Ryan Nielsen 👨‍💻’s Post

The secret to Dropbox's explosive early growth? Cleverly designed incentives. If you want your prospects / users / employees to do something, you need to give them an enticing reason to do so. 𝐌𝐚𝐧𝐲 𝐛𝐮𝐬𝐢𝐧𝐞𝐬𝐬𝐞𝐬 𝐚𝐬𝐤 𝐲𝐨𝐮 𝐭𝐨 𝐝𝐨 𝐬𝐨𝐦𝐞𝐭𝐡𝐢𝐧𝐠 𝐰𝐢𝐭𝐡𝐨𝐮𝐭 𝐨𝐟𝐟𝐞𝐫𝐢𝐧𝐠 𝐦𝐮𝐜𝐡 𝐢𝐧 𝐫𝐞𝐭𝐮𝐫𝐧; for example, my inbox is flooded with emails asking me to review my latest purchase / Airbnb stay / customer service interaction, but it's unclear what's in it for me. Dropbox understood early that you need to dangle a carrot in front of people. They didn't just offer an incentive to both the person doing the referral as well as the newly referred user, but also came up with creative programs like the university-focused Space Race where you get more free space depending on how many referrals your entire school generates. This way, people had a reason to aggressively promote the referral program and get their friends to join (I was badgered by multiple classmates until I gave in). 𝐈𝐧𝐜𝐞𝐧𝐭𝐢𝐯𝐞𝐬 𝐜𝐚𝐧 𝐦𝐚𝐤𝐞 𝐨𝐫 𝐛𝐫𝐞𝐚𝐤 𝐠𝐫𝐨𝐰𝐭𝐡 𝐨𝐫 𝐞𝐦𝐩𝐥𝐨𝐲𝐞𝐞 𝐩𝐫𝐨𝐝𝐮𝐜𝐭𝐢𝐯𝐢𝐭𝐲, but don't get a lot of intention. How many companies have you seen that have a Chief Incentive Officer? _____ 👉 For a deep dive on the power of incentives and how to leverage them in your business, check out my latest post on OperatorsHandbook[dot]com.

#GrowthHackDay1 🔴 Referral Program 🫥 Steps to do it 1. Set up a referral system. 2. Offer rewards for referrers and referees. 3. Track referrals. 🫥 Real World examlpe: Dropbox’s "Refer a friend and get more storage" program. 🫥 Impact Grew Dropbox’s user base by 60% overnight, eventually leading to 3900% growth.

You just need to formalize it 1. It is believed that Dropbox owes its success to its widely popular referral program - when Dropbox users earned additional gigabytes for data storage if new clients connected to Dropbox using their personal links. Any good mechanics want to be copied. 2. However, here I heard a great phrase - "before launching the referral program, Dropbox already had a significant number of connections based on recommendations from friends." So Dropbox simply took what they already had - and added an incentive in the form of additional gigabytes to make it work even better. 3. You can't force people to do something, you can't come up with a good mechanic and convince people to follow it. You can only look at what people are already doing - and formalize it in the form of a mechanic so that they want to do it more and more often 😉 4. This applies not only to marketing, but also to finding new ideas. Don't come up with ideas out of thin air. Spy on what at least someone does at least sometimes, and figure out how to help or what to remove so that many more people do it much more often.

I interrupt your regularly scheduled LinkedIn doom scrolling to share that I've taken on a full-time role with Dropbox! And I couldn't be more thrilled—I absolutely love the team & find the business problem fascinating. And I want to be part of the dream team to solve it. Does this mean I'm done with solopreneurship? Ha, it's not quite that black and white. I've been a happy solopreneur for 5 amazing years. It's been incredibly refreshing and liberating—I wouldn't have had it any other way. But I've come across something I want to sink my teeth into, so I've committed. And once an solopreneur, always an solopreneur - so the future may (and will) hold more of this. But I'm proud to be flexible with my career and continue building a non-linear path. In the meantime, I'll still be advising on the side while keeping my newsletter and Reforge courses running. Those are now part of my baseline that I'll never let go of. And why Dropbox? 💙 🖤 1. I love Drew's vision & mission for the product and I want to help the company get there [hint: we’re *Dash*-ing towards new products]. 2. The scale of Dropbox is jaw-dropping (millions of paid subscribers and still signing up over a million new users a week!), and yes, the business has its challenges... but what business doesn’t? Honestly, as a growth professional, I prefer to tackle the tougher growth challenges—that's where the real learning happens. Hyper-growth unicorns are awesome, but you can do no wrong there (for the most part :)) - in the end you learn very little. 3. I've had massive 'Reverse trial' with Dropbox over the last 9 months (hello my interim engagement), so this decision is completely de-risked and I know exactly what I'm getting myself into. My north star metric has always been new data points I can learn from, and this opportunity checks all the boxes. I'll spill more beans about my choice on my blog next week! #career #newjob

