How to Grow Your Self Funded Business Faster – Hiten Shah – MicroConf 2014

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0:07[Music] all right uh micro Kampf I got so much to say so everyone can hear me everyone's awake yeah no all right okay where do I begin so this is my favorite conference I've been to a lot of conferences over the last ten eleven years almost about technology and it's yeah I don't want to miss it for the life of me KISSmetrics is sponsoring it this year that took some convincing from our marketing person but I'm just kidding it was easy and so the reason I love micro comp is cuz it's all about self-funded entrepreneurship I'm specifically today gonna talk not about tactics and I'm actually going to talk about a whole

1:02bunch of stuff that is related to things that I think matter as you're a self-funded entrepreneur ways to think about different stages of your business and kind of a few other things this is stuff I haven't talked about before and you probably won't get a lot of tactics for me because the conference is full of tactics and so the biggest thing that I keep hearing and I know some of you that have talked to me about this understand my issue here is that a lot of people consider themselves bootstrapped and I think that's incorrect we don't have straps we don't have boots we don't pull ourselves up from them it's a very

1:37old terminology so I would encourage all of you to use the word self-funded if you haven't raised money and if you're self funding your company so we should be proud of that and I think bootstrapping takes a little bit of that away from us so that's my rant about that but more importantly the one thing that I would say that is sort of probably most exciting for me and I promise I'll get away from philosophy pretty soon this is the last slide of that maybe not but is this idea of freedom of time and in my experience there's basically two ways that you can get that

2:13one way is that you are start start some business either you raise money or you start the business and you sort of then raise money and then you keep raising money and then you end up like the founder CEO of voxcom who has 4% of the company before they go IPO and yes he's going to make hundreds of millions of dollars but that's kind of the common situation when you raise money is you end up with a very small percentage of the business and I think Rob was actually telling me to or he was he was saying there's a unicorn study that says 34 out of 10,000 companies that raise

2:51money I guess they end up actually having an exit having a billion dollar exit so that's one way to get freedom of time you raise a bunch of money and you you grow a business and you have thousands of employees and then you sell your company that's very uncommon but you do end up having freedom of time you have tens of millions of dollars if not hundreds of millions of dollars then you get to do whatever the hell you want with your time the the reason I'm excited about this conference I'm excited about the opportunity all of us have is that we can get freedom of time in a different

3:21way and the way we can do it is we can sit there build our own software charge actual customers for it and just start making money and do whatever we want and that's what's exciting I think more people in this world can get that compared to raising money and selling a company for millions millions and millions of dollars or billions of dollars or going public so anyways that's my rant it's over that's why I'm here this is very exciting for me it should be exciting for all of you I was gonna have my friend do a dance but he didn't want to do it I almost convinced him he

3:54was almost there and it was it was to that song happy and one of the reasons is we should all be happy we don't have investors we shouldn't be thinking about them and we get to figure out how to make money and we're in a conference where people can help you if you're at a phase where that's what you need so there's this concept regardless of what you kind of what kind of weather you raise money or not or you know if you're building software that has kind of stuck with me and it's this idea of pirates versus explorers so I'm gonna explain it and then we'll go on so explorers

4:28explorers are the people that just want to build something new just because it's new I can call out people in this room that are explorers there's a there's a sort of the idea that they don't want to build something someone else's built they don't they don't they think about it like this basically whatever I'm doing is revolutionary and then there's pirates pirates are sort of my favorite in a way just in general because what they usually do is they're fast followers and they chase sort of things they want to steal other people's loot and so this is a this is a concept that took me a while to understand because I

5:05was skewed one way and I needed to quantify that for myself because it really based on this and which one you are essentially what spectrum you are on this the way you build software the way you think about software the way even think about running your business is going to be vastly different and so the way I like to say it is you know explorers are very Discovery centric so you want to discover new land new things new opportunities you're usually first mover's which which is good and bad and you're usually looking really to solve problems in unique ways and then as pirates you're more market centric so you're thinking a

