Dan Hockenmaier is the Chief Strategy Officer at Faire.

On Growth Strategy & Modeling

  1. On the purpose of a growth model: "It's an analytical representation of how the business grows... 50% of the value you get from it is simply building the model right, like it forces you to understand it." [1]
    • Source: Developing a growth model + marketplace growth strategy | Dan Hockenmaier, YouTube [1]
  2. Growth models as prioritization tools: A growth model is "not a forecasting tool, but a prioritisation and bet-sizing tool." [2]
    • Source: Marketplace Growth Strategy and Growth Model by Lenny and Dan Hokenmaier, seahyingcong.com [2]
  3. The surprising sensitivity of retention: "One of the immediate things that you see when you build these [growth models] is that your growth is much more sensitive to customer retention than you can ever intuit." [1]
    • Source: Developing a growth model + marketplace growth strategy | Dan Hockenmaier, YouTube [1]
  4. The power of focusing on the early user experience: "Very often I think the biggest wins in retention come from inflecting the early user experience." [1]
    • Source: Developing a growth model + marketplace growth strategy | Dan Hockenmaier, YouTube [1]
  5. Retention is a core product issue: "Retention is rarely solved at the point of churn. It requires deeply understanding what matters to customers and what is the current customer experience... So you should be working on core product levers than growth levers." [2]
    • Source: Marketplace Growth Strategy and Growth Model by Lenny and Dan Hokenmaier, seahyingcong.com [2]
  6. The problem with optimizing for speed at all costs: "If you just get if you optimize for speed at all costs... you know you should be instead thinking about things like how do we test really disparate things to make sure that we are really testing at the ends of the experience."
    • Source: Advice on Organizing and Running Growth Teams from Dan Hockenmaier and Gustaf Alströmer, YouTube
  7. Organize experiments by hypothesis: "I'm a big fan of... organizing all the things you could ship by hypothesis it's testing so that you aren't making a bunch of runs at answering the same question but you rather start to learn what's true." [3]
    • Source: Lessons Learned Growing Successful Marketplaces w/ Mike Duboe, Lenny Rachitsky, & Dan Hockenmaier, YouTube [3]
  8. Don't jump into heavyweight acquisition too soon: A common mistake is "really heavyweight acquisition particularly if it's unsustainable prior to having the right kind of retention."
    • Source: Advice on Organizing and Running Growth Teams from Dan Hockenmaier and Gustaf Alströmer, YouTube
  9. The evolution of growth teams: "I think we will see actually fewer dedicated growth teams in the way that we have seen them historically and more people who are good at growth just becoming data-driven product and marketing leaders."
    • Source: A Primer on All Things Growth with Mike Duboe, Dan Hockenmaier, and David Weinstein, YouTube
  10. The danger of over-optimizing: "People testing without paying attention to whether they really understand their customers or whether they really have product market fit and so you can optimize yourself into the ground as many companies have done."
    • Source: A Primer on All Things Growth with Mike Duboe, Dan Hockenmaier, and David Weinstein, YouTube
  11. Payback period over LTV:CAC: Linking contribution margin to reinvestment in paid marketing "makes it really clear why thinking about something like payback period is a much better measure of paid marketing performance than LTV to CAC." [1]
    • Source: Developing a growth model + marketplace growth strategy | Dan Hockenmaier, YouTube [1]
  12. The three fundamental jobs: "There are only three fundamental jobs at any company: Building - creating the product or the company itself. Selling - getting more customers to use the product. Understanding - learning more about what to build or sell."
    • Source: Build, Sell, Understand, Dan Hock's Essays

