By Geoff Roberts 12 min read
I read an article recently on ESPN after the Boston Celtics took a 2-0 lead in the NBA’s Eastern Conference Finals about LeBron James’ Cleveland Cavaliers and the organizational fatigue the Cavs are currently experiencing. The Cavs have recently made several deeps runs into the postseason, resulting in longer than normal seasons. Media scrutiny has been relentless. Players and coaches have come and gone. And off-court distractions have been plentiful as LeBron and Co chase a nearly impossible dream of trying win championship after championship in LeBron’s pursuit to match Michael Jordan’s 6 NBA championships.
The article got me thinking about a different sort of fatigue that I’ve been feeling in my own career and industry; the world of venture capital backed marketing technology start-ups. I’ve known that this feeling has been there for a while now, the embers smoldering, but more recently the feeling has really started to burn in earnest. I call this feeling marketing technology vendor fatigue.
Marketing fatigue has been written about before, but to me the issue is much deeper than the volume of marketing messages we must sift through or the plethora of technology decisions modern CMOs must make. I want to talk about false narratives, next to impossible growth goals, and the underlying root causes of this issue.
For me, marketing technology vendor fatigue is caused by being repeatedly bombarded by marketing technology vendors with messages and content telling me that I have it all wrong – there’s a new way to do marketing, the next-generation way, it’s going to transform everything, and I better get onboard!
In short, 99% of the time this is complete bullshit. To make matters worse, the world of VC backed marketing technology start-ups is relatively small and very much an echo chamber, resulting in marketers like myself being hit over the head with these largely false messages over, and over, and over. On Facebook. On LinkedIn. Via email. At conferences. And every… single… other… channel.
Ultimately I’m writing this article for a few reasons, which I’d like to state up front:
- First and foremost, I’ve found by talking to other marketers that I’m definitely not the only person that feels this way. Which provides an opportunity for martech companies to better understand their buyers and show a bit more self-awareness in their own marketing strategies.
- Second, there are very clear and logical reasons why this occurs. I’d like to inspect those.
- Most importantly, because this comes with an opportunity cost that is often at odds with what’s actually best for customers.
Let’s dive in.
Defining marketing technology vendor fatigue
First, let’s start with a definition.
marketing technology vendor fatigue - The feeling that results from being relentlessly bombarded by messages from marketing technology vendors telling you that their tools represent a new, transformative, or revolutionary way of doing marketing when their technology very clearly supports a time-tested fundamental of marketing or a pre-existing marketing channel. Most often repackaged ideas, concepts, or strategies; hype.
While that may sound harsh, for me, that’s the root cause of the issue. We live in this crazy tech enabled universe where for some reason it seems unacceptable to simply say, “Hey, we offer an email marketing tool. Or an analytics tool. Or a live chat tool. It’s rock solid. Our differentiator is teaching you to leverage this channel or tool better than anyone else.” That’s not very sexy, is it? But I’d argue that message is actually a really good thing.
And what if it’s the truth?
We’re leaving our values as consumers at home
Seriously, when was the last time you heard that message? There are companies out there doing this, but they seem to be the exception rather than the norm and they are certainly much more prevalent with technology products outside of martech. Basecamp is a company that comes immediately to mind. Wistia, another.
I yearn for a world where more martech vendors are OK saying “This is what we do, we do it really, really well, and ultimately our technology is an enabler rather than a marketing strategy in and of itself. Let’s teach you the fundamental marketing strategies our technology supports; or how to make the most out of the marketing channel our tool supports; that’s how you’re going to crush it!”
That would be refreshing.
There’s a strange phenomenon at play here, too. To borrow a tech stereotype (always dangerous, but one that I’ve found to be true), many tech start-ups are filled with employees that are regular consumers of craft beer or craft coffee (I’m guilty as charged). Heck, many of these companies even have exotic craft beer or coffee on tap within their own office kitchens. Given the choice of drinking a Heady Topper or a Heineken, the Heady Topper is chosen. A Guatemalan slow drip coffee from the local corner coffee shop versus a large black from Dunkins? You know who wins here.
Another such example where this phenomenon is on display is the music industry. Music buffs celebrate “underground” or “indie” bands, yet when their favorite artists or bands achieve the acclaim or success that their talent warrants they are often shunned as “having gone mainstream” or “selling out.”
The point here is most of the companies guilty of causing marketing technology vendor fatigue are filled with employees who as consumers, value companies and products who purposely stay small, who keep it real, who are more than happy to do their thing and do it really well without the need “transform” or “next-gen” anything. Without the need to become the next Starbucks.
Yet when it comes to their professional careers, they’re all too quick to jump on the bandwagon. To chase building that unicorn. To become a cog in the hype-wheel. To focus on growth at all costs.
Why is that?
Root causes of marketing technology vendor fatigue
The reasons why marketing technology vendor fatigue exists are not terribly difficult to uncover, but they don’t seem to be discussed all that often. I’ve boiled it down to three primary culprits.
First, competition. It’s well documented that there are over 6,000 marketing technology vendors out there, and that estimate is probably conservative. With so many companies vying for the attention of marketers, it makes logical sense that you need to either make a lot of noise, consistently, or say something different than all the other vendors in order to stand out. Or both. Next thing know you have carefully crafted and spun messages suffocating you from all angles.
Just this past week, during the course of my “normal” online life I was touched or interacted with 41 times by a single marketing technology vendor. 41!
Have they delivered their message? No doubt. Have they done it with consistency? Sure have. But if that’s what we’re calling “good” marketing these days… that’s just not something I want to be a part of. We can do better.
The second culprit I personally sympathize with more, because it has to do with time tested sales fundamentals. In order to sell effectively, you need to develop pain in the eyes of the buyer. Only once pain has been developed, realized, and the buyer feels urgency to act to relieve that pain are you able to introduce your company’s solution as the antidote to that pain. I view this very much as a truth, but even with that being the case I’m certain that you can alleviate your potential customer’s pain without needing to “transform” their approach or corral them into joining your “movement.” If you have a better solution for me, if you can improve my efficiency or process, just say so and I’m all ears.
An example of this can be found in Andy Raskin’s article The Greatest Sales Deck I’ve Ever Seen. Andy helps venture-backed start-ups tell their stories and craft their messages, and he’s one of the best in the biz at it. I’ve personally learned a lot from his articles and I’m quite sure his work has generated fantastic results for his clients. But just pause to notice the language used in Andy’s framework - he suggests that you name thy enemy, that you frame your customers’ problems as monsters, and position your product’s features or capabilities as magic gifts capable of slaying those monsters.
I get it, and I even believe the framework to be effective. But with 6,000 martech vendors all slaying monsters at once, how can the end consumer not feel exhausted? How can I not be lost in a dizzying spell of marketing technology vendor fatigue?
The third culprit is perhaps the biggest source of the issue; the vast majority of the companies that have caused my marketing technology vendor fatigue are heavily backed by venture capital. Don’t get me wrong, there is absolutely nothing wrong with raising VC money; it can represent a completely appropriate accelerant of growth or in some cases, a necessary means of building your company.
But with very few exceptions when you do raise VC money, you forfeit the right to build your company completely on your own terms. As Kim-Mai Cutler, Partner at Initialized Capital recently put in her article the The Unicorn Hunters, venture capital represents “Rocket fuel with strings attached…. When a company accepts venture funding, it commits itself to steep expectations for future growth.” When you raise VC money, you are more often than not committing to (trying to) build a Starbucks.
Rand Fishkin’s new book Lost and Founder breaks down this commitment and the often-neglected flaws of the VC model pretty clearly. VC’s are betting on beating the public markets, which extrapolated over a 10-year period means that VC firms need to earn roughly 3x their initial fund size over 10 years just to beat the public markets.
Take the example of a VC who raises a $100mm fund and invests $30mm into your martech company. Assuming your company is the lucky one, the 1 in 10 investment that turns out to be the (successful) fund’s home run, you need to take that $30mm and turn it into $300mm in the next 10 years.
Needless to say, that’s damn hard to do. Next thing you know you’re “creating” categories and flooding the market with your message at every turn. Your chasing growth at all costs, and I’d argue your increasingly creating marketing technology vendor fatigue amongst your buyers.
So what’s the solution?
The marketing technology Eden that I envision
The truth of the matter is spinning your marketing technology product as something new, something majorly transformative and disruptive, and flooding the market with your message at every opportunity can be massively, massively effective. It can build brand awareness, it can position your product in the eyes of your buyers, and it can generate enormous returns for your company and investors. There is absolutely nothing intrinsically wrong with this approach.
That said, if there’s a shift that I see it’s that consumers of these products – particularly more experienced buyers with the power to make buying decisions – are increasingly seeing through the hype and choosing to transact with companies that share the values that they hold as a consumer (a good thing!). They want companies that are authentic, that will keep it real with them, that share their values. So let’s call bullshit on ourselves, at least a little, can’t we? Let’s at least tone down the hype machine and instead reinvest our time and efforts into the things that matter more to our customers.
On a positive note, I think that we’re already starting to see some momentum in positive directions. What I’ll call SaaS 1.0 companies underinvested in what’s come to be known as “Customer Success;” SaaS 2.0 companies have started to double down in this area and are realizing the benefits of doing so. My hope is that SaaS 3.0 martech companies tone down the hype, and instead invest additional time and effort into:
Better, more personal self-service experiences.
Look no further than Amazon’s world domination and the countless statistics highlighting the extent to which consumers prefer the ability to self serve. B2B marketing technology software companies have a long way to go on this front.
No matter how great the self-service you provide is, at some point prospects and customers will want to talk to a real human being. And it’s really, really damn simple what consumers want when this occurs – they want a prompt response, from someone who knows what they heck they’re talking about.