5:43lot about your competition you're thinking a lot about sort of the market where it's gonna go how big it is and things like that you're also thinking you're also thinking that like you can if someone's built something you can build it faster than that basically and then they're very focused on building the solution just because they they look at the world and they think in solutions not in problems so what I'm curious about is how many of you would continue to consider yourselves more like a pirate awesome and when everyone else be the Explorer do we need to raise our hands on that awesome suite okay so it's

6:17actually pretty even mix and I'm glad it resonated with you guys because this is the first time I've talked about this and it's something that actually defines how you build software how you think about building products and things like that and some of the people I would have guessed actually fell on the right campus to what I would have guessed and I think it's a spectrum what I what I what I can tell you is if you start a company one way it's very difficult to make the company work the other way and so just be conscious when you're starting or even right now which one are

6:45you how do you think about the world what what makes you get up in the morning and actually want to write code talk to customers sell your product you know whatever it may be all right so my philosophy is really over now now it's gonna be very tactical hopefully now I'm just getting still strategy so that's what I'm supposed to talk about today and so and that's what I wanted too because I've talked about tactics you're gonna hear a lot of tactics you're gonna get those three sort of takeaways I wanted to give sort of a better framework based on things that I've learned so this is actually a revenue

7:20graph of crazy egg and the three phases that I'm gonna divide up the rest of the talk in is start scale and grow and so before I get into it I'm curious who's just starting you barely have a product it's an idea I know we did a poll but like this is a little bit different okay great who's scaling scaling is like you have something you need to figure out what to do next okay and then who's growing growing is like you might be spending money on acquisition things like that awesome okay cool so it's actually relatively even I think we're stacked a little bit on start so I'm

7:55gonna talk about these three phases and I'm in first I'm gonna talk about this little formula I'm not an engineer I fake it I know engineers like formula so this is the formula it's basically focus sequence equals speed and there's a different way to think about these three things depending on what phase you're on so the way I think about it is that at any given point in a company I don't care if you're venture backed or self-funded in this case all of you are hopefully self funded don't raise money trust me I've done it and the way I think about it is you can only go as fast as you can if

8:33you figure out what you should be focused on right now in the phase that you're in and if you figure out how to sequence the things you need to do to move as fast as possible so that that's kind of the formula I like to use to think about kind of where you're at and what you should be doing so in the start phase my our graph look like this this is our revenue graph it's not monthly recurring revenue it's straight-up revenue and the reason is it's kind of if you notice between the start and the end it actually didn't grow that much and you'll see in later

9:04slides that it grows more and you're really just trying to figure things out and when you're trying to figure things out and you're just starting out which are what you're trying to do is what I call fine find the pain and and this is like customer pain like what's really painful what's what's causing people you know what's gonna solve this guy's problem what's gonna make him feel better about being beat up in the boxing ring and that's really what you're trying to find out I mean if you think about your customer you can think about them like this this little dude that's sitting there looking pretty bad usually

9:35they don't even have their helmets on though or boxing gloves but you're looking for that thing that that that's really painful for your customer the thing that you can sort of attack and so I'm going to talk a little bit about that but this is the formula I would use it's the pain so you're looking for that pain and then what you're sequencing and what you're really trying to try to do is build a product that solves that problem and it might take a bunch of a bunch of these MVPs or iterations or whatever you want to call them that actually get to you to what I would call

10:03fit and that's basically product market fit again you know I'm gonna talk about concepts if you don't know these concepts please just google them that's what Google is there for and you'll hear a lot of a lot of tactical stuff later on and the reason is I want to go really fast through these concepts because the the what I've learned is that there's just a lot of content out there many of you blog i blog sometimes my co-founder blogs all kinds of people blog and all the contents out there so I'm going to talk about some of the concepts that sort of I found very interesting when it

10:34comes to how people tend to find pain so one is personal pain this is this is one of my favorites to talk to entrepreneurs about so how many of you started your company with a personal pain so this is a pain that you had a problem that you had awesome great does it ever feel like that where you're hitting your head against the wall you can admit it it's okay so I've noticed that what happens is you'll see waves so you'll see you'll see categories of software products be built just because somebody was trying to build that themselves and they decided they could turn it into a

