Lenny's Podcast: Product | Career | Growth
Breaking the rules of growth: Why Shopify bans KPIs, optimizes for churn, prioritizes intuition, and builds toward a 100-year vision | Archie Abrams (VP Product, Head of Growth at Shopify)
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When you have teams naturally break up the world into different funnel stages or different points in the jury, it gets very seductive to just look at my part of the funnel and what's my conversion rate through that part of the phone, right? And then the team starts to optimize for that conversion rate as their North Star, but in practice, it's actually almost always easier to just make it harder to do the thing right before your step in the funnel to increase your conversion rate. Instead of, I'm trying to convert a bunch of people, I just want more people to get activated. And then once you start thinking that way, you realize actually the best way to get more people to get to a step is just get more people in the door in the first place. That will always hurt your conversion rate, but it may actually give you more people on the outside. Today, my guest is Archie Abrams. Archie is VP of product and head of growth at Shopify, where he leads an org of over 600 people across product, design, engineering, and business. and design, engineering, data, ops, and growth marketing. Shopify is both an incredibly unique and also an incredibly successful business, and they do things very differently. And as a result, there's a lot that we can learn from how they approach building product and driving growth. Some examples include their priorities and product roadmap are driven by a hundred-year vision that comes from Toby, the CEO, and the core product teams don't have metrics or KPIs, they're essentially banned, and instead decisions are made based on taste and intuition, and building towards this long-term vision. Also, the growth team optimizes for churn, which is unlike any other company I've ever come across. And once you hear why, this will make a lot of sense. Also, they keep long-term holdouts for every experiment they run, and they automatically look at the impact these experiments have had on the business a year later, two years later, and three years later, and then revisit these decisions down the road. And in our conversation, we dig into all of this, plus how Shopify organizes the growth team, how they run experiments, how the growth team collaborates with the product team, how they measure impact, plus Archie shares a bunch of very specific and interesting examples of changes that have driven growth for the business, and so much more, this is such a fascinating conversation. And I know this will give you a lot to think about in terms of how you run and organize your own product and growth teams. If you enjoy this podcast, don't forget to subscribe and follow it in your favorite podcasting app or YouTube. It's the best way to avoid missing future episodes, and it helps the podcast tremendously. With that, I bring you Archie Abrams. Archie, thank you so much for being here, and welcome to the podcast. Thanks Lenny, excited to be here. Okay, so what I want to do with our time together is to basically do kind of a living archaeology of how Shopify grows and what you specifically have learned about growing a company like Shopify into this just juggernaut of a business that it's turned into. To give people a little bit of a sense of just like how large Shopify has gotten to maybe surprise them about the scale of this company at this point, could you share some stats that about the scale of the business at this point? Yeah, absolutely. So overall, what about 10% of e-commerce in the United States? So basically, if you're not buying an Amazon or Walmart, you're probably buying on a Shopify powered store. And behind the scenes globally, we did about $235 billion in GMV in 2023, which is roughly the size of the economy of Finland. So we've got a big economy and big impact happening from Shopify. Wow, I think interestingly with Shopify, it's kind of this behind the scenes tool. And so I imagine many people have no idea they're using Shopify a lot of time when they're buying stuff online. And I think some of these numbers kind of creep up on people just how large a company like Shopify has gotten. 100%. This episode is brought to you by Expo, a game changer for customer facing analytics and data reporting. Are your users craving more dashboards, reports, and analytics within your product? Are you tired of trying to build it yourself? As a product leader, you probably have these requests in your roadmap, but the struggle to prioritize them is real. Building analytics from scratch can be time consuming, expensive, and a really challenging process. Enter Expo. Expo is a fully white labeled embedded analytic solution designed entirely with your user in mind. Getting started is easy. 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