🔥 Tier 1 - Must KnowID: growthLoop
Growth Loop (Self-Sustaining Compounding System)
A closed system where the output of one cycle feeds back as the input for the next cohort
In Simple Words (Zero Jargon):
A cycle where every new customer automatically brings in more customers (e.g. User signs up $\to$ shares a document $\to$ colleague sees the logo and signs up $\to$ repeats).
Why It Is Critical
Funnels are linear: pour $1 in ad spend $\to$ get 1 customer $\to$ stop. Loops are compounding: 1 customer brings in 0.5 more customers, reducing blended CAC over time.
'A funnel asks: How do we get more people into the top? A growth loop asks: How does every person coming out of the bottom bring more people in? The second question makes growth compound without endless ad spend.'
What You Get: A growth engine that gets more efficient as it scales, instead of one that requires proportionally more ad spend for each unit of growth.