I attended a shareholders meeting last night for a small start-up.

The marketing manager mentioned their “viral coefficient”.

I had to raise my hand and ask what a viral coefficient actually is. The embarrassment was only slightly lessened when the majority of other people in the room confessed they’d never heard of it either.

Embarrassment quickly turned to shame once it was explained to me. It’s such a simple concept and one I really should have known.

I’m operating on the assumption that some readers of this blog may not be familiar with the concept either. So to save you embarrassment , here it is:

A viral co-efficient of 1 means each of your customers in turn brings you one more customer. It’s as simple as that. So a coefficient of 0.5 means every other customer brings you a new one. 0.1 would mean one in ten customers bring you a new customer.

So the goal is to achieve as high a number as possible. I’m told Facebook has a viral coefficient of 12. So each user brings in 12 others. A nice position to be in as once you pass 1, your users/customers grow exponentially.