The Community Playbook for Founders (from Flybridge)
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The document outlines a playbook for founders on building and scaling engaged communities, emphasizing the importance of shared purpose, clear objectives, and effective engagement strategies. It discusses community's role in product development and business models, highlighting how strong communities can enhance customer acquisition and retention. Additionally, the playbook presents methods for measuring the financial impact of community initiatives.
The Community Playbook for Founders (from Flybridge)
- 1. J A N U A R Y 2 0 2 1 The Community Playbook for Founders Jeff Bussgang General Partner & Co-Founder Senior Lecturer, HBS
- 2. Confidential Presentation Community = Outsized value Notes: AirBnB value as of mid-2020, VRBO as of 2015 HomeAway acquisition. Peloton value as of Sept 2020, LifeFitness as of 2019 acquisition. $110B Value $3.9B Value VS $45B Value $0.5B Value VS 2
- 3. Confidential Presentation 3 Confidential Presentation Now is the moment for community Confidential Presentation Humans crave community now more than ever. 1 Traditional ways of attracting, retaining, and growing customers are too expensive and crowded. 3 New platforms make creating, managing & scaling communities easier than ever. 2 3
- 4. Confidential Presentation 4 We created a guide for founders to building an engaged and passionate Community ecosystem Formation & Engagement 1 Business Model 3 Product Feedback, Experience & Support 2 Measuring ROI 4
- 5. Confidential Presentation 5 Focus on the “Who” 1 Set Clear Objectives 2 Create engagement activities 3 Three critical principles of community building: Formation & Engagement 1
- 6. Confidential Presentation 6 P E R S O N A S Start Narrow to form from a “Cold Start” Communities need unifying theme to come together All exec women in the world C-Levels, US C-Levels, NYC C-Level exec women, NYC in retail media or tech Define who you are building the community for FORMATION & ENGAGEMENT: FOCUS ON THE “WHO” 1 Confidential Presentation
- 7. Confidential Presentation 7 Product support and success Source of new customers Product innovation and feedback Community as the product itself Why do you want to form a community? Focus and prioritize your key objectives: FORMATION & ENGAGEMENT: SET CLEAR OBJECTIVES 1
- 8. Confidential Presentation 8 Lay the groundwork for community success with 7 key elements: FORMATION & ENGAGEMENT: SUCCESS ELEMENTS 1 A shared purpose and values 1 Simple, easily accessible value consumption 2 Simple, easily navigable value creation 3 Clearly defined incentives and rewards 4 Carefully crafted accountability 5 Healthy diverse participation driven by good leadership 6 Open, objective governance and evolution 7
- 9. Confidential Presentation 9 Craft an engagement strategy across a set of fluid, well-defined stages Example: educational nonprofit Facing History FORMATION & ENGAGEMENT: PORTFOLIO OF ENGAGEMENT 1 L E V E L O F C O M M U N I T Y E N G A G E M E N T
- 10. Confidential Presentation 10 As a product development resource 1 Community as the product 2 To support itself Considerations for communities and product development What part of the organization? PRODUCT FEEDBACK, EXPERIENCE & SUPPORT 2 3 4
- 11. Confidential Presentation 11 Communities are powerful sources of information to inform customer discovery and product development Assign community leads for product teams Lean into critical feedback Prioritize product roadmap based on community needs PRODUCT FEEDBACK, EXPERIENCE & SUPPORT: COMMUNITY AS PRODUCT DEVELOPMENT RESOURCE 2
- 12. Confidential Presentation 12 Creating a community as the product • 5,000 names on wait-list • Get: advice to advance your career • Give: peer-to-peer coaching • Community as a formidable competitive moat for scaling Private network supporting exceptional professional women Launched 2019 C A S E S T U D Y PRODUCT FEEDBACK, EXPERIENCE & SUPPORT: COMMUNITY AS THE PRODUCT 2
- 13. Confidential Presentation 13 Where does the community function sit in the organization? COMMUNITY MANAGERS SKILLS: > Marketing > Product > Under CEO Customer Support Branding/PR Social Media Content EQ PRODUCT FEEDBACK, EXPERIENCE & SUPPORT: ORGANIZATIONAL DESIGN 2
- 14. Confidential Presentation 14 Business Model Components 1 3 Network Effects 2 Community Effects BUSINESS MODEL 3 A strong community has an extraordinary impact on the company’s business model.
- 15. Confidential Presentation 15 Startup Business Model: BUSINESS MODEL: COMPONENTS 3 How the organization makes money Profit Formula Set of operational methods to fulfill the value prop Technology Operations Model Differentiated solution for an unmet customer need Customer Value Prop How potential customers are made aware of the offering Go To Market
- 16. Confidential Presentation 16 The value of the product increases with every new user Network effect drives success: • Codecademy Pro users meet & share best practices in Slack • Access to events with industry professionals and peers. • Advanced learners mentor the novices 50 million learners to date Founded 2011 C A S E S T U D Y BUSINESS MODEL: NETWORK EFFECTS 3
- 17. Confidential Presentation 17 BUSINESS MODEL: NETWORK EFFECTS 3 Communities as superchargers of network effects The Power of Communities Drive Customer Acquisition Support Other Community Members Increased Customer Retention Improved Value Proposition “Community members show up for the Meetup but come back for the people” Scott Heiferman, founder of Meetup
- 18. Confidential Presentation 18 CROI You can’t manage what you can’t measure. MEASURING COMMUNITY ROI: CROI & TRACKING 4 = (Value Gained – Cost) Cost Areas to track when building a community initiative Community Consumption & Value Creation Delivery and Execution Organizational Experience
- 19. Confidential Presentation 19 Show financial impact of community through: MEASURING COMMUNITY ROI: COMMUNITYS FINANCIAL IMPACT 4 Increased deal size Lowered support ticket costs Higher product adoption Added features into product Increased sales pipeline
- 20. Confidential Presentation 20 Measuring financial impact from Community C A S E S T U D Y MEASURING COMMUNITY ROI: CROI & TRACKING 4 Sophisticated community-based software company Community team staff 10+ Attendees at Atlassian Community events: • 81% free trial • 34% purchased INCREMENTAL VALUE PER ATTENDEE: $1,632 Financial Metrics • $6K Avg rev per customer • 80% Gross Margin • $100 CAC (VALUE GAINED – COST) / COST = CROI ($1632-$100) / $100 = 15.3x
- 21. Confidential Presentation 21 Bringing it all together Formation & Engagement 1 • Start with Who • Define business objectives • Define success Product Feedback, Experience & Support 2 Leverage community as product development resource Business Model 3 Build strong “community effects” to help scale Measuring ROI 4 Measure community ROI to justify more spend
- 22. Confidential Presentation 22 Confidential Presentation Now is your moment for community. Confidential Presentation 22
- 23. J A N U A R Y 2 0 2 1 The Community Playbook for Founders Jeff Bussgang General Partner & Co-Founder Senior Lecturer, HBS