Growthink

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Dave Lavinsky

Founder, Growthink

$1M

revenue/mo

Founders

Employees

Growthink

growthink.com

from Los Angeles, CA, USA

started September 1999

$1,000,000

revenue/mo

Founders

Employees

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Hello! Who are you and what business did you start?

My name is Dave Lavinsky and I’m the co-founder and president of Growthink. I co-founded Growthink 25 years ago to write business plans for entrepreneurs. Today we still do that, but we also offer business plan templates and software and run an investment bank, Growthink Capital, to help companies raise capital and conduct M&A.

Today, the Growthink family of companies has helped over 1 million entrepreneurs with business planning and capital raising.

What's your backstory and how did you come up with the idea?

In 1999, during the dot-com bubble, I was graduating from business school at UCLA. I was launching a juice business at the time and was hoping to pursue it full-time upon graduation. One day, my wife came home and told me she was pregnant (with our first child) and wanted to quit her job. At the time, she was the sole breadwinner, and so I had to find a way of bringing in income.

Having written business plans before, I decided to write business plans as a side hustle. It turns out that the demand for this service was high, so, I pursued this business full-time.

After writing business plans for clients for a few years, I recognized that most entrepreneurs can’t afford a firm to write their plans for them. So, I developed business plan templates and software to sell them at much lower prices.

Entrepreneurs just starting out should start companies they are passionate about. If you’re not passionate about it, you’re not going to be great at it. And to succeed, you need to be great.

Take us through the process of building the first version of your product.

The first version of our business plan template product was created from an internal document we used as a reference when creating business plans for our clients in our consulting division.

I wanted to get it perfect, but knew that wouldn’t be possible without having lots of users try the product. So, we launched with a version that I thought was very good but knew wasn’t perfect.

That version still took me about 3 weeks to create. While, as mentioned, we had internal documents, those were created for an internal audience that was mostly MBAs with tons of business experience. Much of our clientele, rather, were academically of a lower caliber.

They were starting restaurants food trucks and nail salons, among other businesses, and needed a much more accessible template to use. So I spent about 3 weeks making it easier to use and particularly making the financial projections portion more flexible so it could be used by any type of potential business.

Fortunately, the only startup cost in developing the template was my time, so that didn’t factor much into my decision making.

Over the years, we have constantly solicited user feedback and improved our product to make it easier for our clients to use. Fortunately, our clients have been very vocal about what they like and don’t like about our products.

Describe the process of launching the business.

When I first launched Growthink, I didn’t know anything about search engine marketing, and Google wasn’t well known back then. So, I reached out to a bunch of entrepreneurial media outlets letting them know I was writing business plans to help entrepreneurs launch dot-com businesses.

While most outlets ignored my pitch, the Los Angeles Times wrote a story about me and the publicity resulted in hundreds of leads. I immediately started working 18 hours a day, 7 days a week to satisfy these clients. And I used the proceeds from these engagements to fund and grow the company.

The biggest lesson here was that the Los Angeles Times article proved there was a market for what I was offering. If the article ran and I received just a few leads, it would have told me there wasn’t a big enough market to pursue this opportunity. But the fact that so many people reached out to me after the article proved that a market exists.

After the significant number of clients from the Los Angeles Times story, there was a lull. I had spent all my time satisfying those clients and didn’t put any time into marketing and growing the business.

So, once things calmed down, I started thinking more strategically. It was at this time that I brought on my co-founder to help me grow the business. We both had some savings that we invested and also financed our growth with credit cards.

The first thing we did was to change the company name. Originally, I didn’t put much thought into the name and called the company “Best Biz Plan” since the URL bestbizplan.com was available. Once we knew there was a demand for our service, we wanted to have a stronger brand name and came up with Growthink.

Next, we focused on building a quality website. I built the initial website myself using the now defunct Microsoft FrontPage. So we hired a designer to build a much nicer site. Embarrassingly, this was the original version of our website in 1999 (in my defense, at the time, most websites were pretty bad)

We also found an office space that could accommodate our growth as initially, we were working out of my apartment. Finally, we hired our first employee.

At this point, we were getting some leads from people who had read the Los Angeles Times article and referrals from clients and colleagues. But since we had plans to aggressively grow the company, it wasn’t quite enough. So, we started going to lots of events and focusing on search engine marketing.

