challenging to affect that product roadmap?

“Stop speaking to just marketers”

Kieran: Stop speaking to just marketers. Go hang out with the product and engineering team. I’m an ex-developer, and even when I started to work a lot more in product and engineering in the freemium role at HubSpot, I made so many mistakes that are just basic mistakes.

One of the good examples of this is that marketers tend to jump to solutions – and for good reason, because they are always under pressure. You tell your engineer, “Go build this thing for me.” But the engineer actually doesn’t want you to just prescribe a solution or the product.

Where product and engineering are really good is in trying to articulate the problem in a very clear way so they can understand it and get their hands around it before they ever start to get to a solution. From working with PMs and engineers, I learned to be more thoughtful about the problem before I actually suggest a solution. That’s definitely one thing you can do: spend time with product, spend time with engineering, and build empathy between those teams.

There’s a really smart guy – Mike Greenberg, VP of engineering for Credit Karma. He’s an amazing person. I talked to him a lot about this, and he has some really great thoughts on how you build empathy between marketing and engineering. Because that’s definitely one of the relationships that is key in marketing going forward, especially for product-led companies.

He had this really funny story where he’s like: “Marketers will come to engineers and ask them, ‘Just turn the button red.’” That’s just an example. It wasn’t a true example, but it was funny, because that actually does happen. You go to an engineer and say, “Just turn this button red,” and go away for a day and come back.

The engineer, in the meantime, has found out that there are many hidden complexities in actually doing that in the systems. Maybe another team doesn’t want that color because it doesn’t fit the style guide. Or maybe if he turns that thing red, other things turn off (and those other things, it turns out, run the whole company).

So the marketer comes back the next day and asks, “Hey, have you turned that button red?” The engineer goes, “Well, not yet, because there’s all these things.” And the marketer is thinking, “it should only take five minutes,” right?

That’s where a marketer doesn’t understand the intricacies of all the different things that are going on in the backend. But the way you can build empathy towards that is by spending more time with those different teams.

The best way to measure growth

Amanda: You can almost always make the numbers say whatever people want to hear. But that’s not necessarily always the best thing to do. What are the best ways to measure growth and what are the metrics that you always look out for?

Kieran: When you’re under pressure you can definitely make the numbers tell the story you want to tell, no matter what. It’s probably not the best thing to do for your career long-term. I can give some examples, but I think it’s very dependent upon the company, because every company is different.

When a lot of companies are in their growth journey, the inflection point they go through is when they’ve discovered their “north star metric.” I’m sure you guys have a similar metric to that – the north star metric is the thing that tells how much value people are getting from the product. Because that’s the thing you really want obsess over. Regardless of all the metrics, the thing you’re going to care about is whether more users experiencing the true value of the product.

“Your north star metric tells how much value people are getting from the product”

For example, when we discovered that two or more people from the same company were using our platform in a meaningful way – and we had some different actions that would show us they were getting true value from it – we were able to then collaborate across teams on a single kind of metric.

When we acquired users, we looked to see how many of those users would go do that action. And when we created our onboarding, we would onboard people to do that action. And we knew that the more people who took that action, the better upgrade rate, the better the retention.

You can try to figure out the things that are happening in your product that correlate to that person getting more value. And typically what you look for is whether those people are upgrading and retaining, because that’s what shows you they’re getting true value from the product. They’re the metrics that tend to matter.

But the cool thing about growth teams is that you can change the metric they should focus on throughout the year. You can create these small groups of people around the metric you want to move at any given point in time, and they can quit some things to make movement on that metric, and then you can repurpose them into other metrics that matter for you.

“Are people upgrading and retaining? That’s what shows you they’re getting true value from the product”

Amanda: It’s been a little over 10 years now since Facebook became probably one of the first companies to introduce a role dedicated to growth. I’d love to learn more about how you run marketing and growth at HubSpot. Organizationally, how are you guys set up? Are marketing and growth two different teams or one and the same?

Kieran: We’ve learned a lot about this. We’re really in that second and third phase, where we have a centralized team who sit within product. I’m within marketing, so product really owns growth in HubSpot now, and that centralized team have done a really good job of democratizing the growth across PMs. That’s the big thing, right? When PMs create their features and are building product, they have the tools to run experiments. They have the tools to figure out where their upgrade points go, and they have the growth team to actually work with them on that.

The way we collaborate with product today is by creating small groups – these kinds of squads – of product engineers and marketers around specific things we want to do. I run all of the acquisitions: everything that gets into leads and everything that gets into the products. And when they get into the product, product have instrumented the paths of how those people onboard and upgrade. And we learned a lot from that when we started a freemium.

And then we have some other initiatives within acquisition that, where we’re actually building product to better acquire people. For those two initiatives, we have squads built out, where we have a couple of a marketers, a couple of engineers and a couple of product people who are all focused on moving that metric.