11:12business this is a very common pattern in technology today and I think it feels like that I've personally been there and it's sometimes it does feel like that because it's like I built it I built how to build it other people got to have that problem so I'm gonna go start my business that way and then you end up learning all kinds of things that make you sometimes feel like that so the next concept would be Lean Startup so it has anyone here not heard of Lean Startup Wow great has anyone here read the book all right many of you great so I don't use this terminology anymore I don't use

11:49pivots or MVPs too much and the reason is I think there's a lot of misconceptions about it I think this cartoon basically describes the biggest misconception that I get which is lean means cheap or lean means you're spending less money and and so that's kind of what's happened with Lean Startup but it is a very good way to find pain there are a lot of tactics in there in short it it from my perspective it just helps you be more scientific about your startup about your company and and how you sort of build it but it has nothing to do with cheap the next concept which is a little bit different

12:24is customer development again how many of you have heard of this concept awesome have you read any of the books on it there's a bunch of books on cool how about blog posts awesome cool so there's a bunch of people I've written good stuff Cindy Alvarez Jason a vanish Kevin de Walt my friend Patrick somewhere in this room probably and he's around you should bother him where is no another Patrick not that Patrick although he's written about it too he's back there if you want to know about customer development you should bother him he wrote a little blue book about customer development that's the best book on the topic anyways it feels like

13:04this if you're doing it wrong if you're doing it wrong you're telling people this is my solution you should buy it and that's not what customer development is about customer development is about finding pain I like to use it as a process to get painful stories out of people that I'm talking to so again customer development next has anyone heard of the sales Safari by Amy Hoya awesome has anyone done one awesome so what it is is basically the idea that you can go online and go really figure out what pain people have by looking at forums and all kinds of other places where people are posting online even

13:40Twitter searches and things like that sometimes it feels like this where you're only getting the perspective that people have expressed digitally and so that's why I use this cartoon specifically just because sometimes you need other perspectives but also it's a great tactic at finding pain she's got a whole bootcamp and a whole process on how to do it when you're starting out it's all about finding pain all these tactics will help you the next one is one of my favorites and it's a new one that I've been sort of studying it's called jobs to be done or the switch method has anyone heard of this oh cool

14:14also more people than I thought so this cartoon is actually interesting it's basically the guy saying I got all these problems and there's only one solution to them which is Prozac and jobs to be done the whole process and the whole way it works is the philosophy and the ideology is that people are hiring your software your product to do a job and and you need to identify what job they're hiring your product to do and a lot of it has to do with situational analysis so what situation are they in when they decided to hire your product it's really cool you should look it up

14:46there's podcasts there's a lot of content about it there's an awesome milkshake video about clay Christensen who came up with the concept talking about why people hire basically what job it doesn't milkshake do why do people hire a milkshake and what job does it do in the morning so this is the one that's kind of new and fancy now one thing you'll notice about all these different tactics to find pain is that they're all a little bit different they're all a little bit simpler it really just depends on like what your schema is if you don't really want to talk to people on the phone or Skype or in person then

15:19you might want to do a sales Safari if you don't mind talking to people but are very biased when you do it you might want to use jobs to be done or some very structured process to kind of understand the paint but either way please figure out the pain otherwise you're basically gonna build things people don't want and that's not what you need to be doing especially when you're trying to move as fast as possible and are self-funded and it's your own money this is another one that's just a quick aside a lot of people are afraid of charging for their product just in general or they're

15:51charging too little which is a whole different story so one thing I would say is charge people early there's probably the one case study that I can say is is the most interesting in charging people early that is a SAS product and at the time it was self-funded so it's the folks at buffer and there's a whole bunch of blog posts about how they did it but even before they built the product they just had a landing page and it said seed plans and pricing or plans and pricing and then it went to a kind of get notified sort of screen so they were all ready when they first started

16:22testing this idea that people will pay for this product and then the next step they went into was kind of the next one on the right where they actually put a pricing page in the middle and then they went to sort of the get notified screen so I would encourage all of you start charging even maybe before you have the product if you can pull that off it it's really one of the key indicators to determine whether there actually is pain and somebody gives a or not and if you're really early and you just have like an idea or maybe have two or three ideas or two or three different ways you