The best email marketing tool in the world serves little value if the person replying to the email isn’t knowledgeable enough to craft a high value response or takes a week to reply. The best live chat tool in the world is worthless if it’s not staffed with a knowledgeable person on the other end who is able to provide an immediate and thoughtful response. It’s almost never the tool that’s providing that fantastic customer experience or delivering the fantastic growth marketing technology vendors want you to believe it will; it’s the people leveraging that tool.
So invest more in your people and less in your hype! If you sell SEO software, hire more experienced SEO consultants. Send your staff to a SEO bootcamp. Whatever it takes.
Besides reallocating some of your companies energies in these directions, you can also be part of the solution as a consumer. Whatever your marketing technology need, one thing that’s for certain is there’s no shortage of high quality tools out there to fulfill that need. Actively seek out the companies that are doing things on their own terms, that will keep it real with you, that have invested their time in their people and in you as a customer. Revel in discovering the awesome products that exist that no one else knows about, and when you find them, share them with those that are close to you.
We revel in doing this with coffee, with beer, with AirBnBs as opposed to Marriots. Why not do this with software, too?
It’s not surprising given the competition and prevalence of the “Silicon Valley mindset” in the marketing technology space that the issues outlined in this post exist, and that a growing number of marketers are feeling marketing technology vendor fatigue.
And if you think about it, it makes sense that this space is filled with people with a knack for creating carefully spun messages that represent little more than hype. If you look back 50 or even 20 years that’s to a large extent what marketing was. Those were our roots, and the progress we’ve made by stepping away from that past and embracing data driven marketing has now earned marketers a seat at the strategy table.
A very good thing.
But I’m of the belief that we can still do better, that we can be more real, and that we can actually still achieve better business results by focusing less on “slaying monsters” and more on providing better customer experiences while continuing to reallocate our budgets towards processes and people that make customers more successful. Even if that results in diminished reach, for SaaS companies I think a more direct path to revenue growth is the increased customer loyalty and customer lifetime value we could realize if we turned down the bullshit, just a bit.
Can you relate?
By Geoff Roberts 8 min read
At Outseta almost all of our customers are early stage SaaS start-ups; in many cases just a single Founder or a small group of Co-founders. Every single one of these companies knows they “should be doing SEO,” but between building your product, incorporating your business, testing other marketing channels, and hustling to make some early sales SEO too often gets pushed by the wayside.
That’s too bad, because the sooner you start taking SEO seriously the sooner your business will realize the the benefits of sustainable organic traffic. Even if you’re investing heavily in SEO, this often takes 12-18 months.
With this very challenge in mind, I decided to ask three leading SEO experts about two of the biggest SEO related challenges I see early stage SaaS start-ups face; both of which I'm wrestling with at Outseta.
Let’s meet our experts.
Neil Patel, Co-founder of Kissmetrics, Crazy Egg, and Neil Patel Digital
Let’s do it.
Question #1 - Link building with limited resources
Geoff Roberts: We are an early stage, bootstrapped SaaS business. I am the Co-founder responsible for go-to-market strategy; I own all of our marketing efforts as well as sales. Link building is a very time consuming task, so I’ve basically chosen not to spend time deliberately building links and am instead focusing on content quality and occasional guests posts on other sites. I feel like I should be spending more time specifically on link building, but it’s such a time-suck and I have other competing priorities (sales for one!). What’s your advice for other bootstrapped start-ups when it comes to link building - how much time is “enough,” and how would you recommend they tackle link building in a more deliberate, cost effective way?
Miguel Salcido: Well, it's never ‘enough’ time. Link building needs to be an ongoing effort, like any marketing channel. You will need to prioritize.
Focus more on content for third-party sites like LinkedIn, B2B blogs, and Medium which seems to be a great place for start-ups. Because at this point, your product is fairly unknown and very niche. You need to get the word out and build brand. So put most of your energy here to start out. Use ghostwriters if necessary to save time. Once you’ve established the brand and traffic to your site, you can shift the focus to more content for your own site.
Make sure that you have at least 2-3 very high quality guides or content pieces that you can use to drive people to, making sure to have a lead magnet (tools/checklist/calculator/etc.) that you can offer with each piece of content so you can capture emails.
For your content, try to focus on use cases for your software if possible. And interviewing SaaS startups is also a good route.
Create “teasers” for every piece of content you have and post those out through your social channels, focusing on LinkedIn. Schedule these to post regularly. The teaser should entice readers to “click here to see the full article” in order to get them to your site. Schedule all of this using Buffer + Quuu.
Neil Patel: I would follow the tips in this video. And as for time, I would spend at least 5 hours a week building links. After a year you can slow down.
Marty Martin: Link building is a hateful, extremely time consuming, onerous task, and not one that many people have a real knack for. Being successful in link building is all about your creativity, process, and breaking it out into manageable tasks. Otherwise, it can take an unending amount of time.
Link building at scale, as a siloed task, can be broken out roughly into the following steps that can be run in parallel, saving you time and frustration:
- Content Creation
- Placement Negotiation
This is typically the realm of agencies, and not something a bootstrapped startup can pull off on its own.
But don’t despair! As a startup, there are other options to consider. If you’re getting a lot of press because you’re amazing, ask for the links. One option is to use a tool like Ahrefs’ Alerts. It will notify you of any mentions of your brand name, where the citation is not linking to you. Then simply email the journalist or website editor, thank them for the mention, and ask for the link back to your home page so their readers can find you. That’s an easy, manageable, once a week type activity that will earn you links over time.
Another option, is using Ahrefs (as mentioned above), or another tool such as Majestic that will show you your competitors’ broken links. A small amount of checking and you may find a resource your client used to have that now 404s, and that’s an opportunity for you. Build the same resource, download the list of broken URLs, use an intern or other internal resource to find contact info for all of those websites, and write to them to tell them their users are missing out as the site they’re linking to no longer has the resource in question, but your site does. Ask for them to update their broken link to your website. This is a task that can be broken out into a process as described above, and tackle a bunch of links at once. We’ve found broken resources with thousands of link opportunities this way.
Does your college or university have an online magazine and/or alumni magazine? Pitch them to write about your recent advancements as an entrepreneur. Do you have business partners and other principals? They should pitch their schools as well!
Build a useful asset, driven by data, that can be a useful resource to journalists or other websites. For example, the government has tons of freely available, regularly updated datasets you can use to build a data driven piece of content on your website. We have used data from the Census Bureau, US Patent & Trademark Office, and other resources to build amazing pieces of content for our clients. They attract links naturally, and with a little outreach effort, you can draw in additional links.
Having the right tool helps as well. We use a tool called Pitchbox to manage our outreach and follow ups. It makes the outreach and response process a breeze.
Question #2 - Keyword selection in established, competitive categories
Geoff Roberts: At Outseta we offer a platform that integrates CRM, subscription billing, email marketing, help desk and knowledge base, and reporting tools. “CRM,” “Email marketing,” and “Subscription billing” are insanely competitive keywords - to the extent that I feel like it’s not even worth us really targeting them. Also, we sell a platform solution that isn’t nicely categorized as “marketing automation,” for example. As a result, I haven’t been very deliberate in selecting keywords to date; our SEO strategy has instead primarily been…
- The “normal” build your first few links stuff that start-ups do - building social media profiles, an Angellist profile, some start-up directories, reviews sites, etc.
- Creating very high quality, long form content - the idea being if the content is good enough, it will naturally build backlinks.
- Guest posts on other topically relevant blogs.
What’s your take on this approach? How would you recommend start-ups in established, competitive categories get more deliberate with keyword selection given these challenges?
Miguel Salcido: You are a hyper-niche B2B SaaS startup. There are no keywords to describe everything you do. So you will have to focus on the solutions your platform provides, and yes those are super competitive terms. I’d also focus on “startup” related terms (startup tools, SaaS startup tools, etc).
If you can find a similar company and see what they target, using SEMrush, then that’s a good idea for keyword research.
Your approach so far is solid, just make sure the content is in fact really high quality and you do that by measuring engagement, email signups, links, and sharing. If you’re not getting those things, then your content is not resonating.
Neil Patel: I wouldn’t worry about keywords. Just blog about content that is super highly relevant (to your audience) and you will start to rank for terms. Next, place banners and links within blog content to landing pages to drive signups.
Finally, go into Google search console and see what pages get the most traffic. Look at the list of keywords that you are getting impressions for and then sprinkle in the keywords you haven’t mentioned on your site yet. The key isn’t to just add keywords, but it is to also expand the content.
Marty Martin: If you are starting a new niche or opportunity with your SaaS product, why not come up with a catchy industry name (think how Rand Fishkin of SparkToro and Dharmesh Shah of Hubspot coined the phrase "Inbound Marketing"), and start using that name in all of your marketing. Eventually, when people start searching for that phrase, you’ll already be the dominate player. Now, this isn’t an easy thing to do, but if it catches on, you’ll be set.
I think your approach above is time tested and can pay dividends with time, but most startups don’t have the luxury to wait for good content to become seasoned and linked to. Good, long form content can draw links over time, but it is a very slow process without outreach.
One thing that may get you more awareness is to build integrations for Zapier, IFTTT and similar services. I’ve become aware of many amazing tools just by browsing their integrations.
Thank you to Miguel, Neil, and Marty for weighing in on these questions. For any SaaS start-up that’s resource constrained, I hope this provides some clarity on your approach to link building. And for any start-up competing in an established and extremely competitive category, hopefully the advice this group shared will help identify the keyword targeting strategy that will yield the most meaningful results for your business.
