Growth Loops

---
name: growth-loops
description: Build self-reinforcing growth systems where user actions generate inputs that acquire more users, compounding over time
---

# Growth Loop Frameworks

## Overview
Growth loops are closed systems where user actions create inputs for acquiring more users, forming self-reinforcing cycles. Unlike linear funnels (ad spend → users), loops compound: users → content → SEO → more users → more content. Reforge's framework: Viral loops, Content loops, Paid loops, Sales loops.

## When to Use
- Designing sustainable growth vs. paid acquisition treadmill
- Building network-effect products
- Content/marketplace businesses
- Optimizing user-generated growth

## Core Loop Types

**Viral Loop**: User invites → new user signs up → invites others
**Example**: Dropbox referrals (both sides get storage), Hotmail signature

**Content Loop**: User creates content → SEO/discovery → new users → create content
**Example**: Pinterest pins, YouTube videos, Medium articles

**Paid Loop**: Revenue → ads → users → revenue (must have positive LTV:CAC)
**Example**: E-commerce: Purchase → Facebook ads → purchase

**Sales Loop**: Customer success → upsells/references → new customers → success
**Example**: B2B: Happy customer → referrals/case studies → enterprise deals

## Design Process

1. **Map User Journey**: Identify where users create value (content, invites, purchases)
2. **Close the Loop**: Connect output back to acquisition input
3. **Optimize Cycle Time**: Faster loops compound faster
4. **Remove Friction**: Maximize % of users completing loop actions

**Example**: Yelp loop: Diner → writes review → review ranks in search → new diner finds restaurant → writes review (cycle time: 1 week)

## Example Application
**Before (Linear)**: Spend $10K on ads → 1,000 users → done
**After (Loop)**: 1,000 users → 100 write reviews → reviews rank for 500 keywords → 5,000 organic users → 500 reviews → 25,000 users (compounding)

## Anti-Patterns
- ❌ Confusing growth hacks (one-time tricks) with sustainable loops
- ❌ Ignoring loop leakage (% of users not completing loop action)
- ❌ Optimizing one part without measuring full loop health
- ❌ Treating all growth as equal (loops >>> linear funnels)

## Related
- network-effects
- viral-coefficients
- growth-accounting
- compound-effects