Known-and-Unknown Growth Portfolio
Fund predictable channels now while building asymmetric distribution for future scale.
- Difficulty
- Expert
- Time to result
- ~months to results
- Steps
- 7
- Confidence
- 96%
Build a portfolio containing known growth and unknown growth. Known growth comes from channels such as paid acquisition or established search programs where returns can be estimated, but competition often limits leverage. Unknown growth consists of differentiated channel strategies, product loops, partnerships, formats, or emerging opportunities with uncertain forecasts and potentially disproportionate upside. Plot opportunities by impact and leverage, then maintain enough predictable lower-leverage demand to keep the company operating while disciplined experiments search for high-impact, high-leverage distribution. The goal is not permanent balance. As an uncertain bet becomes repeatable, its share of demand should grow while dependence on expensive mature channels declines. This approach recognizes that predictability alone may not generate the tenfold growth expected of venture-backed startups, while a portfolio consisting only of speculative bets cannot reliably support sales plans, budgets, or near-term survival.
Origin
Extracted from Marketing Against The Grain
Core principles
- 01Distribution must become repeatable, forecastable, and economically sustainable.
- 02Mature channels provide predictability but usually offer less leverage.
- 03Asymmetric growth comes from differentiated advantages in existing or emerging channels.
- 04Predictable channels buy time for uncertain high-leverage bets to mature.
- 05The channel mix should shift toward higher-leverage distribution over time.
How to run it
- 1
Map the Channel Landscape
List plausible distribution channels and score each by potential impact and available leverage. Leverage means a differentiated reason the company can outperform average competitors in that channel.
Pro tip Include advantages built into the product as well as advantages in go-to-market execution.
Watch out Do not equate a large channel with an economical channel.
- 2
Separate Known and Unknown Growth
Classify forecastable programs as known growth and uncertain asymmetric bets as unknown growth. Give each group an explicit role in the plan.
Pro tip Keep separate assumptions and confidence ranges for the two portfolios.
Watch out Presenting speculative demand as committed forecast creates false confidence.
- 3
Secure the Predictable Base
Invest enough in proven channels to create near-term demand, support the sales team, and give experiments time to mature.
Pro tip Optimize for adequate coverage rather than making mature channels the entire strategy.
Watch out Predictability without leverage can become prohibitively expensive as competitors bid against you.
- 4
Design for Differentiated Leverage
Find a feature, content mechanism, partnership, audience advantage, or unusual execution model that makes a channel work better for your company than for others.
Pro tip Search for intersections between a customer need, an underused channel behavior, and a unique company asset.
Watch out Copying standard channel tactics rarely creates an asymmetric outcome.
- 5
Apply Rigor to Unproven Bets
Define hypotheses, milestones, budgets, and learning goals for each uncertain play. Run enough repetitions to distinguish a weak idea from poor initial execution.
Pro tip Measure signs of compounding or improving economics, not only immediate revenue.
Watch out Creativity without process produces interesting activities rather than a distribution engine.
- 6
Promote Repeatable Winners
When an unknown bet demonstrates repeatability, improve forecasting and increase investment. Reduce dependence on lower-leverage channels as the winner scales.
Pro tip Document the mechanism producing the advantage before assuming it will persist.
Watch out Scaling before understanding the mechanism can destroy the economics that made the channel attractive.
- 7
Refresh the Portfolio
Continue searching as channels mature and advantages erode. Maintain a pipeline of experiments even after finding a major winner.
Pro tip Review leverage separately from current volume because a large channel can still be weakening.
Watch out A distribution advantage is rarely permanent.
In the wild
Early HubSpot demand relied heavily on paid acquisition, giving the sales organization a predictable flow while search was still developing. As the search engine matured and inbound content gained leverage, search grew from a minority share to the dominant source of demand while paid became smaller.
→ Predictable demand bought enough time for a higher-leverage channel to become the primary distribution engine.
Common mistakes
Optimizing Only for Predictability
Established channels may generate reliable results but lack the leverage needed for venture-scale growth.
Betting Only on Novelty
A portfolio of uncertain experiments cannot reliably support near-term sales commitments or operating plans.
Calling Standard Execution Leverage
Using the same mature-channel tactics as every competitor does not create a differentiated advantage.
Is it for you?
Best for
It is best for growth-stage startups that cannot reach their targets through saturated acquisition channels alone.
Not ideal for
It is not ideal for stable businesses whose growth goals can be met economically through established channels without venture-scale expansion.
From the transcript
“you have to invest in a predictable and forecastable distribution engine”
“I would have bigger bets and the high impact High leverage that are unknown growth but we believe this accounts for 50% of the overall…”
“you're trying to kind of have an inverse relationship between your low leverage and high leverage channels over time”
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