By Geoff Roberts 3 min read
This is the first company update we’ve published in 2018, so let’s start with the big picture; we’ve delivered our minimum viable product, have started charging our users, and are continuing to develop the platform based on user feedback. Here’s a closer look at what’s new.
Our team is growing
We’re excited to announce that James Lavine has joined our team as a designer. James started working with us in January and is already responsible for the brand refresh that you see on our website and in our software. James is now earning sweat equity in Outseta commensurate with his contributions. We feel that with Dimitris and Dave on development, James on design, and myself focused on our go-to-market efforts we have the team we need to get Outseta to the next level. Welcome, James!
Redesigned knowledge base
One example of James’ work is our newly designed knowledge base. The new design features larger, easy to read text as well as an easy means of navigating between categories. The design is also particularly well optimized for mobile devices, making important product documentation available wherever you are.
New Feature! Sales pipeline management
We had initially scoped SaaS metrics and reporting functionality into our minimum viable product, but we decided to punt on this feature temporarily and instead build functionality to help SaaS start-ups manage their sales pipeline. We made this decision primarily because of our own need for sales pipeline management tools; we figured if we needed this functionality prior to reporting capabilities most other early stage SaaS start-ups would as well.
The drag-and-drop interface allows you to set up as many pipelines as you like, while easily adding columns to your pipelines that can be customized to mirror the stages of your customer acquisition process. As deals progress you can move cards through the various stages of your pipeline, making it easy to keep track of where each potential customer is in your customer acquisition funnel.
New Feature! Engagement index
Last but not least, we added a widget to our dashboard to help you measure your customers’ engagement with your software. If you are using Outseta’s subscription management widget for product registration and authentication, you can now easily see the aggregate and unique number of people who have logged into your software each day. By selecting the “Data View” you can see exactly who is signing into your product and when they logged in.
This has been really useful to us from a sales and customer support perspective, as it enables us to proactively reach out to users and offer help when we know they are actively engaged with our product.
At the end of Q1 our team got together in Boston to do a retrospective on Q1 and discuss our goals for Q2. Here's what we'll be focused on.
- Improve the customer onboarding experience.
- Implement a customer success program for early customers. This includes weekly meetings where we ask for product feedback, then help customers with their businesses however we can. We're looking for 100% customer retention.
- Improve sales pipeline management tools; help sales reps spend their time in the right areas with better lead scoring, lead management, and engagement metrics.
- Develop a Wordpress plugin to make it easier to capture website form data and send it to Outseta CRM and email lists. Our users often start by syncing newsletter sign-up, beta registration, or “request early access” forms with Outseta.
That's all for now.
-Dave, Dimitris, Geoff, & James
By Geoff Roberts 5 min read
As I’ve been engaging with SaaS start-ups across industries this year, one thing has become certain; real estate tech is hot in 2018. The real estate tech start-ups listed below range from companies that are still developing their products to venture-backed businesses that have already found significant traction and revenue. Here’s our hand-curated list of real estate tech start-ups set to make waves in 2018.
Approved - Approved is a San Diego based SaaS company that’s building a platform to modernize mortgage lending. Led by two former Redfin employees, the company recently raised $1mm in funding and is an EvoNexus portfolio company. The platform automates the collection of loan documents and also features instant loan approvals.
eLandlord - eLandlord is a Boston based company developing a mobile platform to help landlords and homeowners save time and money in repairs, while also taking a more proactive approach to preventative maintenance. “We’re allowing property owners to outsource the painful parts of property maintenance to us so they can spend more time with their family,” says Charles Hadsell, Founder and CEO. eLandlord offers an alternative to property management through a usage-based model and a hand-picked network of service professionals and partners.
Team: Founder & CEO Charles Hadsell
dwel.co - dwel.co is a New Jersey based online property management platform built for both landlords and tenants. The company’s solution is specifically focused on streamlining the accounting and financial aspects of the landlord-tenant relationship. “dwel.co is dedicated to providing real estate investors with the tools they need to manage their business, their way” says Joe DiNardi-Mack, Co-Founder of dwel.co. The founding team met at Rutgers.
IDX Boost - IDX Boost offers advanced MLS search tools, as well as user analytics and marketing automation tools. “We’re making powerful online marketing tools simple and affordable for realtors,” says Josh Stein, Co-Founder of IDX Boost. The company’s “ready-to-launch” real estate websites and Wordpress IDX plugin have already helped hundreds of agents make beautiful WordPress sites, track their users, and automate their outreach.
coUrbanize - coUrbanize is a Boston based company that provides an online community outreach platform for real estate developers and municipalities. The platform allows you to post updates and host online conversations with the community so projects progress faster. “coUrbanize uses technology to give every community member a voice instead of having to attend inconvenient meetings while enabling developers to gather, package, and submit feedback into public record ahead of meetings,” says Chief Operating Officer Alo Mukerji.
Off Market Leads - Off Market Leads is a platform that allows New England real estate investors to find, market to, and close off-market deals. The platform allows you to search off-market leads and create direct mail lists with data on ownership, taxes, mortgages, liens, pre-foreclosures, sales, and more. Off Market Leads is the official real estate investment partner of The Warren Group, the most comprehensive and accurate source of information on real estate in New England.
Team: Founder Tyler Cubell
Apt. App - Apt. App is a Denver based mobile platform that seeks to improve the resident experience in multi-family properties. The app’s features focus primarily on fostering communication and building community; an example of this is the ability to safely and anonymously notify other residents of a common disturbance such as a noise complaint.
New York Equity Group - NYEG is a real estate investment, development, and technology company operating in the northeastern United States. The company’s real estate investment software is designed to help anyone assess a real estate investment opportunity in 5 minutes. The product is scheduled to become publicly available in Q2 of 2018.
Team: Founder Philip Michael
Enviar - Enviar offers real estate landing pages designed to generate leads for your properties. The company is currently in beta but already has traction in the form of 200 customers who have published more than 3000 landing pages.
Team: Stealth mode
Localyfe - Localyfe provides customized property recommendations to buyers and renters using proprietary algorithms, experiential data, locational analytics and user data, while delivering tools and data to market professionals. CEO Brian McAllister previously served as Senior Vice President of Corporate Development at CBRE, the largest commercial real estate services and investment firm in the world.
If you are a real estate investor, a home buyer, or a resident the 12 companies listed above are primed to make your next real estate dealing that much less painful. Whether you're looking to invest, buy, or move-in, these companies may soon become... household... names.
Who is missing from this list? Feel free to mention other real estate tech start-ups worth watching in 2018 via a comment below.
By Geoff Roberts 10 min read
In recent years much has been written about the "death of email marketing," the basic premise being that everyone's inboxes are more inundated with emails than ever before. Spammers are a problem and response rates are on the decline as we all get better at ignoring the noise in our inboxes.
Email prospecting is a blunt instrument, they say. At best it's a spray and pray game where you blast a sizable list of targets and pray for a 20% open rate and a 2% response rate.
The day I sat down to write this post I stumbled across the following Linkedin update from Larry Kim, Founder and former CEO of Wordstream. Larry has Founded and acted as CEO of successful tech companies, has been a mentor in Techstars, and is the type of guy with a Twitter following of 35,000+. I must admit it put a smile on my face to see him openly vouching for sending cold emails.
I would even argue that with all the lousy emails people are receiving, there's never been a better time to stand out from the crowd with a well designed email prospecting strategy. This article will outline step-by-step the approach that I've been using at Outseta to achieve a 40% response rate on prospecting emails. My hope is some of these tactics will help you in your prospecting efforts, too.
A "cold" email list does not equal a low quality list
When I say that I've been sending emails to a "cold" list, what I mean is that not a single person that I've emailed knows me or anything about Outseta. What that does not mean is that I'm emailing a low quality list - if you are sending emails to undeliverable email addresses, or have out-of-date contact information, that's on you.
Step 1: Find a data source that contains information on target companies
The first step in successful email prospecting is finding a data source that contains information on target companies. At Outseta, we sell to early stage SaaS companies so sites like Founder Dating, Gust, AngelList, and Product Hunt are a great place to find target companies. AngelList and Product Hunt even let you sort specifically to find SaaS businesses, then filter by "Joined" or "Created Date" making it easy to find newly added leads.
There's 13,357 potential leads for me right there on AngelList alone!
If you sell to colleges, an example of a data source could be the Princeton Review. If you are looking to sell your product to yoga studios in San Diego, you can simply Google "San Diego yoga studio" and begin building your list of targets that way.
I recommend building a list of at least 50 target companies to start.
Step 2: Find relevant contacts at your target companies
Now that you have a a list of target companies, you need to find the right person to reach out to at each of your targets. Here are a few tricks that I recommend.
About Us pages
Lots of companies today have "About Us" pages on their website. This often acts essentially as a directory of company employees. Here's an example from our own website.
Look up the target company on Linkedin
By looking up your target company on Linkedin, you'll find what is essentially a company directory of Linkedin member profiles. Simply search for the name of the company, then click the link that says "See all employees on Linkedin."
Google Search "Company name, title"
In this example, I searched for "Mailchimp CEO."
One of these three tactics usually does the trick. Now you should have a nice list of target companies and specific people at those companies that you'd like to reach out to. Which brings us to...
Step 3: Find email addresses for your targets
The best way to get started with finding email addresses is simply looking the person up online. Check their Twitter profile. Maybe they have a "Contact" page on a personal website, or an About.me page that contains contact info. If you visit the person's Linkedin profile, you'll find it says "Contact and Personal Info" in the right hand side bar. By clicking "Show more" you'll expand this section, and oftentimes find contact information readily available.
