Episode 496 | "The Press Covers Exceptions, Don't Compare Yourself to Slack or Zoom"
May 12, 2020
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Colin Nederkoorn, co-founder of customer.io, is known for his unique approach to marketing automation, while his partner John brings expertise in analytics tools. They discuss their unconventional journey, starting with no savings and bootstrapping a SaaS app. Colin emphasizes the importance of balancing innovation with best practices and shares insights on building a remote team. The duo also highlights their commitment to supporting the bootstrapping startup community and reflect on early marketing strategies that helped them thrive.
Customer.io's founders utilized a hybrid funding approach, allowing them to maintain control and align business values with personal beliefs.
The pivot to a remote-first company enabled Customer.io to attract top talent, fostering a strong culture of flexibility and deep work despite inherent challenges.
Deep dives
The Unique Journey of Customer.io
Customer.io took a distinctive path in its development by intentionally avoiding both traditional venture funding and purely bootstrapping. Instead, the founders utilized a hybrid approach, raising initial funding from friends and family while focusing on creating a profitable business without the high-stakes pressures of seeking a unicorn status. This allowed them to maintain control over their company while still growing substantially, as evidenced by the acquisition of over 1,400 paying customers and achieving 11.5 million ARR. The company’s choice to embrace a model of independence has resonated within the bootstrapping community, offering lessons on aligning business values with personal beliefs.
Embracing Remote Work
The transition to a remote-first company was initially driven by necessity rather than a defined strategy, as the founders aimed to sidestep the high costs associated with hiring in competitive locations like New York City. They recognized that by being remote, they could attract top talent from diverse locations, allowing for a greater variety of engineering challenges without a geographic constraint. This decision fostered deep work and flexibility, which ultimately contributed to a more robust company culture. Despite challenges inherent to remote work, the founders' commitment to asynchronous communication and a focus on deep work has proven vital to their success.
Innovating Through Customer Engagement
Early on, Customer.io distinguished itself by using analytics data to influence customer behavior instead of merely reporting on it, filling a gap in the market for targeted email and messaging solutions. Engaging with potential customers through conversations on platforms like Twitter allowed the founders to gather invaluable insights while simultaneously building relationships within their prospective customer base. This proactive approach to customer engagement and feedback, coupled with content marketing strategies, laid the groundwork for their launch and ongoing traction by creating a community of interested and invested users. Their methodology reflected a strong understanding of customer needs, which became intrinsic to their value proposition.
Navigating Challenges and Learning Lessons
The founders faced significant challenges in their journey, with one notable crisis occurring in 2015 when a major database outage threatened the stability of Customer.io. This experience emphasized the importance of having robust technology infrastructure and contingency planning in place. By reaching out within the tech community for support, they managed to recover and migrate their data systems, turning a potentially devastating failure into a critical learning opportunity about resilience and adaptability. Such experiences have not only strengthened their business model but have also deepened their understanding of the intricate dynamics involved in running a startup in the tech industry.
This interview was recorded several months ago, but is still relevant despite the pandemic. Colin Nederkoorn, the co-founder of customer.io has taken a unique approach to building their company. Customer.io does marketing automation for the entire customer lifecycle. They have raised funding, but not traditional venture money, and they've run it more like a self-funded SaaS. Colin and his cofounder John left their jobs with no savings, and they set out to build an analytics tool. Their story is powerful because of their unconventional approach and ability to persevere through hard times.
The finer points of the episode:
4:05 - The customer.io founder journey
5:23 - Their approach to selecting investors
7:01 - Reflecting on how Colin and John bootstrapped a SaaS app after leaving their jobs with no savings
8:02 - Why they pivoted from an analytics company to selling marketing solutions
13:15 - Finding the balance between innovation vs following the best practices
18:37 - How customer.io became a remote company, and the advantages/disadvantages of building a remote team
22:05 - What customer.io is doing to support the bootstrapping startup community (and why they care about bootstrappers)
24:30 - Marketing approaches that customer.io used in the earlier days
31:55 - The highs and lows of building customer.io