16:48can approach it you can create two or three of these different sort of landing pages I've even done these once a product is much more mature just to see if I can get extract more money out of people or more value that I can provide them when they're currently using the product this kind of last but not least for the start period for me and the way I think about it I think size does matter and and what I mean by that is when you're self-funded and you're trying to build a business the market size is important and the reason for that is that you might not see it in the

17:20beginning but as you start getting through the other two phases of scale and grow you'll notice that if you can't get enough customers to come to you and you have a you know at most it's like a thousand or ten thousand customers you might need to build a heavier organization with a sales process and things like that that become difficult as a self-funded company because in those scenarios you have to invest in people before they actually are producing anything of value to the business in terms of revenue and things like that for example for a sales rep the average ramp time is three to six months which

17:51means you hire them and they won't be at quota until three to six months which means they're probably not making you money for a while and so the size of the market your ability to reach the market is actually important to make sure that you can scale the business and grow the business scale so this is this is the crazy I graph for scale it looks a little better I think we got better but you can see all this stuff is it's quite wavy and again this is revenue not mor if it was mr r it would look pretty smooth because mr r always goes up and

18:22the reason I did that is because I wanted to sort of show some of the bumps and you'll see there's sometimes some patterns and the first two humps that just have to do with things we figured out a B tests we ran things like that so scale at least for me it felt like this it felt like I had a house it was cool but the door was closed and there was money all around me and I didn't know how to get it in my house and that's really what it felt like it actually felt like this even it felt like I could do a million things at this point and if

18:57we I don't change anything at all things will be fine and that's why you notice those humps we spent a lot of time trying to figure out what to do and and there were a million things we could do and so I'm going to talk about how you should sort of get to this point where the money is just coming in your door and it's sort of not a problem so the formula for this that I think about is your goal is to make things repeatable and get to repeatability as fast as possible and I called it scale a lot of people would consider later stages scale

19:27but to me when it's early you've started you've hit product market fit the next thing you need to do is figure out all the things you're doing manually all the things that need to be sort of turned into systems and and be optimized so that you can actually make things repeatable and so I would focus on systems so systems are like you know the way people onboard your product the way that you actually acquire customers and figure out how what systems you need to optimize once you figure out the systems you need to optimize you start iterating around the optimization AV testing they you know making things more automated that

20:03are manual things like that one of the things I have noticed is that there's actually I've met some non engineers and a lot of you are engineers but I meant some non engineers that have actually built businesses with five figures and recurring revenue completely on Google Spreadsheets and a few landing pages and the way they did that is that they didn't really think about any of this stuff until they got to the point where they had to scale it and then they actually brought in software and started automating a lot more so the trend that I'm seeing is you can get really far in a business if you want to by doing a lot

20:35of things behind the scenes that are very manual and so when you get to scale you need to think about what are all the things you're doing manually what are all the things that are not repeatable yet and how do you make them repeatable and there'll be some talks I'm sure about some of this kind of stuff too one of the mistakes we made a lot and we stopped making it recently I'd say in the last year is that we would actually drive the business very blind and what I mean by that is we would think about adding a feature or we would think about a system we want to make repeatable and

21:04we wouldn't really think about the data we wouldn't think about the metrics we wouldn't think about the information I know there's some irony here I run a couple metrics companies but we really wouldn't think about it like that and and so what I would encourage you to do is think about where you're blind where you're not actually seeing the numbers where you're not thinking about what do we need to know what are the numbers what what are things that we need to improve I think Peter Drucker said it best it's basically what gets measured gets managed and in my experience that's so true so if you need to make something

21:32scale you need to measure it so you can understand what it is and this isn't just like things customers or visitors are doing we started measuring all kinds of things around processes I mean the simple stuff is like time it takes for support requests to be turned around other things are like like the time between when somebody signs up and when they actually you know do something meaningful in your product there's all kinds of things you could be measuring depending on what the systems are but if you don't measure them you won't be able to optimize them and iterate and this is this is kind of obvious where you know