On Marketplaces

  1. The Gardener vs. the Construction Worker: "If you think about running a marketplace you're basically like a gardener you have to have a very light touch like if you're building a SAS business you're a construction worker you're like building the product and the features and selling it and it's this very linear thing." [1]
    • Source: Developing a growth model + marketplace growth strategy | Dan Hockenmaier, YouTube [1]
  2. The primacy of demand: "Ultimately demand is the only thing that matters if you are successful at aggregating the demand in your industry you will have the winning marketplace." [1]
    • Source: Developing a growth model + marketplace growth strategy | Dan Hockenmaier, YouTube [1]
  3. Why people over-rotate on supply: "Supply is disproportionately important early on because it is the product like until you have enough supply you don't have anything... and two is often the supply side of marketplace is using the product more deeply." [1]
    • Source: Developing a growth model + marketplace growth strategy | Dan Hockenmaier, YouTube [1]
  4. The purpose of acquiring supply: "You only should acquire supply to the extent you understand how it impacts demand." [1]
    • Source: Developing a growth model + marketplace growth strategy | Dan Hockenmaier, YouTube [1]
  5. The bare case for managed marketplaces: "There's another name for a business with a 100% take rate which is not a Marketplace... effectively what you're doing over this time is like getting rid of some of the things that make marketplaces great businesses the like low Capital intensity scalability." [4]
    • Source: All Things Marketplaces with Dan Hockenmaier, Casey Winters, and Lenny Rachitsky, YouTube [4]
  6. The bull case for managed marketplaces: "The bull case is it's the best experience and still cheaper which is it's hard to pull off... if you look at the examples of companies that have won they were also cheaper." [4]
    • Source: All Things Marketplaces with Dan Hockenmaier, Casey Winters, and Lenny Rachitsky, YouTube [4]
  7. Marketplaces are hard to start, but valuable: They are "hard to start but immensely valuable after the flywheel is built." [2]
    • Source: Marketplace Growth Strategy and Growth Model by Lenny and Dan Hokenmaier, seahyingcong.com [2]
  8. The complexity of marketplace questions: In a marketplace, "everything is just harder every question is more complex." [1]
    • Source: Developing a growth model + marketplace growth strategy | Dan Hockenmaier, YouTube [1]
  9. Don't get stuck on theory early on: "In the beginning, don't get stuck on marketplace theory, 90% of what an early-stage marketplace needs is the same as any other business, like growth, profit and retention." [2]
    • Source: Marketplace Growth Strategy and Growth Model by Lenny and Dan Hokenmaier, seahyingcong.com [2]
  10. The inverse CAC curve of marketplaces: "Usually, CACs for businesses go up as they reach the next marginal customer, but for marketplaces, it's the inverse due to improving liquidity." [2]
    • Source: Marketplace Growth Strategy and Growth Model by Lenny and Dan Hokenmaier, seahyingcong.com [2]
  11. The importance of 'share of wallet': "One metric that is has seemed to me to be very important in Marketplace that may be less so elsewhere is share of wallet like how much of your supplier business are you getting." [4]
    • Source: All Things Marketplaces with Dan Hockenmaier, Casey Winters, and Lenny Rachitsky, YouTube [4]
  12. On unbundling large platforms: The unbundling thesis is usually based on creating a better vertical experience, but this "usually gets swamped by three massive advantages of being a broader business."
    • Source: Thread by @danhockenmaier, Rattibha
  13. Adding SaaS to a marketplace: "It's easier for a marketplace to add a SaaS business rather than the other way around, but it's challenging... Don't add a SaaS product until your marketplace is performing well and you've found a real customer pain point to solve." [5]
    • Source: [Summary] Developing a growth model + marketplace growth strategy, PodcastWorld.io [5]

On Product & Analytics

  1. The value is in the building process: "50% of the value you get from [a growth model] is simply building the model right, like it forces you to understand it." [1]
    • Source: Developing a growth model + marketplace growth strategy | Dan Hockenmaier, YouTube [1]
  2. Look for variability in the user experience: "One really valuable lens is to look for variability in that experience. So for the first week or month which customers are having a bad experience but shouldn't be." [1]
    • Source: Developing a growth model + marketplace growth strategy | Dan Hockenmaier, YouTube [1]
  3. The trap of general-purpose products: "The internet killed general-purpose products. AI will bring them back." [6]
    • Source: Dan Hock's Essays, Substack [6]
  4. Growth and marketing are now product functions: "So much of growth and marketing is basically a product now, led with data and engineers building infrastructure to automate it and not wing it." [7]
    • Source: Lessons Learned Growing Successful Marketplaces, Greylock Partners [7]
  5. Focus on what is movable: "The more you work on this stuff the more you will learn what actually is movable." [1]
    • Source: Developing a growth model + marketplace growth strategy | Dan Hockenmaier, YouTube [1]
  6. Early proxies for retention: "The next set of metrics you need after a retention is one of the early proxies for retention so you can experiment on that."
    • Source: Advice on Organizing and Running Growth Teams from Dan Hockenmaier and Gustaf Alströmer, YouTube
  7. The challenge of predicting experiment results: "It is quite hard to have good hypotheses about what's going to work like I am constantly wrong trying to predict the results of experiments."
    • Source: Advice on Organizing and Running Growth Teams from Dan Hockenmaier and Gustaf Alströmer, YouTube
  8. The hierarchy of growth concepts: "So much of what is written about growth is noise. Here are ten of the concepts I find myself coming back to over and over again 1/ The Hierarchy."
    • Source: Dan Hockenmaier Twitter Threads, twtext.com
  9. From funnel to loop: "You should think of user acquisition in terms of a loop rather than a funnel." [4]
    • Source: A Primer on All Things Growth with Mike Duboe, Dan Hockenmaier, and David Weinstein, YouTube [4]
  10. The difficulty of building a growth model: "It's not meant to be precise, but directionally accurate." [2]
    • Source: Marketplace Growth Strategy and Growth Model by Lenny and Dan Hokenmaier, seahyingcong.com [2]