If none of the above tactics work, your next best option is searching for the email address of anyone else at your target company. Most companies use a consistent structure for their email addresses - something like email@example.com or firstname.lastname@example.org. If you can figure out what email structure the business uses, you can then use a tool called Hunter.io to guess at what the person's email address might be, and verify if you are correct or not. In this example, I verified that geoff(at)outseta.com is in fact a valid email address.
If you can't find a valid email address for someone on your target list, remove them from your list and move on. Again, your success will depend on the quality of your list!
And a final note; when you first start this process, you should build your own list. It's your responsibility - nobody else is going to assemble the list with as much care as you will. Once you've proven this process and that it can generate results, you can absolutely train someone else to do this for you... but you should do it to start.
Crafting prospecting emails that get responses
Now that you've assembled a high quality email list, it's time to craft your approach.
Step 4: Your subject line needs to be something your recipient cares about
This sounds obvious, but it happens all the time; prospecting emails are sent with a subject line that the sender, not the recipient, cares about. "Sign up for Product XYZ" or "Can we connect for 15 minutes"...
The recipient has never heard of product XYZ, or you for that matter, so why would they want to connect?
Much has been written about email subject lines - yes you should avoid words like "Free" or "Sale" to avoid spam filters - so I'll just leave it at you need to mention something that the recipient genuinely cares about, that peaks their interest in a non-gimmicky way.
In the case of the prospecting emails I've been sending, I came up with a very simple solution - make the email subject line the name of the company that I am emailing. Nothing more than "Subject: Start-up Name."
This sounds simplistic, but in this case it works - start-up companies are by definition unknown. They have little-to-no brand awareness, and are starved for attention. It makes sense that when you email a start-up Founder with the name of their company in the subject line, they get excited - "Someone knows about us!" and they open the email.
Step 5: Personalize your approach
This is probably the single most important step in this process, and it's the one that everybody skimps on. I like to start all of my prospecting emails with...
My name is Geoff Roberts, I'm a Co-founder of Outseta."
After that brief introduction, I immediately make some sort of personalized comment about their business. Everybody has been on the other end of generic email blasts, and it's immediately obvious when you receive an email like that. So take five minutes to learn about the prospect you are emailing and try to add value to them in some way. Consider...
- Asking them a clarifying question about their product or service - show genuine interest in them.
- Providing a tip that might be useful to them based on your past experience.
- Drawing parallels between their business and your own.
- Offering to help them in some capacity.
The number of ways you can go about doing this are endless, but you need to do your research first. Check out their website, look at content they've shared, and look at their social media interactions. If you can't genuinely add value or personalize your approach in some other meaningful way, take them off of your list. Here are a few examples from emails I've sent.
This was a company that provides real estate websites to real estate investors.
"I stumbled across (Company Name) on AngelList when I was researching SaaS companies in the real estate industry. I was previously head of marketing at Buildium, a property management software company so I've spent a lot of time thinking about how to market websites and software tools to an audience of real estate investors."
This email got a response and we ended up talking both about Outseta and about how the start-up could best market their business.
Another company I emailed was building a network for start-up Founders to share their objectives and drive accountability.
"I came across (Company Name) on Angellist and I love the concept of providing collaborative workspaces in order to set objectives and drive accountability. One of our idea validation interviews at Outseta was conducted with a very similar company called OpenCompany, which has since rebranded and pivoted a bit to become Carrot.io."
Again, I likely got a response because I was familiar with a company that was tackling a very similar problem. The recipient checked them out, was curious about why they pivoted, and I was able to peak his interest because I shared something very relevant to him.
Ultimately, I had a strong hunch that the personal approach I was using in my prospecting emails was one of the primary drivers of the strong response rate that I was seeing. I decided to test this hypothesis - the results were pretty astounding.
Personalized Approach: 117 emails sent, 48 responses, 41% response rate.
Traditional Email Blast: 437 emails sent, 7 responses, 1.6% response rate.
That's right - I saw a 39.4% increase in response rate when I took the time to personalize my email approach. Same quality list. Same call to action. The only difference was I led with a personalized comment based on researching the recipient's business, rather than sharing a more generic comment with a larger audience.
Two or three sentences of personalization is enough, but it's an absolute must.
Step 6: Clearly and succinctly articulate your value proposition
Now that the recipient knows that they aren't on the end of an email blast and that I've actually taken the time to understand their business and engage with them in a meaningful way, it's time to tell them what I have to offer and why it's important to them. Again, 1-2 sentences should suffice - get to the point! Usually I go with something like...
"Anyways, at Outseta we've built a platform that offers fully integrated CRM, subscription billing, customer communication, and reporting tools. This allows SaaS start-ups to launch "leaner" with less technical overhead."
Step 7: Ask for permission to send them additional content or information
I will admit, this is a practice that I was initially skeptical of - start-up Founders tend to be insanely busy people, so why wouldn't I just send them information right away? Do they really want me to send them another email?
Turns out, this works really well. I end each of my prospecting emails with...
"Would it be OK if I sent along more information on our approach?"
This works for a few reasons:
- I've already grabbed their attention with a personalized approach.
- I've clearly (and quickly) mentioned what I'm offering and why it matters to them.
- I'm building some credibility and trust by not jamming marketing materials down their throat that they didn't ask for.
- My goal with this initial prospecting email is simply to get a response from the person - any response! If the person responds I know that they are alive, that they read my message, and the door is open to engage with them further.
By ending the email with an open ended question, recipients that are interested in what I'm offering will usually reply with a "Sure, send some info over." Those that aren't interested tend to send along a polite "No thank you," which is equally valuable and let's you know that you should spend your time elsewhere.
Here are the actual responses from the examples I shared earlier.
Step 8: Consider the timing of your emails
Don't get hung up trying to find the mythical perfect time to send prospecting emails, but do use some common sense and whatever information you have at your disposal.
At Outseta, I've found good triggers to be when companies launch their product on Product Hunt or publish their company profile on AngelList. These indicate early stage businesses that are just getting a product to market or are embarking on their start-up journey, and that's the time that we'd ideally like to intercept our prospects.
If you were selling a product to colleges, chances are it's best not to send prospecting emails on graduation day. You get the idea.
Last but not least, a little experimentation is a good idea. I saw particularly strong response rates during the "dead" week between Christmas and New Years, when start-up Founders had more time than usual to unbury themselves from their email inboxes.
Yes, this is a time intensive process and it's easy to make excuses as to why your email prospecting efforts aren't working. But for bootstrapped start-up this is a strategy that costs nothing, that can yield significant results.
Start small. Send 10 emails that are absolutely the best emails you can craft.
I think the responses you get will surprise you.
By Geoff Roberts 6 min read
In the past few months I've been involved with launching a number of SaaS products on Product Hunt, a community where early adopters discover the latest new technology products. Product Hunt is the best site of its kind, followed by Betalist; both sites represent a unique opportunity for early stage start-ups to gather product feedback and land their first users.
There are plenty of "How To Launch On Product Hunt" guides already out there, and I've devoured most of them at this point. My first piece of advice is to take it straight from the horse's mouth - Product Hunt has published two guides on the topic themselves.
The reason for this post is twofold; first, the best way to launch on Product Hunt has changed pretty dramatically, so a lot of the content that's already out there is outdated. Second, I'll give an honest assessment of my own experience in terms of what worked for us and what didn't.
Let's do it.
Is Product Hunt's Ship product worth it?
Product Hunt's Ship product is a suite of tools designed to help you gather product feedback and build an audience prior to officially launching your product on Product Hunt. I will admit that I was at first skeptical about Ship, but I decided to pony up the $79 per month to give the product a whirl. I realized a few benefits from using Ship.
Ship allows you to schedule your launch on Product Hunt. Honestly this is mostly a convenience thing, but it's a nice perk of using Ship. Without Ship, you need to fill out all of information required to launch a product in real-time per se; what this means in practice is that it's been the norm for people to wake up at ungodly hours to launch their product, maximize the amount of time they have to accumulate upvotes, and get something of a first-mover advantage.
This is definitely helpful in terms of planning your launch; you can set expectations with your internal team in terms of exactly when your product will launch, and you can easily schedule other promotional activities to work in tandem with your selected launch time. This was also helpful to me because it allowed me to reach out to the Product Hunt team in advance and let them know exactly when we were planning to launch (more on why I did this shortly).
Ship represents a massive opportunity for influencer marketing and virality. In all honesty, there used to be a pretty fool proof way to all but guarantee a successful launch on Product Hunt if you could just pull it off; getting an influencer with a large following to "hunt" your product. I'm talking a Jason Lemkin or a Hiten Shah type. In the past if you were able to recruit an influencer with a large following to hunt your product on launch day, it would automatically notify all of their followers via email that they had hunted your product driving a ton of traffic and upvotes to your page.
This tactic doesn't work anymore... unless you use Ship. So if you have a personal connection to a major industry influencer, or have someone like that on your board, or can simply convince an influencer to subscribe to your product then you can still reap this benefit. This is a pretty smart monetization strategy by the team over at PH.
How this works today is if you are using Ship, you are allowed to build an "Upcoming Product" page that Product Hunt will also help promote. Get your influencer to subscribe to your upcoming project page, and all of their connections will be automatically notified. Bingo, you've tapped into the virality benefit that PH used to offer. If you know someone with a significant following on Product Hunt, Ship is absolutely worth the $79 per month.
Ship allows you to directly communicate with people interested in your product prior to launch. Ship captures contact information for anyone who subscribes to your upcoming page and allows you to email them directly. The number of people who subscribe to your upcoming page is a decent barometer for how much interest there will be in your product, but on top of that this is useful in terms of gathering feedback on your product prior to launch and communicating updates to your subscribers to keep them in the know as your launch day approaches.
