Unless you live under a rock you probably know that Snapchat is one of the most successful startups in history. Over 100M people use Snapchat on a daily basis sharing 9,000 snaps per second. This is the type of success that every entrepreneur dreams of achieving. Unfortunately, only a fraction of a percent will ever create a multimillion dollar company, let alone a multibillion dollar company. The question any true entrepreneur should be asking is "how did Snapchat do it?". 

Building a company as successful as Snapchat doesn't happen by chance or luck. The Snapchat team had to do a lot of things right at the right time to get to where they are today. 

In this detailed case study on Growth Hackers, Everette Taylor breaks down the steps Snapchat took to go from $0 to $20B in just a few years:

In an age of permanence, timelines, and revenge posts, Snapchat created a way for teens to share photos freely—without the ramifications of other social services like Facebook. The easy-to-use, self-destructing transiency of the experience feels more human in its interaction than regular MMS, Facebook, Instagram, and Twitter. It goes from a timeline point of view—a historic record of activity—to fleeting, in the moment captures that allow users to drop many of the filters we’re taught to put on what we share.

This freedom, combined with engaging product hooks, and social nature of sharing “in the moment” photos and video, created a powerful new venue and motivation for teens to switch over to Snapchat.

Snapchat knew what teens wanted and they knew that Facebook and Twitter weren't creating tools to address this need. 

To help foster the sense of privacy and security, Snapchat includes a built-in alert which notifies the sender if any of the recipients took a screenshot of the photo. Combined with the self-destructing nature, the app actively discourages the saving of photos. This creates less inhibition for users and an overall more fun, care-free experience.

In addition to photos and videos, Snapchat lets users express their creativity by adding text and drawing on the photos. This allows the user to create all types of goofy images and fun things that add to the experience.

While privacy of Snapchat is the obvious benefit, it also has some more subtle, but equally important benefits: disappearing photos mean less digital clutter, removing the cognitive overhead of dealing with them, and saving memory on phones.

While these benefits may seem trivial, upon closer inspection they provide real value. How many of us have a friend who’s computer of phone is crippled by thousands of unmanageable photos that are too hard to access, index, and use, but that can’t be deleted for fear of losing one that matters? Snapchat allows users to capture and share, without worrying about archiving and management.

Again, Snapchat knew what current social media and communication platforms were missing (privacy and security) and built their app with this in mind. They also didn't take anything for granted or consider any feature too small or trivial. Some of the most seemingly trivial features have the biggest impact on their success.

This popularity and word of mouth between teens was an integral part of Snapchat’s growth with not only their peers, but also with their parents. In fact, as kids moved to Snapchat, parents quickly followed, as the service became a way for teens to communicate with their parents. This dynamic created a demographic divide among Snapchat users. Most users are in the 13-25 age group, and a second, much smaller but growing, group 40 and older. (Source)

We verified the importance of Word of Mouth by surveying over 100 Snapchat users, asking them how they discovered it. 65% claimed they discovered it through word of mouth, with the rest saying it was invites or press. 

Word of mouth has been a key part of Snapchat's success along with the success of most of today's hottest startups like Facebook and Uber. If you can build a very loyal tribe for your startup early on then you will have the most powerful growth engine possible. 

You can read the entire case study here.