22:04you're trying to optimize everything for learning and what I mean by that is the over optimize and actually make sure that you're maximizing how much you can learn because in this spirit period when you're trying to scale you've hit product market fit and and things aren't repeatable the the learnings are actually really valuable they're always valuable but in this case what I found is that you know you're you're you're always trying to learn about the customer and understand kind of what can be done but you also need to look outside and think about how do I make a lot of these things repeatable are other people doing things that I can be trying

22:35are there is there a better way to do it for my market things like that so this is a period of I'd say probably one of the largest learnings around kind of what your business looks like how much revenue you have and how you can sort of scale it to the next level and I've even been in the situation where like some of those bumps that we saw when we started getting increases in revenue we had no idea why when we were running blind - we didn't really think about the learning and go spend the time to figure out why is it that we made more money that month

23:02compared to the previous month and I would encourage you to actually learn all this stuff during this period and the last thing as I was saying was things are repeatable make things repeatable scale things things like that there is one thing that I found very valuable for myself and I think it's worth repeating back when we launched crazy act this was within the first I think three to six months we we had a 37signals actually do a heat map of their homepage and they're they're they're they they wrote a whole blog post about it and then somebody in the comments basically made me a line item

23:36for kind of why you know the pros and cons of crazy I gonna in a company at the time called clicks density and I happen to be a line item and says Heaton very responsive and helpful so about for the first two to three years of that business I was doing all of customer support and commenting everywhere I could whenever the product was mentioned I know this is a common practice now and I know I just talked about repeatability but like if I could find the bandwidth and I do sometimes I still try to do that as much as possible we also now have my co-founder Neil if you ever look

24:07at his brought blog quick sprout or even the crazy guy blog you'll see him commenting on literally every blog posts and things like that and I think that that builds a lot of trust loyalty and audience that him that can kind of make you a line item for why someone should go with your product versus another product you are basically the brand you are the company I think everyone that even works with you in your company even contractors and stuff represent your company to some extent so this is just something to think about as you're trying to make things repeatable there's things like this that kind of in

24:39my opinion shouldn't necessarily be thought of as repeatable or scalable or outsourced so grow this is a lot steeper graph this is actually the most recent growth for lack of a better word this is actually when we first started advertising we actually had no advertising until basically the beginning of this and so that's why you'll see some bumps and then some choppiness and then now we we've figured out a bunch of stuff on how to scale the business and more I think this is this is probably for me one of the most equally frustrating and exciting periods in a business I've seen multiple companies through all three stages now

25:16and and got to see a lot more and it's so frustrating sometimes to watch the revenue not go up are you not being able to dial the knobs and stuff like that but it is it is something to think about for a while we we kind of had this feeling and this it's this feeling that like oh we're making money we didn't think we would make this much money or have this much success even a year ago or two years ago and this is this is one of the things about SAS once it just starts working after a certain point it just keeps working like there's like you

25:50can make it work better but you could also feel like this like hey it's working I'm good and so I've been there and I think resisting that growth you know if you you bought your freedom of time and maybe you don't want to do more with it and you're happy with whatever you're doing and that's totally fine I'm sure you'll get bored though and that's what happened to us in a couple of instances and so in this period there's a big lesson that I've learned and I think it's it's a difficult lesson for some people but basically you're you're actually focused on traffic believe it or not and I'll explain why in a second

26:27and then you're also focused your sequences the iterations you do with that traffic and that leads to growth and so here's what I mean so at some point if you know you've hit product market fit you've figured out systems to scale the business and you've started sort of scaling but you might not have figured out actually how to grow and you know what the dials are for traffic and things like that one of the things that I've noticed after seeing lots and lots of a/b test more than I can count and lots of different types of businesses that when you focus on the top of the funnel

27:01excuse me everything below it just gets bigger and it also allows for a B testing to get statistically significant and relevant much faster so at some point if everything else is working you just start filling the top of funnel as much as possible and then run tests down the funnel as much as possible as fast as possible and that's what I mean by traffic and iteration that's really all it boils down to and traffic could be you know depending on what kind of business you are it could mean a lot of different things for most of my businesses traffic is either finding ways to grow word-of-mouth which is