Steve Jobs offered to acquire Dropbox for 9-figures in 2009. Dropbox rejected the offer, and went on to grow from 100,000 users to 4 million in just 4 months. The referral program accounted for 35%(!!) of their daily signups. By April 2010, Dropbox users were sending 2.8 million invites to other people per month. Roughly 1 invite per second. Every second. They passed 50 million users in October 2011, 100 million in November 2012, 500 million in 2016, and 700 million in 2021. In 2017 they became the fastest SaaS company ever to reach $1 billion ARR. 𝗔𝗿𝗴𝘂𝗮𝗯𝗹𝘆 𝘁𝗵𝗲 𝗺𝗼𝘀𝘁 𝘀𝘂𝗰𝗰𝗲𝘀𝘀𝗳𝘂𝗹 𝗿𝗲𝗳𝗲𝗿𝗿𝗮𝗹 𝘀𝘁𝗿𝗮𝘁𝗲𝗴𝘆 𝗶𝗻 𝗵𝗶𝘀𝘁𝗼𝗿𝘆. -- 👉 In tomorrow's newsletter, I'll reveal the exact user journeys, incentives, and experiences Dropbox used to create their viral growth engine. Come join 43,108 subscribers who'll read it (and get a little smarter in ~3 minutes). Subscribe for free here: https://lnkd.in/g2FWfXGR

Scaling from 0 to $100 Million with just a referral program. A growth of 1300% in just 15 months. When Dropbox started in 2008, it had a cool idea. Instead of just selling more storage, it told its users, "Help us spread the word, and we'll give you more space for free! This was a game-changer. Back then, the internet was slower, and online storage was mostly for big companies. Dropbox made it simple and exciting for anyone to save and share files online. By just inviting friends, users could get more space. This smart move made Dropbox super popular, fast. By 2011, they had made $100 million, all thanks to users telling their friends about it. Key Takeaway: Encourage your users to be your growth engine, and you can turn referrals into revenue.

Go to where your market is. Before Dropbox became the "next big thing"... they were having a tough time attracting initial customers. Their product was great... But nobody was aware of it. The solution? They met their market where they were already "hanging out." Instead of testing multiple distribution channels... They focused fully on ONE forum where young, tech-savvy developers (their target market) were hanging out. This skyrocketed their waitlist from 5,000 to 75,000 people. Overnight! With this as a foundation, they were able to conquer other channels one by one. The lesson is this: Instead of relying on spray-and-pray strategies (like most companies) ... focus on only a few channels where your target customers are already conglomerating. Meet your market where they're at. P.S. Liked this post? I share tips like this in my newsletter (almost) every day. Check it out here: www.tim-schreiber.com

I ❤️ Dropbox and find it extremely useful and reliable; on the other hand, I never paid for it, having used its free service since pretty much its inception. However, the only reason I still use it, it’s because I have a Linux box as my Dev workstation, and iCloud (which I do pay for) is not supported there. I would happily pay for it, but their pricing tiers are all wrong: even the most basic charges $20/month for 2TB of data (which most people don’t really need: a handful of GB is more than enough; for example, I have accumulated around 11GB of free space through various promotions, and even then, I only use a couple of GB of that at most) which seems A LOT when compared with $3/month for 200GB in iCloud (which is more than enough for probably 90% of consumers, and provides much more utility to Apple users). They never seemed able to truly break into the Enterprise space, and even less so in the SMB market; IMHO they got their positioning wrong and their (seeming) desperation in getting users to adopt their "sharing" features (something I never truly understood, but they sure look determined in having folks adopt them, based on the insistence and intrusiveness of the popups they keep shoving at their users) seems oddly unnecessary to most consumers. I'm pretty sure they have smart folks in Marketing and experts in pricing tiers and whatnot, but IMHO if they truly want to quickly grow their user base, they should offer something competing directly with iCloud: something like a 250GB at $2/month, with a 10-device sharing limit, or something like that. Anyways, truly sorry about the folks losing their jobs: it's a tough world out there, and things ain't getting better anytime soon 😢

Dropbox has announced plans to lay off 528 employees, or 20% of its workforce, citing a challenging market and an "overly complex" organizational structure with too many layers of management. Seems like the first cuts should start at the top, where the real decisions were made! With over 2,000 employees, it’s surprising that no new features have been added to their core product in the last 15 years. Did they think syncing one folder to the cloud would be enough forever? And given all the data they have access to, it’s baffling they haven’t used it to enhance the product. Imagine the AI-driven features that could have been developed! What a missed opportunity. If you’re a Dropbox employee affected by these cuts, please comment below. I’ll create a separate post to share your profiles for greater visibility.