New Relic

Cloud-based observability platform, New Relic, helps its customers build better software by simplifying instrumentation. (Nordstrom Rack actually reduced downtime by 80% with insights from the New Relic dashboard). A focus on good data, and implementation of usage-based pricing, has led to steady growth both in the company’s accounts as well as data ingestion, two leading indicators of continued success.

We recently sat down with New Relic’s SVP, Demand Generation, Brian Kotlyar, to see how the company structures and operates its growth team.

Team Structure

The growth team at New Relic is 170+ people strong, and organized under single-threaded owners for each stage of the funnel. Each owner has direct reports from marketers, product managers, or engineers based on their team’s function. Members of cross-functional teams such as analytics or design form a matrix structure in which they report to multiple leaders, on a project-specific basis.

Outside of growth at New Relic, there are product teams responsible for developing or maintaining whole portions of their extensive platform. Although they have shared processes and objectives in place, these teams operate independently from growth.

Brian Kotlyar, SVP, Demand Generation, New Relic

“To drive growth, you must set quantitative/measurable targets, set dates for when you want those targets to be achieved, and then create and execute plans to achieve them.”

Growth Processes

A measured approach is critical to how New Relic grows. Here’s a high-level look at their process for defining their growth strategy.

1. Build your base case

Using data wherever possible, New Relic begins with a model that incorporates all the contributing factors influencing how the business functions. This helps develop a baseline or base case in which they consider how the business would be impacted if that status quo remained, or if nothing changed.

However, as a high-growth organization, the status quo is certainly not an option for New Relic. At this point, the question becomes: where do we want to go? Their answer defines the delta or the gap between where they are now and where they want to go.

2. Identify what moves the needle

Having built the model around the base case, the New Relic growth team then tries to understand all the factors that drive performance. This starts with identifying the most sensitive variables to change (In New Relic’s case, how many people sign up and log in)

As Brian Kotlyar describes, the growth team must: “Learn the sensitivity of different aspects of [their] business to intervention”.

Through this exercise, New Relic can understand which actions have the potential to significantly move the needle and accelerate growth.

3. Craft your hypotheses

The process continues with the development of hypotheses about the impact of these changes on their business.

Say, for instance, Brian Kotlyar and team are targeting product retention rates — their hypotheses might involve the effects of changes to variables like their onboarding screens or activation sequences.

4. Develop and prioritize business initiatives

With a hypothesis in place, the growth team develops a series of key business initiatives to achieve their stated objective. Some of these initiatives are driven top-down, must-dos developed by executive FIAT. But the majority of initiatives are driven by sub-teams with Growth. This is a thoughtful decision-making process where risk, effort, and upside are all balanced.

The result is a "portfolio of bets” that balances low to medium effort projects with a high certainty of success and low certainty but high potential impact projects.

5. Execute against plan

Finally, the time comes to execute. With a solid foundation in place, the New Relic team can test their hypotheses, enact each initiative, and realize its vision for growth. This is, according to Brian Kotlyar, “The process that's always running in the background of everything we're doing.”

Tool Stack

Brian Kotlyar, SVP, Demand Generation, New Relic

“Data is both your measuring stick and your dousing rod. It helps you determine where you are and your progression toward where you want to be, but it’s also the raw material that helps you understand where to focus your efforts to grow faster.”

Secrets to Success

1. Follow the data

The secret to success for growth begins and ends with high-quality data. That’s why a customer data platform sits at the heart of New Relic’s tech stack, giving them a consolidated view of the quantitative data they need to run experiments.

As Brian Kotlyar summarizes, “Data drives our understanding of where we are, where we're going is driven by it, and all of our decision making is informed by it… it must exist or else we cannot function.

2. Hire hungry, impatient people

Like many organizations, one of New Relic’s greatest strengths lies in its people. As their business grows, the emphasis on hiring right remains constant. Brian Kotlyar outlines several qualities which he and his team believe align with success in growth roles.

These traits include individuals with a growth mindset of continual learning, those with a hunger to drive results, and effective decision-makers that can balance quantitative data with qualitative information.

“Look to hire people with impatience or hunger, who want results today, not tomorrow or the week after,“ says Brian Kotlyar.

Learn from the best in the business

Our research reveals key insights about how to build and operate your team for optimal performance. From team structure to growth processes, you’ll learn from companies like Hubspot, Shopify, and Lyft on how to lead your team and company to rapid growth.

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