By 2001, we had 20+ employees and the business was looking good. But then we experienced the dot-com bust, which forced us to lay off employees. A few years later, in 2007-2008, we experienced the financial/credit crisis which also hurt our business. Once again, we shifted some full-time employees to part-time and lowered our burn rate so we could survive. Fortunately, these downturns prepared us well; we built a business that could grow and account for crises like COVID-19.

One thing I’ve learned is that short-cuts generally don’t work. Yes, sometimes it’s easy to take the easy road and get things done at a minimum level of quality. But this often comes back to bite you. So, anything that’s important, we now do right the first time.

Since launch, what has worked to attract and retain customers?

We have invested heavily over the years in creating lots of high quality content for our website. This has helped with search engine optimization. We spend a lot of time tracking our website metrics. So, we look at things such as what pages people are visiting and how long they are spending on these pages. We use this information to improve our website.

We also use search engine marketing, particularly pay-per-click advertising to reach new clients. While this has gotten more expensive over time, it’s a fantastic way to reach prospective customers looking for the exact services we offer.

Newsletter marketing is another tactic we have used to attract and retain customers. I write a daily newsletter that teaches entrepreneurs how to start and grow their businesses, and I’ve received lots of positive feedback from them.

The result of these efforts is that we have now helped over 1 million entrepreneurs develop business plans with our free and paid tools and serve over 15,000 paid clients annually.

How are you doing today and what does the future look like?

Today I have been focused on leveraging AI in our business. We have streamlined some monotonous tasks (e.g., basic Q&A) using AI. We also use AI to draft certain content and social media posts.

Importantly, I have been investing significant effort in launching our AI business plan generator PlanPros. This has been more challenging than I thought it would be. But this software will enable entrepreneurs to write amazing business plans in just a few minutes.

On a daily basis, my schedule is a lot different than it was several years back. I now have a team that handles most of the day-to-day operations, and I am more focused on growth.

Revenue-wise, our company has grown into an 8-figure business when we add in all of our business units. We still serve thousands of customers with low priced $97 templates. Others pay us $10,000 or more to develop their business plans for them. And still, others have paid us much larger success fees for helping them raise capital or sell their businesses.

Through starting the business, have you learned anything particularly helpful or advantageous?

One thing I’ve learned is that short-cuts generally don’t work. Yes, sometimes it’s easy to take the easy road and get things done at a minimum level of quality. But this often comes back to bite you. So, anything that’s important, we now do right the first time.

One thing I did right was choose the right co-founder. My co-founder and I have been running Growthink for 25 years. That’s a long time. Most importantly, before we started, I knew I could trust him. I think trust is the key. While we disagree about a whole bunch of things, because we trust each other, it works. Also, we have complementary skills – I’m best at marketing and he’s best at sales – and I think that has helped us.

What platform/tools do you use for your business?

We use Google Workspace for our email, spreadsheets/documents, and team collaboration and have found it to be very good. We use Infusionsoft as our CRM and for e-commerce in one business line and we use Recurly in another.

We rely on SEO tools like ahrefs and SemRush. And we use Slack to communicate with each other as we have team members located throughout the world.

What have been the most influential books, podcasts, or other resources?

I am very proud of the book I wrote called “Start at the End” which has helped thousands of entrepreneurs start and grow their businesses.

Other books that have inspired and helped me over the years include Seth Godin’s “Purple Cow,” Jay Abraham’s “Getting Everything You Can Out of All You've Got,” and Michael Michalko’s “ Thinkertoys.”

Advice for other entrepreneurs who want to get started or are just starting out?

Entrepreneurs just starting out should start companies they are passionate about. If you’re not passionate about it, you’re not going to be great at it. And to succeed, you need to be great.

You should also start companies that leverage your skills. If you’re great at marketing, make sure that marketing can be a key ingredient to your company’s success. Likewise, if you’re great at managing teams, make sure that could be a key success factor.

Finally, make sure to get feedback from your target customers quickly and frequently. You can build the greatest widget/service in the world, but if there aren’t enough people who want it, your company won’t be successful.

Are you looking to hire for certain positions right now?

While we don’t currently have any official job openings, we are always looking for great people to help us grow.

Where can we go to learn more?

If you have any questions or comments, drop a comment below!

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