# Product-Led Growth

> Every company needs a Go-to-Market motion. Do you know what yours runs on? If Word of Mouth and self-service drives your revenue, then your company relies on Product-Led Growth (PLG). Successful PLG companies obsess over two things: an intuitive product, and virality. This flywheel comes from how many new Sign-ups are driven from existing ones. PLG companies run best on quick sales cycles and strong social sharing.

Published model on Paths: https://getpaths.io/p/product-led-growth
Values below are the base case of the published snapshot.

## Drivers

- Sign-ups: 2,000
- Activation Rate: 35%
- Conversion Rate: 8%
- ARPU: $1,800.00
- Viral Coefficient: 25%

## Formulas

- Activated Users = Sign-ups * Activation Rate  -> 700
- Paid Users = Activated Users * Conversion Rate  -> 56
- Self-Serve ARR = Paid Users * ARPU  -> $100,800.00
- Viral Sign-ups = Sign-ups * Viral Coefficient  -> 500
- Viral Activated Users = Viral Sign-ups * Activation Rate  -> 175
- Viral Paid Users = Viral Activated Users * Conversion Rate  -> 14
- Viral ARR = Viral Paid Users * ARPU -> $25,200.00
- Total ARR = Self-Serve ARR + Viral ARR  -> $126,000.00