27:35really key so there's all kinds of ways to do that and the second piece for us is just lots of content we do lots of blogging and that that grows the traffic and then over time we learn how to convert it and it's just simple math if you have you know if you double or triple the traffic at the top you will generally double or triple everything below it but you have an exponential effect if you can even double the conversion rate at one or two of those steps and then all of a sudden to 4x improvement but if you don't have enough traffic coming at the top then your

28:03tests might take months to get significant and that means that you're just not growing as fast as you can so I can't stress it enough that everybody that understands growth at this point understands that the top of funnel is actually more important than anything else once you hit this scale another thing I would say is growth comes from obsessing about your customers and if you do that then you will get the growth that you're seeking or looking for or that you deserve for lack of a better word and in all stages you're focused on the customer I think a growth some people tend to do less qualitative stuff

28:34less customer development things like that and in those cases you might not learn things that you should know like leading indicators for features or competitors or whatever it may be and what they're doing from your customers mouth so that you can sort of plan out how you add to the product we're actually in a very personal story on this one we're in an interesting place with crazy egg we're like we didn't think it would be as big as it is and it's pretty big right now but there's a there's there's a pattern that we're seeing around what people want next and and what they're doing when they leave our product a lot

29:11of the jobs to be done interviews and other things helped us understand this and so we're we have a big project to actually add probably an equivalent sized feature to what we currently have just so that we can expand the product and grow even more and we wouldn't have figured that out very easily unless we were actually talking to customers and had some hunches around that and so obsessing about them can really be helpful I wish we would have figured it out earlier because then we would have built it earlier this is also another sort of important point for me and it's all about time so at any given point

29:46especially during the growth phase you again you can probably do a million things although it's probably a lot more focused at this point and you know plans and things like that like I go back and forth whether I like planning or not and and you know some people say that you can't really plan that far out I'm pretty much generally an agreement to that but like I would just say that when you're growing time is still your scarcest resource it's the one thing that you kind of always have against you I think in life in general but also during these periods with the south's business so you want to use it wisely

30:18don't don't do things that are sort of futile or not worth doing and I've seen a lot of people get into that so they're like oh yeah now we have all this growth well how do I go I don't know do TV ads and believe it I've heard that from self-funded companies and stuff like that and without actually thinking about how that's gonna help the business or if there's some other thing that can help you're probably gonna make the wrong decision there's a lot of different methods for this this is actually the time when I do something that's not generally my personality but I will actually put out pull up a spreadsheet

30:49and start doing pros and cons there's actually a Benjamin Franklin method somewhere that's actually pretty cool you guys should look it up it's some prioritization matrix it's very good at helping you make decisions about one thing versus another thing or whether you should do something or not I actually tend to do a lot of that instead of planning just so that I can get to quick decisions about you know where to spend let's say money to acquire mutant new customers and things like that and this is the last probably but not least obvious thing which is you want to continuously make improvements you want to do that at all stages but I

31:21growth like I said it can be very easy to sit there and be like I'm good it's growing I'm done and sometimes it looks like growth but it's really just scale and you figured out some level of scale and so you want to continue our improvement you want to think about how can I make this better how can we grow more things like that and and if you've already set your systems up and figured out how to make things repeatable you've got enough freedom of your own time hopefully if you set those things up that you can start thinking about these kind of things the higher level things the

31:52things on like how do you add a massive feature to the product that's actually going to be good how do you research it how do you figure out what to do so I do want to end with this slide before my last slide and and and remind people that like this is the equation it's pretty simple if you figure out what to focus on and you figure out the order of things you need to do to make that go faster you will get faster you will get better at doing things also I feel like this all the time like I have all this energy I'm like Superman but I can't fly

32:22it and so I wanted to leave you guys with this slide hey you were talking about strategy within a company could you talk a little bit about the way you personally strategize across your companies so for example putting energy into crazy egg also takes time away from other things you could do how do you address that kind of strategy yeah you know I've been studying a lot about like personality types and things like that and I think I talked a little bit about that at dinner but the truth is like I'll tell you how I do it but it really only works for my personality type and so the the way I do