Amanda: And what, in your opinion, is the most effective way to instill a growth mindset within an organization?

Kieran: Show wins – through the chaos and the arguments – to begin with. If you can get some wins under your belt in the first three to six months, it changes everyone’s opinion of what you’re doing. And so you’re not just running all of these crazy experiments and annoying the product team.

A lot of the time when we first started, we were lucky that we had a really great product team who allowed us to try things with them. But if we did that, and for the first six months nothing happened, then we would’ve just gone back to doing it the way that things worked beforehand.

“If you can get some wins under your belt in the first three to six months, it changes everyone’s opinion of what you’re doing”

You may see some things that are long-term plays and probably have longer-term scalability and will be a bigger impact on the overall company, but they’ll take a long time to actually see the results of. Then there are these smaller things that have very small impacts, but you can actually see that impact in a short amount of time.

Those are the things I would initially focus on. And then when you’ve done that, you’re just building out the tools and processes to democratize growth across the product, engineering and the company.

Amanda: And with all that you do, how do you find the time to run your own podcast called The Growth TL;DR? Tell us about the show. What motivated you to start it, and who are some of your favorite guests so far?

Kieran: The reason I started the show is very different from why other people start podcasts. I’m an introvert and if I was left to my own devices, I would sit in my room and not talk to humans. But that’s not the best way to learn. The best way to learn is to talk to other humans, because humans know more things than I do.

And so the reason I started the podcast was because I’m based in Dublin and I do travel for conferences, but I don’t get to spend lots of time in Silicon Valley or all these places where all these people hang out – not that good people don’t hang out in Dublin, like Intercom and all these great companies.

Honestly, it was just to interact and learn from other people, and it’s gone actually pretty well. And I don’t know, all of the guests are my favorite guests in their own individual ways.

Amanda: Very diplomatic answer.

Kieran: I learned to be a politician.

Kieran’s career advice

Amanda: Now that you’re on the older side of the mic today. I wanted to ask you something that I’ve heard you ask a lot of your guests. What are some of the skills you are most thankful for possessing in your career?

Kieran: There are a couple of things. I am not the de-facto person to give you career advice because I had two careers. I started my career as a software developer and I was terrible at that – really average. Then I restarted as a marketer. And one of the things that really helped me was just to start to do things I was actually interested in.

I spent a lot of time getting my degree and then I was like, “Well, I have my degree, so I should keep developing because, you know, I have this degree.” I did that for two or three years, and I thought: “Well, things might get better. I might get more interested.” And I realized that I would never get interested because I was never very good at it. So do the things that you’re passionate about. That’s been one of the things that have helped me.

“Do the things that you’re passionate about”

There are a lot of people who think, “Oh, I want to be a director or VP.” Then in one company, they’re a manager. And in another company, they’re a VP – but they’re the VP with one other person and the janitor, right? And they’re not getting too much experience. I’ve never really asked for a title. I’ve always tried to focus on what I thought was the biggest opportunity the company had and tried to maneuver myself into that place.

And then the final thing is to always look for feedback. The thing I’ve always tried to do in my career is get feedback from everyone, no matter how brutal it is on me – a lot of it is brutal, because I do a lot of things wrong. Then I act on feedback pretty fast. And that’s helped me out pretty well.

Amanda: What’s the best piece of feedback or advice you’ve received so far?

Kieran: There have been a couple, actually. I’ll give you two of my favorite ones. I’m very numbers-focused and when I first started managing large groups of people, someone wrote, “Kieran is very robotic. He comes in and says, ‘What are the numbers? Just give me the numbers.’” And they were right.

I was not showing any empathy towards their lives – these people who are on my team. I wasn’t asking them how their weekend was. I was just like, “How do we get ahead and grow?” And that was really great for me as both a manager but also a human, right? Taking more interest in people, and building empathy with them.

Then the other one was when I started working on freemium, someone said to me: “You’re the most black-and-white person. You believe this thing, and everyone who does believe that thing are right, and they’re great, and you think they’re awesome. But everyone who doesn’t believe that thing, you think they suck and they’re not good at their jobs.”

I didn’t understand the gray. Right? And that’s why I never took time to sit down with that person, understand why they didn’t agree with that thing or why they weren’t doing anything I wanted them to do. And that, again, was a huge inflection point in my career that made me a lot better as a manager an as a person by taking on board that feedback.

Amanda: That’s great. Thanks so much for coming in today. Where can we keep up to date with your thinking?

Kieran: Yeah. You can go to HubSpot and check out all our stuff. You can find me on LinkedIn, or go to Twitter. Go to LinkedIn actually, because my name on Twitter is really stupid, it’s @SearchBrat.