Arrow icon
Ness Labs: Make the most of your mind
Learn more about Joggo

A Summary of

Demand driving supply: The little-understood growth loop behind a surprising number of iconic billion-dollar compa…

Lenny Rachitsky
Lenny's Newsletter
View original

Demand Driving Supply

  • Lyft example:
    • Lyft gets a new rider
    • This rider takes a ride, meets the driver, and gets excited about driving
    • The rider becomes a driver

How to identify this growth dynamic

  • Given existing conversion, create a hypothesis that you could materially increase this rate of conversion, and build modeling to testify the hypothesis
  • Only lean into the loop if you're already seeing demand-to-supply conversion is already happening
  • Potential users who may convert to supply need to:
    • Know who you are
    • Know what you do and how you help them
    • Keep you top-of-mind when that need arises

You should look at...

  • Buyer-to-seller conversion rates in the first month, after the second month, and so on
  • Cohort-based views

How to measure

  • Low-latency cohorts analysis
  • To get more targetted, ask:
    • Who are the users who have a higher propensity to convert?
    • When are they most likely to convert?
    • Are users who do convert high-value or lower-value?
Related content
See all posts
Arrow icon