On Career & Mindset

  1. The CEO's clarifying question: "Do you want to build, or do you want to sell?" [8]
    • Source: Build, Sell, Understand, Dan Hock's Essays [8]
  2. Find joy in your fundamental role: "Ask yourself where you derive joy (and what you can put up with)." [8]
    • Source: Build, Sell, Understand, Dan Hock's Essays [8]
  3. The inevitability of selling: "The job of selling comes for most of us eventually. Recruiting, managing, and working cross-functionally are all mostly about selling." [8]
    • Source: Build, Sell, Understand, Dan Hock's Essays [8]
  4. Mid-career frustration for builders: "One of the most common sources of mid-career frustration is when builders or understanders realize that they are being asked to get into sales." [8]
    • Source: Build, Sell, Understand, Dan Hock's Essays [8]
  5. Strategy as the 'understand' function: "Today I find myself in a job which is neither of those two: I lead the Strategy & Analytics teams at Faire, whose primary job is to understand." [8]
    • Source: Build, Sell, Understand, Dan Hock's Essays [8]
  6. The power of writing to clarify understanding: "Every time I try to write about something that I think I understand, I am forced to confront this idea from Paul Graham again." [9]
    • Source: Dan Hockenmaier, Substack [9]
  7. Separating signal from noise: A core theme of his work is "Always trying to separate signal from noise." [9]
    • Source: Dan Hockenmaier, Substack [9]
  8. On starting his consulting firm, Basis One: "I founded basis one completely on accident... we looked back and realized we were building a consulting firm on accident and it was working really well." [3]
    • Source: Lessons Learned Growing Successful Marketplaces w/ Mike Duboe, Lenny Rachitsky, & Dan Hockenmaier, YouTube [3]
  9. Think long-term with metrics: "Think about the metrics you're optimizing for making sure they're long term making sure they're sustainable."
    • Source: Advice on Organizing and Running Growth Teams from Dan Hockenmaier and Gustaf Alströmer, YouTube
  10. On the value of his early consulting career: "I don't think I learned much about how to actually run a business at those places but I did learn a lot about how to think about them." [1]
    • Source: Developing a growth model + marketplace growth strategy | Dan Hockenmaier, YouTube [1]
  11. The real education begins at startups: "I think my real education on this began at Thumbtack." [1]
    • Source: Developing a growth model + marketplace growth strategy | Dan Hockenmaier, YouTube [1]
  12. Growth as a hybrid role: "The role I landed on after that conversation was in growth, which is a mix of building and selling." [8]
    • Source: Build, Sell, Understand, Dan Hock's Essays [8]
  13. On the future of work and AI: "AI will break fundamental trade-offs in product design and bring back massive general-purpose products in retail, media, education, and more." [6]
    • Source: Dan Hock's Essays, Substack [6]
  14. The role of a strategist: "The strategy team at Faire does a bunch of work to help our other teams make better decisions." [1]
    • Source: Developing a growth model + marketplace growth strategy | Dan Hockenmaier, YouTube [1]
  15. On the fun of working on marketplaces: "I love the customers we're serving. So it's a marketplace connecting local retailers and independent brands and I just think it's a really fun group of customers to build for." [1]
    • Source: Developing a growth model + marketplace growth strategy | Dan Hockenmaier, YouTube [1]

Learn more:

  1. Developing a growth model + marketplace growth strategy | Dan Hockenmaier - YouTube
  2. Marketplace Growth Strategy and Growth Model by Lenny and Dan Hokenmaier
  3. Lessons Learned Growing Successful Marketplaces w/ Mike Duboe, Lenny Rachitsky, & Dan Hockenmaier - YouTube
  4. All Things Marketplaces with Dan Hockenmaier, Casey Winters, and Lenny Rachitsky
  5. [Summary] Developing a growth model + marketplace growth strategy | Dan Hockenmaier (Faire, Thumbtack, Reforge) | Lenny's Podcast: Product - PodcastWorld.io
  6. Dan Hock's Essays | Dan Hockenmaier | Substack
  7. Lessons Learned Growing Successful Marketplaces - Greylock Partners
  8. Improve revenue conversion, expansion, and retention with potential and healthy customers
  9. Dan Hockenmaier - Substack