Tips for launch day
The mechanics of writing a good Product Hunt listing are covered well elsewhere; tips for writing solid taglines, adding relevant images, a descriptive GIF, etc. What follows are additional promotional tactics that proved valuable.
Email "Upcoming" page subscribers. If you did take advantage of Ship, PH gives you the tools to directly email all of your upcoming page subscribers. This is a no-brainer, as these people have already expressed interest in what you are working on. On launch day take the time to send every subscriber a personalized email letting them know about your product launch and asking them to upvote your product. I think you'll find that just about everyone will oblige; this represents low hanging fruit.
Email else anyone who has expressed interest in your product. At Outseta we are pretty protective of the audience that we've built. While lots of "how to launch on Product Hunt" guides suggests blasting every email contact and social channel that you have at your disposal on launch day, I think this is overkill and can lead to lots of people being hit with duplicate, poorly targeted messages.
As with any marketing campaign, you need to consider your audience. You might sell to an industry that is altogether unfamiliar with Product Hunt; if that's the case, you're going to get little value emailing that audience about your PH launch.
If you have contacts that you feel are likely to be Product Hunt users, by all means notify them of your launch. Beyond that I'd advocate for only reaching out to contacts that have expressed legitimate interest in your product in some way, perhaps as beta users. In this case even if the contacts aren't PH users, they may be invested enough in your idea to create a PH account in order to upvote your idea.
Product Hunt allows new users to login with existing Twitter, Facebook, or Linkedin accounts. They must then complete some configuration settings around their name and title, as well as the types of products they are most interested in. This is a pretty easy process, but spell it out in your email approach so that you recipients know exactly what your ask is of them and how they can go about delivering on your ask.
Tweet at Product Hunt. Tweet a link directly to your listing @ProductHunt. Don't include any other hashtags. It's in PH's best interest to also share particularly well designed and launched products.
Share a relevant "collection" of related products. Product Hunt allows you to assemble "collections" of related products. Prior to your launch, take some time to build a collection of products that are relevant and useful to your own product's potential users. For example, when we launched Outseta I compiled a collection entitled "The Day One SaaS Start-up." Every product in the collection is relevant to our audience and complimentary to our own product.
Once you've assembled your collection, reach out to Niv Dror who is in charge of community at Product Hunt (Niv@producthunt.com or @Nivo0o0 on Twitter). This is a good way to get your collection in front of the team at PH, in hopes that they will help promote the collection that you've assembled.
Product Hunt is just one channel to get the word out about your SaaS start-up, but it's an inexpensive one that can serve as a serious catalyst for finding your product's initial users. Follow the guidance outlined in this post and you'll have a better chance of making your Product Hunt launch as impactful as possible.
By Geoff Roberts 10 min read
When you say “Blockchain” or “Ethereum” to people who live their lives outside the spheres of tech or highly speculative investments, you often get confused or simply apathetic reactions, to which I say… understandable. But the applications of blockchain technology are in fact vast, highly useful, and go way beyond whether or not you’ve chosen to invest in Bitcoin.
We’ve been writing for more than a year now about our desire to build a self managed, non-hierarchical business. One that is absent of bosses, where work is both more rewarding and meritocratic. Allow me to introduce you to Jack du Rose, CEO and Co-founder of Colony.
Colony is building a platform on which to build open organizations. The rules of the organization are enforced by blockchain technology rather than paper based contracts, allowing anyone to contribute to the organization and earn payment or ownership commensurate with their contributions to the “colony.” Workers earn “reputation” and influence based on merit.
We caught up with Jack because we are interested in a future where work sucks less, where no one feels like nothing more than a cog working in a company where disproportionate rewards are reaped by few. It’s an ambitious undertaking, and Colony isn’t the only company focused on solving this problem - make no mistake about it, there will be an entire generation of SaaS start-ups embracing this model before you know it.
Geoff Roberts: Hi, Jack. Good to have you. Why don’t you start by giving us the elevator pitch regarding what you are working on at Colony?
Jack du Rose: Colony is a platform for open organizations. By open organizations I mean what some people might call decentralized organizations; essentially it means that we’re creating software that enables people all over the world to work together and complete projects or start companies together without needing to know or trust each other. So it's a platform and a protocol that provides a software based framework so that the organization runs based on a set of immutable smart contracts rather than on the basis of legal agreements and paperwork.
Geoff Roberts: So if you are talking to someone who doesn't understand what blockchain is... why should it matter to them that the rules of the organization don't live on paper contracts but instead live in blockchain? Why should people care?
Jack du Rose: People should care about this thing because it’s powered by software. Let's forget about Ethereum for now. If a company’s operates based on paperwork there has to be somebody who is managing that paperwork, somebody who is looking after the fact that that paperwork is being done. You're trusting that there are people who are competently adhering to the rules, but also that they are honestly adhering to the rules. You can't really trust that unless you've got the laws of a nation to back up and ensure that there will be consequences to anybody who is either negligent or malfeasant.
The nice thing about doing it on Ethereum is that you don't need a national legal system to enforce the rules of the organization. You can create smart contracts that lock up value or that have inherent consequences for misbehavior if you go against the rules.
Now if that's a centralized piece of software it's difficult to trust that you can predicate the existence of your company on that piece of software. For example, if Colony was a centralized piece of software we could get ourselves sold to Linkedin. Linkedin could then say "Oh we're going to shut this down actually," so for all the people who started your company, tough, it's gone. You probably just get that little email saying, "Hey, great news we've been acquired! We're joining this company and oh and at the end of the month we're going to stop providing our service.” So that's one important thing that need not happen.
Finally, smart contract based applications are sort of truly in the cloud. With decentralized applications, you'll always be able to use them. Once Colony is live on mainnet, even if the whole Colony team gets run over by a bus, you’ll still be able to use Colony. So that's really important if you're considering this kind of software as the infrastructure for an organization. You'd be incredibly foolish to predicate your business, your livelihood, all of your employees and stakeholders on some company that could run out of money or get acquired at any point.
Geoff Roberts: Talk to me about the product itself... is a Colony akin to a specific project or akin to a specific company? How do you think about the notion of a colony?
Jack du Rose: A Colony could be a company. I generally think there's some sort of quickening point when a project becomes a company. I'm not exactly sure what that looks like but I would say that almost every Colony starts out as a project.
Geoff Roberts: Got it. And with this notion of a Colony being open and fluid, where anyone can contribute to a Colony, is there still a notion that you're being hired to a specific Colony or is there a process to invite someone to your Colony?
Jack du Rose: Yes. We don't necessarily think that the only use of Colony will be this sort of really utopian vision of fluid organizations where it's completely leaderless. I think that there will be a bunch of different organizational types. Some will be more socially centralized, some will be completely socially decentralized. By that I mean that there's various trusted people within some organizations. I think that's likely to be the case.
I think some people want to be able to use Colony for, you know, they've got their centralized team, their core team if you like, and then they have a bunch of external contractors that they want to be able to work with. So I think it will be a broad spectrum of different organizational types. As it stands today everybody needs to be invited to join a Colony. I don't think it's going to be right for all if not most organizations to be just completely open. Many will want to be invite only.
Geoff Roberts: I know this is a very broad question but as you think about real life scenarios that Colony is going to have a hard time supporting what sort of things immediately come to mind?
Jack du Rose: I can't see Colony being used to run a veterinary surgery. Or a bakery. You know, there's all types of companies that run just fine as they are and they necessarily need to be collocated. It doesn't add a huge amount to be able to coordinate yourself, or have this kind of egalitarian way of working. I also have some doubts as to whether any very, very large organizations are likely to embrace sort of new organizational paradigms, just as we don't generally see those kind of organizations embracing things like holacracy. It's just very, very hard for them to do so. They're very interested in different organizational models, but it's not something that springs to mind as something which is going to be an easy change.
Geoff Roberts: Sure. So a key idea here is that people working on a colony are paid or earn ownership in a company in line with their contributions to the colony. In order to facilitate that there's a systematic peer review of work completed. Can you talk to me about that? How has this process worked with your beta testers or just how you envision that peer review process working?
Jack du Rose: A peer review would be understandable to mean that when you do piece of work it gets put out to a whole bunch of people and those people approve it in some way. That's not how it works at all in Colony, actually. There are three roles within a piece of work. We consider the smallest piece of work to be a task. But there are three roles within a task. There's the manager of the task - that's the person who defines it, who sets the budget for it. You've got the worker, the person who does the work for the task obviously. Then you have the evaluator, whose role is to make sure the task has been adequately completed and rates it.
Sometimes all three roles can be played by the same person - people are incentivized to check what everybody else has done because if they find something that they disagree with they are incentivised to raise a dispute over it. Someone raising a dispute can put down a stake to claim some action taken by another is inappropriate. The person against whom the dispute has been raised may then either back down, or match the stake deposited by the objector. Only then will a vote be called to arbitrate the dispute, and the winning side will receive a share of the losing side’s stake. So essentially the peer review is implicit by virtue of the fact that people are incentivized to police activity in their Colony.
Geoff Roberts: Talk me through the idea of the reputation system and how that is leveraged.
Jack du Rose: Within a colony we have tokens and reputation. Whenever you do a piece of work you earn tokens for doing that work and you also earn reputation as a function of the number of tokens that you earn for doing the task and how well the evaluator thinks you did it.
The reputation that you have is important because it informs the amount of influence you have when a vote is necessary or when you're requesting funding for a task. The more reputation you have, the more of the funding of the Colony you can direct. Also from the perspective of your earning ability within a Colony, the more reputation that you have and the more tokens that you have, the larger the proportion of the revenue of the Colony that's going to be yours to claim.
