GM section: NSM

Growth Modelling is a systematic approach to understanding, measuring, and driving growth in a business. It helps identify the key problems that need solving and the core levers that your organisation needs to double down on.

Let's start by identifying the north star metric:

1. Identify the north star metric for your product

2. Build a mathematical growth equation to achieve the north star

3. Collate the current metrics and establish a nuke scenario

4. Calculate the incremental growth based on your growth model

5. Learn how to present your growth model in a structured manner

Identifying the north star metric

North star metric depends on your product and the stage of your product. In the modules, we've learnt about the different north star metrics at different stages. If you're not clear, it's suggested that you go back and watch the modules again.

Here are the north star metrics for a couple of companies:

Company	PMF stage	Early scaling	Mature scaling
Spotify	% activation rate % new user retention	% Retention # engaged sessions #average time spent	#paying subscribers % paid subscriber retention # active advertisers # session frequency $ Average CPM #CAC to LTV ratio
Amazon	% activation rate % new user retention	% Retention # paying customers # frequency of purchase	% revenue retention # paying customers # frequency of purchase $ Average order value #CAC to LTV ratio
Spotify	% activation rate % new user retention	# engaged sessions # average time spent	% revenue retention # active advertisers # session frequency

Company

PMF stage

Early scaling

Mature scaling

Spotify

% activation rate

% new user retention

% Retention

# engaged sessions

#average time spent

#paying subscribers

% paid subscriber retention