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Cohort analysis provides deep insight into customer bases because cohorts expose how customer accounts grow, evolve and churn. Plus, cohort analysis provides a framework to evaluate product releases, marketing pushes and advertising campaign performance.

The Six Cohort Reports I Use to Understand Trends

Below is a list of the six reports I create when analyzing cohorts. The combination of these six reports provides a robust summary of the state of a customer base. By no means exhaustive, this collection is a solid starting point and of course these are framed in the context of revenue but could easily be changed to activity or another metric.

Control4’s IPO last week and Nest’s massive success mark the beginning of mainstream, useful connected devices. In the decade to come, the most successful will be united by one common characteristic. They will anticipate our needs and make us lazier.

Living is hard work. So many things to remember, like buying milk on the way home tonight. Plenty of software has been written to help us manage our daily torrent of to dos. In fact, there is a fine app for Remembering the Milk.

I never thought learning how to write better might help me understand product design but it has. Great literature and well designed products share one defining attribute: they create a telepathic connection between the creator and the consumer.

Before you chuckle and write me off as a palm reading gypsy, hear me out. The idea isn’t mine, but Stephen King’s. Over the weekend, I read King’s blunt and inspirational autobiographical narrative, “On Writing.” In this book, Stephen King accomplishes two things. First, he tells the story of his struggles to become a successful author. Second, he explains all the tools he used to accomplish his goal.

As I wrote about in a post on aligning founder and VC incentives, it’s important for entrepreneurs to understand their own ambitions and the ambitions of investors. The most important part of that is understanding the financial motivations and the dynamics of the industry VCs face.

Typically, VCs adopt primarily one of three strategies with a fund [1]:

1. Small fund, small ownership positions, many investments in markets that will consistently generate sub-$100M acquisitions.
2. Medium fund, sizable ownership positions, a moderate number of investments in markets that will occasionally generate $150M to $800M acquisitions.
3. Large fund, moderate ownership positions, a moderate number of investments that will consistently generate $1B+ acquisitions.

I’m going to use CBInsights' 2012 Private Technology Company M&A Data data to demonstrate why VCs adopt these three strategies.

How should a successful marketing initiative for a startup operate? It’s possible to jump right into performance marketing immediately after launch, optimizing conversion funnels and squeezing every cent out of ad spend. But I think there’s an important step that precedes performance marketing: community development. 

Yesterday, I met with an entrepreneur who was researching how best to build a marketing team for her business. After having spoken to many other founders, she decided to prioritize community management before traditional marketing. She wanted to build a community of people who she could educate about her product, who would use it and become vocal champions.

Crowdfunding platforms solve three key problems for startups, two of which are obvious. Kickstarter and Indiegogo, among others validate demand and provide short term financing by marketing product ideas and accepting pre-payment for future delivery. Consumers vote with their dollars to catalyze product development.

The third, less obvious benefit, is the platforms cajole startups to follow a product management process similar to Amazon’s process, described below by Ian McAllister in his Quora post What Is Amazon’s Product Management Process?

From time to time, entrepreneurs ask one investor for referrals to other investors. After all, investors network frequently, work together and have long term relationships with each other so a referral should go a long way. But not all introductions are equal.

The most successful investor-to-investor referrals are those where the referring investor is investing in the business and is seeking to fill out the round with complementary capital. By investing, the referring investor sends a strong signal to others about his/her excitement about the company. This happens most often in seed rounds but also occurs in Series A, B and later.

In 2005, I started as a customer support rep in the AdSense team at Google. Over the next few months, I was trained in the art of handling hundreds of emails per day.

My training focused on using a customer service tool called Trakken that Google had acquired and heavily modified to enable AdWords and AdSense teams to manage the torrent of inbound support emails from customers. In AdSense, a team of fewer than 100 people supported a few hundred thousand customers almost exclusively through email with customer satisfaction scores consistently above 90%.

Sales pitches ought to frame a product in a way to maximize the chances of success of a sale. One trend I’ve been seeing in pitches is to talk about how software can save costs by reducing a customer’s head count. A pitch that focuses on cost savings by reducing staff should be delivered only after much consideration because of a few objections created in these pitches that might slow or halt the sales process.

Sales pitches ought to frame a product in a way to maximize the chances of success of a sale. One trend I’ve been seeing in pitches is to talk about how software can save costs by reducing a customer’s head count. A pitch that focuses on cost savings by reducing staff should be delivered only after much consideration because of a few objections created in these pitches that might slow or halt the sales process.