Geoff Roberts: OK. And what does that reputation score actually look like? Is it a number 1 through 10, or 3 out of 4 stars?
Jack du Rose: It's an unbounded number associated with two different values within a Colony. For every task that you do you simultaneously earn reputation in these two different attributes. One is the skill that you used, and the other is the context in which you used it. So that would be the departments or projects that you worked within.
Geoff Roberts: How do you see company direction or strategy created, maintained, and reinforced over time for companies built on Colony? When a project kicks off it has some sort of strategy and mission. And then you can work from that for months or years depending how broad that is but at some point that needs to be revisited. How have you envisioned that working?
Jack du Rose: I think that a common misconception about organizations that will be completely decentralized is that they will be leaderless, that there will be nobody who is providing vision, who is providing the direction. I think that that's not proved to be true at all. I think even in the most decentralized projects, Bitcoin for instance, there are leaders who emerge and people rally to a flag. I think this will be no different whatsoever.
I think with strategy - that's also a job, that's also something that needs some people to do that work. It's not just sort of an emergent consequence of an organization. It's usually the C-level people within an organization who are the people who create that strategy. In this case those C-level people, rather than being canonized as they currently are, will instead emerge as a consequence of the quality of their actions and the fact that people want to follow them.
Geoff Roberts: Fair enough. Sounds good.
Jack du Rose: Good stuff, it's been great to talk to you guys.
By Geoff Roberts 5 min read
An operating agreement is a key document used by LLC companies to govern internal operations. It basically lays out for the business owners how financial and functional decisions within the business will be made.
This past month Dave, Dimitris, and myself got together in Boston hash out the details of the operating agreement that we’ll use going forward. This post serves to break down the key decisions that we made in layman’s terms, so future employees understand how Outseta will operate moving forward. Our hope is that other start-ups can also benefit from seeing where we ended up, and maybe borrow some ideas as they consider their own operating agreement.
Here are the key details of Outseta’s operating agreement.
Who works at Outseta? How will decisions be made?
There are two different classifications for people working at Outseta - employees and members.
- Anyone working at Outseta that is not a contractor is an employee. Well, duh.
- All employees that have been with the company for more than 1 year will participate in our profit sharing program.
- Members are employees who have an ownership stake in the company and are eligible to vote on the following decisions. A 66% majority is needed for an item voted on by members to be approved.
- Dissolving or selling the company
- Amending our operating agreement
- Issuing more membership units (think of these like stock options)
- Removing “managers” (more on this momentarily)
- Every 4 years members will vote for “managers” who will serve a 4 year term.
- Dave, Dimitris, and myself are Outseta’s existing managers.
- All other management decisions (but not those listed above) related to the business will be made by the managers.
- If there are 2 managers, decisions need to be unanimous to be approved. If there are 3 managers, there needs to be a majority vote for decisions to be approved.
Delivering financial rewards
When Outseta makes money, we think our employees should make money. Aside from salary there are two other ways to line your pockets when the business does well; profit sharing and membership units.
Profit sharing program
- 50% of the Outseta’s profits will be distributed to employees who have been with the company for more than 1 year.
- The extent to which you participate in the profit sharing program will be based on how many years you’ve worked at Outseta. The longer you work at Outseta, the larger your portion of the profit pie.
- Because Outseta is a LLC we offer “membership units” as opposed to traditional stock options or equity grants. This essentially represents an ownership stake in the business - if Outseta is sold, acquired, or in some other way liquidated all members working at Outseta will receive a payout based on the number of membership units that they hold (just as you would with traditional stock options). Initially membership units will be granted at the managers' discretion, but we’ll look to formalize a more scripted means of issuing units to ensure fairness going forward.
- If a member leaves the company they do not retain any ownership or equity in the business. Instead, we offer a buy back program where Outseta will buy back membership units from departing members. Members who have left will receive a payout based on the number of membership units they held and how much the company is worth. The valuation of the company will be calculated as two times last year’s revenues. For example, if last year’s revenues were $5mm and a member had membership units that represented a 1% stake in the business, our buy back program would pay them ($10mm X 1%) = $100,000. We will periodically review this formula to make sure it’s fair. The buyback will happen over the course of a few years based on the financial reserves of the business.
In short, we think that the profit sharing program incentivizes all sorts of good behaviors amongst employees - it encourages commitment to the company and financial discipline, while also giving all employees who have been with Outseta for more than a year the opportunity to participate in the financial successes on the business. And if members do wish to leave Outseta to pursue other opportunities, it also allows them cash out their membership units at a fair rate.
Why do we exist? How do we behave?
It’s unusual to see information around durable items like company purpose and values in an operating agreement. We thought it would be useful to include this information in ours because we hope to leverage our operating agreement as an asset that can help prospective hires understand the opportunity at Outseta, how the business will be run, and how decisions will be made.
Why do we exist?
- To help small companies simplify the technology choices they have to make to run their businesses
- To create a profitable company we are proud of and is enjoyable to work for
How do we behave?
- We look to invest in, develop, and fill open roles with employees/members first
- We optimize for the best people possible by embracing remote versus co-located work
- We value flexibility, but we honor our commitments to each other
- We think long term over short term and care more about the journey than the destination
- We embrace self management, encouraging autonomy and empowering our people to make decisions openly and transparently without managerial oversight
- We earn influence by consistently demonstrating great work and decision making
What do you think? We’d love any and all feedback on the agreement we’ve come up with. You can also view the full version (the actual legal document) of the operating agreement here.
-Dave, Dimitris, and Geoff
By Geoff Roberts 7 min read
You may have noticed that while we’ve kept a steady drumbeat of SaaS related content flowing, it’s been four months since we published our last Outseta company update. Long story short, we’ve been head down working on some of the most challenging aspects of building our product. We didn’t have enough to say that we felt was worthy of your inbox, but we’re back - here’s what we’ve been working on…
For the very first time, our product is publicly available - you can create a free account on our website and check out the product for yourself. Yes, we have some apprehension about this but as Reid Hoffman, the Founder of Linkedin famously said, “If you’re not embarrassed by first version of your product, you’ve launched too late.” The onboarding experience is still pretty rough, but the product functionality is there.
Outseta & Techstars
We’re excited to announce that we’re the newest member of Techstars' Perks Program. Techstars is one of the biggest accelerator programs in the world, currently operating accelerators in over 17 cities worldwide. Techstars has accepted over 1000 companies into its programs to date, with those companies currently having a market cap of over $8.1B.
Any Techstars company can now find Outseta in Techstars Connect, a private resource which portfolio companies are given access to. We're offering a free year of Outseta to any Techstars company that signs up by the end of June 2018.
Subscription management widget
A huge part of our value prop hinges on reducing the amount of time SaaS start-ups spend managing the technology infrastructure that their businesses depend on. This is important because it gives start-ups more time to focus on building their product and business, while extending their runway.
With that in mind, we built a feature we’re calling our subscription management widget. While this may not sound sexy at first blush, we believe this will come to be a real differentiating feature for Outseta because it’s not functionality we’ve seen built in competitive products.
So what is it?
This is useful because if a SaaS business has a subscription model that Outseta supports, companies can simply “drop-in” this functionality in minutes without needing to build this “scaffolding” logic that all SaaS companies need, yet is logic that doesn’t differentiate them in any way. This work represents busy work, not get-your-product-to-market work.
An additional advantage worth mentioning is that because this information syncs with Outseta’s CRM records, we can easily add a simple engagement index based on login activity to each person or account record in Outseta. This is a simple but effective proxy/indicator for product usage and engagement which we’ll make available to our customers in a subsequent release.
There are other services that will handle authentication for you (Auth0, Okta), and there are services that handle subscription management. However, we came up empty when searching for a service that offers a drop-in solution to automatically give your website this functionality in a matter of minutes.
We’re building our billing system
In order for us to charge our own customers - but more importantly, to enable our customers to charge their customers - we’ve been hard at work building our subscription billing system. We’ve made a couple of important decisions here:
- We’ve partnered with Forte payment systems to process credit card and ACH payments. We have a pre-existing relationship with Forte, as they are also the payment processing partner of Buildium. Working with Forte allows us to offer the lowest possible payment processing fees (cheaper than Stripe!). The application process Forte offers our customers is also very straightforward, and will allow our customers to go live with their payment processing system in as little as a day or two. Here’s what the application looks like.
- At some point in the future, we will also offer our customers the ability to process payments via Stripe. We’ll be offering this option primarily to support international customers.
Our billing system will be complete and we expect to start charging our own customers beginning January 1, 2018.
We changed our pricing model
The last company update that we published was focused 100% on the process we used to develop our initial pricing strategy. While we put a lot of thought into our initial pricing, as we thought further about our pricing model over the summer we came to the conclusion that we didn’t quite get things right the first time around.
Initially we proposed a blended pricing model, with our pricing tied to both number of contacts (as most e-mail marketing tools are) and number of users (as is the norm for most CRM and help desk tools). We liked the idea of tying our pricing to the number of users of our software because it seemed fair - as a start-up grew and needed to give more people access to our software, what they would pay us would scale in conjunction with their own company’s growth.
We did voice a mild concern with this - we know that we’re going to be selling into a target market (start-ups) where the majority of our customers will fail and in turn, churn. As a result, we need to plan for this churn and figure out how to make our product as “sticky” as possible so that we do retain our successful customers and extend their lifetime value to our business as much as possible.
By charging on a per user basis, we would be actively discouraging companies from getting as many of their employees as possible into our software. The more people who are accessing and using our software, the “stickier” the product ultimately becomes. Said another way, getting as many users as possible into our software benefits us more at this stage than monetizing each and every user.