33:00it is that I like finding people that are really good at something like great at it better than me but yet I have enough knowledge to know like how they're gonna do something or I've done it before and and hire them it's that simple and sometimes they're contractors sometimes it's full-time people and so because for me I like to protect my time and I don't mean that like I'm not doing meetings many of you know I've spent time with you guys whether it's here even in on email or on the phone or whatever but it's like I want to be able to do the things that I

33:33want to do and I think for me letting other people do the things that I don't want to do or it's kind of my attitude so well every day I just try to think about is there something I'm doing that I shouldn't be doing right like I have even entertained outsourcing presentations but I realize that I can't do that so that's something I want to do with my own time but and outsourcing meeting just somebody to help me I don't also manage my own calendar because I want to manage my own time so I would say that like I have a lot of different businesses going on that need attention

34:01but most of the time I'm finding other people to put that attention and I'm generally you know my rule is like if something's I'm your first call this is what my dad taught me actually I was a kid but I'm your first call if something's wrong or if you're stuck and you have a hard problem in and I generally have my time open for those kind of situations with anybody that's working with me so that's it's kind of how I do it you know but I think it all depends on personality types there's friends of mine that are you know just want their hands and everything and so I think they have a

34:29different way to manage their time so they'll outsource a lot of the stuff that I probably wouldn't like calendars and things like that I have a question for you at one point you guys were using Gmail for support yeah right I think on KISSmetrics is that right yeah on everything we've done I mean and you guys have some pretty massive products why why have you stuck with Gmail and have you considered switching yeah so today at KISSmetrics we have a number of people and customer success and support so we're actually using help scout and the reason we're doing that is because it's there's just a better

35:04process when you have multiple people that we can use that with in that in that business there's there's a guy Lars running around here that works with us there you can ask him about how the workflow there it's it's been good for us at crazy egg which I think gets more support tickets than KISSmetrics but there's about one and a half to two people working on support there it's still all Gmail and we just found there's there's there's a labs feature called canned responses there's labels and then there's us doing a lot of when when instead of letting people have the email will actually have forums on the site so we can add a lot

35:37of diagnostic data or like you know well plan their on and stuff like that and we'll auto label into Gmail that helps us prioritize so I prefer Gmail still because I think I can get really far if not forever on Gmail are there any resources that you would recommend when you're trying to figure out like a pricing model or structure for your products early on yeah pricing thanks for that question oh I could do a 3-hour talk on that question especially for sass I'm very opinionated on the topic I guess I'll just give you like three things that that kind of I'll make them up right now but but they'll

36:25be good I think so one is I think what people forget is that if they're gonna tear their sales product they they they don't realize one thing and this is with not just hearing but just in general one is really focusing in on how your customer buys and and so what do they currently buy how are they paying for that thing and how can you align as closely as possible with that because to me if I'm inventing a new thing like charging our number of support tickets instead of number of support reps I better have a damn good reason and an insight that makes us ongoing against

37:01how every other product in my category charges and how the customer wants to buy so actually that's probably the biggest tip I have second one is that there's a book called strategies of pricing and tactics it's it reminds me of the books I I had in school I can I can link you guys to it but I think it's pricing strategies and tactics or something it's a really thick book it's kind of expensive it's like right around 60 70 bucks there might be some PDFs online that are kind of parts of the book it's the most thorough read on pricing and it has a lot of strategies

37:29around how to do it and the third thing is that I think people get scared about changing pricing and thing like that on their customers so the what the folks at woohoo did is they tested multiple price points but when people actually got billed they were just always getting charged the lowest price point so they could still measure the conversion across the price points but they still build the lowest price point the other thing that I've done is that generally you don't have a lot of word-of-mouth in a product when you're trying to figure out pricing so I'm not really scared to change the pricing on

