Demand Curve - The Growth Newsletter #174

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The Growth Newsletter #174

How to actually write a strategy document

We all obsess over the business “idea.” 9 times out 10 what we mean is the product:

• An electric car
• A language learning app
• A greens powder

The idea is the foundation. It's not particularly valuable in itself.

Lots of companies tried to make a language learning app. But they all sucked until Duolingo used this strategy:

"Use gamification to make language learning feel like a game rather than a chore."

(It also helped that they made it free during the growth phase and monetized it by crowdsourcing document translation using students as labor.)

Clearly, the strategy is more important than the idea.

In this issue, we'll talk about how to actually write a strategy document that works.

– Neal

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How to actually write a strategy document

Insight from Alex M H Smith.

As Alex starts his post: “What should a strategy actually LOOK LIKE? What is the "thing"? What is the format?”

It's not a 50-page business plan or an Excel file with 10 years of projected cashflows. 

Instead, here’s how to write a simple & effective strategy: as a Google or Word doc.

It’s divided into 4 sections:

1. The strategy argument: Outline your interpretation of the market, your plan, and why you think your plan will work.
2. The strategy statement: A short practical statement of the strategy. Boil it down so your friend can understand it when you tell them over drinks.
3. The implications: A list of the key things you must do to execute the strategy.
4. The execution flow: A suggested order and prioritization of these actions.

Strategy argument

Structure your argument in a narrative flow:

• The status quo: This is what the market is like right now
• Why this sucks: Why the status quo needs to change
• Our belief: How we think differently to everyone else (our breakthrough insight)
• Our solution: Based on our breakthrough insight, this is how we will fix the status quo and deliver massive value

The narrative flow helps you refine the weak parts of your thinking.

The strategy statement

Our brains are lazy. Even exceptionally intelligent people like simplicity.

The best strategies can be summarized in a simple sentence.

Everyone on the team should be able to hear this statement, understand it, remember it, and help it shape their thinking.

As Alex recommends:

• Don’t make it pretty (or cute)
• Don’t make it too short (or you’ll confuse people)
• Don’t make it sound like a tagline (this isn’t marketing copy)

Just make it clear. Unambiguous. Practical. Usable.

For example, when Tesla started, EVs were small and boring. Tesla could have said:

"Use EV technology to create luxury, high-performance vehicles to attract people to the segment and grow the size of the market (before going down market).”

(The bolded text is my addition to Alex’s example.)

In other words: “Make electric cars cool and desirable, then make them accessible.”

The implications

Outline the changes that need to take place to bring the business to a position where it is obviously delivering the strategy.

Obviously means that an external observer could explain your strategy to you simply by looking at what you’re up to.

For example, we never explicitly told the world that our strategy was to create a media/education business to provide free value to early-stage founders so that they trust us and want to work with our agency. But that became obvious to many people.

Break this down into sections across different parts of the business. Product, Brand, Marketing, Sales.

What does it mean for each of them? How do they each need to change?

Execution flow

If you nailed the strategy, it should be easy. If it’s not, your strategy isn’t clear enough.

Sketch out the order of the high-level actions to implement this strategy:

1. First, we need to do this
2. Then this
3. Then this

This isn’t every single task. That’s what Asana, Basecamp, and ClickUp are for. Instead, these are the high-level things your company must do to fulfill its strategy.

For example, to create a media/education business to provide free value to early-stage startups so they trust us and want to work with our agency, that could have been:

1. Start a free growth community
2. Start a free newsletter to nurture the community
3. Create free resources and distribute them on our website and social media and include mentions of the agency
4. Grow the audience and traffic to these resources

What’s next

Run the strategy by the team and friends. Then, start implementing it.

And stick to it. Don’t get distracted or compromise until the strategy is proven wrong.

If you want to dive deeper into some of Alex’s strategic ideas, I’ve written about 3 of them in previous newsletters:

• Play the Opposite’s Game with your strategy
• “Normalize the Weird” or “Weird the Normal”
• Contrarian Value

I also recommend his book No Bullsh*t Strategy. 

Or you can read through the 48 strategy tactics we've had in the newsletter.

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Something gutted

The danger of design by committee.

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Thanks, everyone! See you on Thursday.

Neal O'Grady

Justin Setzer