We think our initial pricing was too focused on capturing revenue as our customers grew or from larger customers, when in reality for the first couple of years we’re primarily going to be successful working with companies with only a handful of employees.
As a result, we’ve made the following updates to our pricing.
- We’re still offering a free plan, but it’s limited to your first 250 contacts. This is not a time bound trial, and it’s not a limited feature set offering. You can access and use all aspects of the product for as long as you like, but once you’re really ready to go and need to service 250+ contacts you’ll need to pay.
- Once you move to a paid plan, you’ll pay us $99 per month or $999 annually. This hugely simplifies our pricing and makes it so start-ups will know exactly what their bill will be. No surprises at all, and we think $99/month is a fantastic deal for your CRM, email marketing, customer service, billing, and reporting software.
- We’re offering all customers unlimited users, unlimited contacts, and unlimited emails. This is hugely disruptive as we think about winning business away from other companies in existing categories like email marketing, CRM, and help desk software where pricing is typically tied to number of users or contacts.
We think this pricing is aggressive and will allow us to compete and win deals. We are more interested in growing our user base than maximizing revenue potential. Shout out to Randy Parker, Founder of Constant Contact and Brevi, for sending us a note sharing this concern and giving us a gentle nudge in this direction. We appreciate ya.
By Geoff Roberts 20 min read
As the SaaS business model has matured over the course of the past decade, it's fair to say that awareness of the importance of the customer success function has escalated dramatically. Any SaaS business' success is intrinsically intertwined with the success of its customers - and if you think about it, this is a good thing. It creates alignment as an imperative.
Enter Aaron Fulkerson, CEO of MindTouch.
I was fortunate enough to be introduced to Aaron a few years ago now, just as MindTouch was beginning to hit its stride. MindTouch offers "customer self-service software" to customers including Optimizely, Zuora, Wal-Mart, Accenture, Whirlpool, Zenefits, and Intuit, to name a few. In early 2016 the company raised a $12mm Series A led by PeakSpan Capital to accelerate growth, largely on the back on fantastic customer success oriented metrics. These metrics included negative gross revenue churn - a measure that speaks to a company's ability to grow revenue from existing accounts at a faster rate than revenue is lost from cancellations.
Needless to say, as I was beginning to think about how we can build customer success into the DNA of Outseta from day one, I immediately thought of Aaron.
If you're interested in listening to the audio version of this interview, here's what you'll find...
First 10 minutes - Aaron shares how he and his Co-founder failed to find a suitable self-service product to disseminate research to internal staff when they were working together at Microsoft. He then details the journey that MindTouch took from being an extremely popular open source offering to making a somewhat terrifying pivot to a traditional SaaS business model.
10-25 minutes - Aaron shares how MindTouch now uses a customer success blueprint with each of their customers, which drives alignment not only throughout the sales and onboarding process but also across departments and with relevant executive sponsors. But simply having a customer success plan is not enough - you'll also learn how to hold your customers accountable to the agreed upon plan.
25-31 minutes - Aaron offers his advice on how SaaS start-ups should be thinking about customer success from the get-go, and what they can do to build a customer success oriented culture.
If the audio version of the interview isn't right for you, a slightly trimmed down transcription of the interview is available below.
Geoff Roberts: Hi everybody. I'm Geoff Roberts Co-founder of Outseta and I'm here today with my friend Aaron Fulkerson who is CEO and Co-founder of MindTouch. How's it going, Aaron?
Aaron Fulkerson: I'm doing terrific.
Geoff: Fantastic. Why don't you start by telling us who you are and what you're working on at MindTouch.
Aaron: Well like you said I'm the CEO of MindTouch and I'm also one of the two Founders and my responsibilities, they've evolved over the years from being everything from operational to tactical, running different departments, to now I feel like I'm actually CEOing. What's involved with that is I focus on the development of strategic partnerships, helping the market understand how our technology is disruptive for businesses. And of course being the principal person for communicating internally with our team. But it's around finding strategy, communicating the outward facing vision to the market, the partners, the analysts, the journalists, and then internally making sure that there is a steady drumbeat that keeps people focused.
Geoff: At this point MindTouch has had quite a bit of success and operates in the customer success and customer experience space.
Aaron: I like to think of it as what we do is customer self-service and that impacts success, support, and other business but it's really focused on the idea that 80 percent of the population wants to self-serve when they have a support question or when they're onboarding; they don't want to talk to somebody. I know that I don't want to. Turns out 80 percent of the world doesn't want to either. So that's what we're solving for; self-service.
Geoff: Makes sense. What can you tell me about the success that the company has had today in terms of customer count, revenue, and those sorts of things?
Aaron: Well we have about 350 customers. I don't know the exact count but it's approaching 400 customers and our customers will range from a lot of the software unicorn's from Domo, Zenefits, Zuora, Sprinklr, and Docker to more mature companies like Whirlpool and Electrolux that are in the consumer goods space all the way to the largest travel conglomerate on the planet which is TUI. It's really across the board the kinds of companies that we service but it's all very specifically focused on helping their customers self serve.
Geoff: OK. So today I want to talk about early stage startups and what they can do to build a customer success oriented culture and customer success into the DNA of their business from the get-go. I know MindTouch took a bit of a long path to get to where you are today. Can you talk me through the evolution of the company up to this point?
Aaron: The technology began as an open source project that my Co-founder Steve and I started to solve for a specific problem that we'd experienced when we were doing research at Microsoft in distributed systems. We were frustrated that we didn't have a means of disseminating our research out to the rest of the product teams in a way that was effective. So what it meant was that we spent a lot of time talking to people, giving presentations and we thought that there had to be a better way to disseminate our research.
I was the Program Manager of a 14 person team. My responsibility was to take these brilliant minds' research and package it in a way to get it to the product teams. So I went around to the different product teams. This was in 2003 or 2004, and we were spending $2B dollars a year in research which is nothing by today's standards but it was for the most that was being spent at that time. I thought surely somewhere at Microsoft somebody is developing a technology that's going to be useful for what we were trying to achieve, which was self-service. I went to the Sharepoint team and they were not working on this. I went to the Office team - same thing. I went to a bunch of different internal research incubation teams and there was nobody trying to solve this problem of how do you deliver an effective self-service experience.
So that's when we decided we should do this. We came up with the idea of doing it and then we said well let's do it as an open source project. That's where we started with this idea of how do you deliver self-service. We released it as an open source project and it became wildly popular within a year. It was a top 10 open source project and before we knew it we were getting thousands of downloads a day. That was around 2008, and that's when we started selling a commercial license.
Geoff: So the open source model very much validated the concept for MindTouch, and you knew you were working on something worthwhile. Talk to me about making the transition from the open source product to a traditional SaaS offering.
Aaron: It became clear that we were trying to address a market where the use cases were so broad and vast. We didn't have an addressable market that we strategically decided to attack. So we found herself in this position where we were like "what are we trying to do?" We're trying to compete with SharePoint and Dropbox and Box. It was at that point we were just like you know we've got a ton of distribution. In 2008 we did $1mm in cash receipts with an average deal size of $3000. In 2009, we did more than twice that - it was like $2.5mm. We were growing but we were clearly trying to address too big of a market. And all of us sudden we started to get all this competition in this category. So it was clear we didn't have that business model.
At that point we said look we don't have a business that we can scale because we're trying to be everything to everybody. So it was like, "OK why don't we divert our attention away from this broader use case and let's just focus on self-service," and it was Steve my Co-founder that was like "OK, well let's sharpen up the feature set and by the way we're going to do it in the cloud." I was initially really hesitant because when I started talking to our customers at the time they were mostly IT guys who had done installations for businesses. And for many of them their job, their sole purpose was to maintain that install. We were certainly at odds with the people who recommended us. I'm like Steve I don't know; I get that delivery in the cloud is faster and it's better for the customer. But at the same time I'm scared because all of our customers right now aren't there. So it was it was a scary proposition when we set out in 2010 to launch a cloud version, but we pulled it off.
Geoff: If you look back over the course of those 10 years and could shake your younger self and give yourself some advice on how the path forward could have been smoother, what would you tell your younger self?
Aaron: We were lucky that we actually turned what was a very popular project and a failing business into a successful business. If you look at what we did wrong, it's what I see so often when I talk to entrepreneurs - they have 10 businesses that they're trying to take to market instead of one. So they're trying to solve 10, 20 different problems instead of one. And there's no way you're going to do that; it's hard enough to solve one problem and build one business.
Geoff: So let's talk about MindTouch today. What does customer success look like within the company - where does it fit within the organization, and why?
Aaron: The idea that it is the success of the customer should be the central focus of the business. And that if everybody's economic incentives should be aligned. We have as part of the sales process this idea that we're going to develop a plan or a blueprint for customer success. So the customer success blueprint maps out the customer's objectives, their challenges. How we measure success. Who are the stakeholders. And this became something that helped me work deals, close business, and inform the customer success team after we close them so that they have a very sharp focus around launching the client. It also became something that informed the marketing team so that they could go back and develop case studies based on the impact that we had on the business. It also informs the product team so that they know which features to emphasize or de-emphasize. And of course as I said already it impacted our ability to close the business because it helped our sales efforts be very focused on the customer's needs and how they measure success.
So for us the idea of customer success back in 2010 became really the central aspect of our business that drove all our deal flow, all of our product development, and all of our marketing efforts by understanding this customer success blueprint that we put together for each client.
Geoff: What do these blueprints actually look like? Is it a Google doc? How do you actually distribute that plan amongst your team and amongst your clients?