38:01people and see what happens I will tell you that there are if you hunt around the internet you will find strategies without having to get people to put in a credit card to understand pricing so I'd probably do some research and figure those out as well there's there's some really cool stuff out there on that but I can link you to a bunch of it if you'd like to thanks for your talk I've got a startup that is firmly in the scale phase I think and if that like paralysis of there's so many things wrong with it and so many things I could possibly work on you know you mentioned collecting

38:35data but like how do you how do you choose where to start on that mountain yeah it's a good question I personally have a luxury where all the people that work on the SAPS products we have are people that understand data and analytics so we can whip up any stat pretty fast without even any of our tools like internal so so I mean the small small a couple tips if you're not logging things transactionally right now then you should be and what I mean by that is a lot of software's built in such a way where the last login is rewritten so instead of rewriting the

39:08last login log every login of a user and create a table so that you can do that and then that goes for almost any other thing you can do because it kind of analysis you're gonna want to do around user behavior and customer behavior is gonna be related to transactional sort of analysis and time series analysis and so that's the probably biggest tip I have on that the second thing is depending on what you need to what is the absolute thing what is the one system that is the most important system that you got to turn into a repeatable system that's going to determine what you measure so if if if

39:38you know you get a lot of traffic and you're not converting enough of it turning that into a system might be important and in that case it's like do you have the metrics to look at your funnel are you able to a be test and have a what I like to do is I have I like to have a test running all the time at the key parts of my funnel no matter what even if it's like just change Bowl make it bold right just so that I can have the practice of running it and that's what I mean by systems so it really just depends on specifics of what system

40:04makes the most sense I'm always happy to chat with you though if you if you need help figuring that one out right so instead of targeting anyone and everyone aDNA customer development how do you focus in on your most ideal customer yeah so there's a lot of there's a lot of content out there and that's why I would say you should google it but I would Google like basically the idea of a problem hypothesis and how you and they they have basically customer problem and solution hypothesis and so I would just I would just be very specific about what customer has the problem in your hypothesis and then it becomes very

40:36clear as to what customer segment you should focus on so it all has to do with your hypothesis would be that answer okay all right we have time for two more questions

40:53hi Hayden you mentioned you talked earlier about charging early and I realize like a lot of us today are building SAS products you know monthly recurring revenue but what's your thoughts on charging early for an enterprise type application like a downloadable web app that's targeted more towards the enterprise yeah believe it or not it might be even more important with enterprise to charge early the reason is enterprise generally has money you're usually walking into their office or something like that or having multiple conversations with them so I would I would get really fast to like if it's early I might just say can can we do a three month paid pilot were

41:36you actually paying me because what I've noticed in my experience is that when you go to an enterprise and you don't charge them for something the it's very hard to get conversations with them follow-ups with them and figure out what the what the pain really is that they have but when they start paying for something it becomes a little more real even even generally that's true but I think in enterprise I would charge way earlier if you could and that's also a way to signal whether they even give a about kind of what you want to sort of do for them last question doesn't even have to be about

42:07his talk just anything he's ever spoken about ever hi it's more on the I guess on the focus and sequence when you're at such an early stage where you know collecting data almost seems useless because you're you've probably got a handful of people who are using it so it's more you know how I guess any talk about you know how do you decide what to focus on we're at such an early stage that you're trying to kind of decide what the pain is I guess yeah I don't I don't really go heavy on the quantitative metrics early on in terms of when I'm starting because I think

42:40it's much more about talking to people and understanding the pain and so quantitative I mean if a lot of your engineers so maybe you care about you know being data-driven or data oriented early on for me like I I'm a product guy like I'd rather figure out like what what problem do they have is it painful enough is it do I hit a nerve when I talked to like the tenth customer still have I found a pattern in the conversations and even if you have people signing up for your service generally don't have much traffic you're not really trying to scale a customer acquisition or any of that so measuring

43:14a lot of that stuff might not be worth it especially if that product you're building doesn't matter and you end up ditching it and so I would put a lot more emphasis on all the sort of stuff I talked about around whatever your process is on finding Payne just pick a process try it and see what you really latch on to there's about five of them I described so just find the one that like most aligns with how you how you can do it fast and also effectively Thank You Hayden sweet - thank all of you [Applause] you