Aaron: So this has become a thing in our industry now because a lot of our customers like Salesforce, like Gainsight - they've adopted the same model. Their CEOs and heads of sales have said "Hey straight up this is really effective, I'm going to use this model too."
In the beginning this just looks like a summary e-mail; you don't want to have a formalized document because then it makes it less likely that the prospect is going to actively participate in creating the document and you want them to actively participate - you want it in their words. So in the beginning it's really a series of summary emails after your conversations that say, "Hey I've updated what your objectives are. Your objectives are to improve the efficacy of your support team that's measured in cost and net promoter score. And and then our objective is to increase your renewal rates." Well how are we going to do it? So then it goes into challenges. What are your current challenges? Well our customers are upset because they don't know how to use the product or onboarding takes too long. So it really becomes this summary email that then later gets formalized into a document. Another key section is who are the stakeholders who are involved in the project? That's very important - who are you talking, who's measuring your performance, who needs to be involved to get the deal done. And what are the strategic objectives - if you're selling business software that's a considered purchase, there better be a strategic objective that ties into a board level issue. If it doesn't then you've got to hope that it's some kind of transactional software sale for a couple thousand dollars.
Geoff: Sure. So I would argue an entire generation SaaS companies, let's call them SaaS 1.0 companies, invested too late in customer success programs and churn caught up with their businesses. Then as SaaS 2.0 companies began to emerge you heard a lot more about customer success plans, onboarding programs, all those sorts of things. These of course are only effective if the client takes them seriously and commits to them. What sort of things are you doing at MindTouch to hold the client accountable to the plan or blueprint that you put together with them?
Aaron: That's a good question. I mean one thing I'll say is that when we started doing this our prospects thought it was a sales tool. And it took a lot of effort and literally years to help them understand that this is a tool that is useful to you whether you by MindTouch or not. This is something that frames up for their own internal team their team's thinking around a particular set of objectives and challenges.
So let me start now to answer your question - what techniques to use to hold them accountable. What we've done is map your success plan to a customer success program that ties in with a maturity model. Over the last five years we've collected all of the best practices and put it on like a continuum of effort and value for how do you deliver an effective self-service experience. That aligns with our customer success program; the maturity model you can use whether you buy MindTouch or not. It's just this industry best practices, it's unimpeachable. This is exactly what you should do in the kind of value you should get out of it, but we layer in our customer success program that's enabled by our software to drive them along this value continuum which is this maturity model. So by having a maturity model that ties back to value delivered for the company and having one that is technology agnostic is, I think, the best thing you can possibly do to help the company understand why they need to go through the series of steps.
Now you will always run into, periodically... what will invariably happen is that you have stakeholders at your client who don't give a crap. They're like, "Man, I just I want to collect my paycheck. You're making me do things and I don't want to do things. Leave me alone." And again it's by having a maturity model that ties back to very specific value, and having had that communicated to the executive team who are involved in the purchase before it got handed off to the team to operationalize you can hold them accountable.
There's things that you can do to hold them accountable because then you go back to the Vice President or C-level Executives and say, "Hey, you bought us for these reasons, we've got these plays and the guy won't follow through." So having that all sewn up with with look you've got your your customer success plan that maps to your success program that ties in with your maturity model those are the different pieces. I remember Joe Payne who, he's a great guy, he's the CEO at Code 42 but he was the CEO Eloqua too - Joe told me that at certain stages he had like these, I forget what he called it, but like a nuclear e-mail. If the stakeholder who was operationalizing Eloqua didn't follow through with their commitments, it would automatically send to their boss. It was a way of holding them accountable to the different stages of the maturity cycle. So I thought that's another interesting one that that I don't know if we fully adopt it, but I I know I laid it out for the team. I don't know if we're actually doing it, but it's basically like hey when you have somebody who we think of as a Jar-Jar here which is somebody who's like a stakeholder but totally ineffective like Jar-Jar Binks, he's useless right? Who doesn't want to follow through the steps for whatever reason probably because they don't care. Then you have these nuclear options that send to their boss and their boss is already informed because the tools you used earlier.
Geoff: Understood, but you're kind of walking on a tightrope at that point though - you're trying to drive accountability, but at the same time you don't want to come off as, you know, tattling on somebody who isn't taking this plan seriously. That that must be a challenge.
Aaron: Sometimes it is. But I would rather us aggravate somebody than us be shelf-ware. You know when we enter into a commitment with a client we're SaaS, and some people think that second "S" is about hosting but it is not. It is about the expertise that our team brings to the table in an engagement. Because we are the experts on this; when it comes to customer engagement, when it comes to self-service, there's nobody on the planet that is more dialed in, more capable, more competent, more informed than MindTouch. And we take that very seriously - the technology is just an enabler of those best practices. It's the best practices where there is the value. It's the second "S."
Geoff: Sure. I would imagine when you bring on a new client you're going to hold their hand a little bit more at first during the onboarding process, you need to get them up and running with the software. What does outreach to that client look like going forward? How often are you checking in and who at MindTouch is actually having those conversations and doing those routine follow-ups?
Aaron: Well we have a customer success team and an accounts team and both of them are hyper focused on the success of the account. Meaning that there are certain milestones and a four stage process that we expect our customers to be moving along. The customer success team tends to take more of a proactive support approach around training and "Oh you've done these things now do these things." The account management team comes in and they're compensated based on upsells. But the only way to get the upsells is by moving them along a maturity model. So if we aren't delivering value they can't upsell. So everybody who interacts with the client post-sale is focused on moving them along the value continuum.
Now what are the check ins? We do a quarterly business review. But last time I was checking it was more frequent than that; it was like every four to six weeks there was a check in with the QBR and the QBR was about assessing where they were on that maturity model.
Geoff: Let's shift gears for a moment and talk about culture within an early stage SaaS company. One of the things that I've admired from afar when it comes to MindTouch is just the culture that you've built here within these walls. What would your advice be to other entrepreneurs, other founders who are looking to really create a culture where customer success is embedded in the DNA of the company from day one.
Aaron: Well, I think about it in terms of MindToucher success and a MindToucher could be somebody who's a client of ours or it could be somebody who's on our team and why that's important is that I think about anytime somebody works with us, it's our goal, this is Steve my Co-founder and I, it's our sincere desire and our goal that that person's career is accelerated. And that's true whether the MindToucher is a staff member or a client. That's our business. It's really about advancing the careers of all MindTouchers.
Now there's a very specific way we do that; it is for our clients moving them along the maturity model. For our staff it's about making sure that we're making the hire that puts them in a position where they have growth opportunities etc. Right. But I think that whether it's a SaaS business or any business if that's what your focus is, on the success of your version of the MindToucher, you know your team and your clients, then you're going to succeed as a company. And that's how you build a lasting culture, a lasting company. It's being hyper focused on that. When somebody leaves here I take it as a personal failure if they haven't moved on to a better position. If it's a lateral move or a step back I failed.
Geoff: Now that you're a more mature company, how have you sort of formalized all those sentiments that you just expressed. Have they made their way into your core values as a business, for example?
Aaron: Yes. So we have our core values that we're very vocal about. We go through a new MindToucher orientation. We walk them through it. They're embodied in samurai's sculptures on the walls, there at the beginning every one of our all hands presentations. Those are kind of the cultural pillars. And then the other thing that that we've been really focused on is our guiding principles. Number one is having a culture that attracts smart, good people who want to work hard doing great things. And the second is delivering to market a product that our customers love so much that they recommend us.
So we have our values, grit, integrity, beginner's mind, passion for process, and incremental improvements. Those are our core values that really guide everything that we do and those are the guiding principles that we keep going back to and reminding ourselves, "Hey look are we building a culture that attracts good people that want to work hard doing great things? Are we delivering a product that our customers love so much that they recommend us? So those are kind of the things that we really focus on around culture.
Geoff: Sure, so in tying it back to customer satisfaction, customer success - do you use things like NPS or CSAT scores here at MindTouch?
Aaron: So we use NPS. I don't know that we've got our NPS dialed in. When we're posting scores in the high 70s, I question is that a function of their last interaction with support? Or is that something more holistic across the entire engagement? Maybe it is. You go to G2Crowd or Trust Radius and we have really, really great reviews on there. So we do use NPS. The thing I caution about is that the way we capture tends to be at interaction points with humans. With MindTouch humans, so I always question like is our NPS score ridiculously high because of that? I just don't know.
Geoff: Fair enough. Lots of actionable, good tips there for other SaaS start-ups. Any final words for new founders starting a SaaS business as they think about their customer success plans?
Aaron: Well, we've covered customer success plans, we've covered having a maturity model... just make it up to begin with. You know we started with this just feels right and then we iterated, iterated, iterated, iterated over the last five years to now something that Accenture uses in their customer engagement plans, our maturity model.
One of the things that I think is really important for us Founders is I think that there's a lot of misconceptions about the importance of, "Oh, if I build a great product then I've got an opportunity in the market." Most of the people who come to me seeking investment or introductions to get investment, I look at what they're trying to do and my response is do you have $500mm? Oh you don't? OK. You have no chance of succeeding. The reality is that there is so much capital flooding the software market that the broader the market opportunity you're trying to address the less likely you're going to be successful. So focus on a very, very boring, boring niche. Focus on something really, really small that you can really crush because nobody else has noticed it and then expand from there.
That's the most important piece of advice that I find myself giving entrepreneurs who are starting companies; it's "Dude you are going after way too big of a market opportunity." Focus on something much much smaller that you can actually be successful in and grow from.
Geoff: Well thanks for the time and the tips Aaron, I very much appreciate it.
Aaron: My pleasure, Geoff. Always great to talk to you. Take care.