Product, Support and Adwords: the 3 keys to our early growth

In a couple of years, we’ve managed to build a pretty solid SaaS business out of a small Swedish coastal town. We’ll do $2.5m in revenue this year and have a little over 10,000 paying customers. We’ve never taken VC funding and done surprisingly little marketing. Even though we’re certainly not content with those numbers - we’ve learned a few things about building software businesses, so we’re happy to share our story so far.

In the last post, I spoke a lot about our culture and what success means to us - but we got a lot of feedback, mostly people wanting to know more about how we managed to hit 10,000 paying customers and how we grew our business in the early days.

Well, after spending some time over the holiday period thinking about the early days of Hemsida24 (our brand in Sweden) - I realised that, for us - there were 3 key elements to our growth - Product, Support and Adwords.

1. Product
OK - this one might be obvious, but of course to build a successful software company it’s convenient to have solid software! The reason our customers keep paying? Our software solves a problem for them.

**Listen to your customers
“Listen to your customers... but not too much”. That seems to be the most accepted advice for building products with customer feedback in mind. Much has been said/written about this topic - with the Henry Ford quote and the Steve Jobs philosophy being two of the most well known;

“It's really hard to design products by focus groups. A lot of times, people don't know what they want until you show it to them." - Steve Jobs

“If I had asked people what they wanted, they would have said faster horses." – Henry Ford

So, how can you effectively gather feedback from customers, but still maintain a vision that may be isolated from your customer feedback?

In the case of PagePicnic we absolutely spoke and listened closely to customers in the early days. During the first year, we frequently met local small businesses and talked about their website needs and their experiences with similar solutions. Those initial meetings were crucial - they literally helped to define the product roadmap and validate our assumptions about small business website creation. (Basically, they confirmed to us that Wordpress was just too damn hard.)

However, as we started to gather traction - we actually listened to customers less and less - our assumptions were validated, so there was less need to gather that feedback. That might come off as cocky, but it’s not about being cocky, it’s about focus. We knew the product was useful, and we knew customers were willing to pay for it - so it was more important to double down on what was working and try to scale the business.

As your company grows, you really need to listen to your customers for different reasons. Whilst in the early days customer feedback was all about features and product development - today we also gather feedback to create ambassadors, increase customer happiness, increase referrals and lower churn.

TL;DR: Listen to customers, but listen to them a little less as you gain traction.

**Keep an eye on the competition
When we launched Hemsida24 (again, the Swedish version of PagePicnic) in 2008 - we actually had no competition, but over time, we’ve seen a steady increase in Swedish competitors. We certainly don’t lose any sleep thinking about competitors (Groove wrote a fantastic piece on this topic), but of course it’s crucial to keep an eye on them, especially in the early days.

We now tend to look at competitors as “other ways of solving the same fundamental problem”, and generally in a market this big - there will be different requirements for different kinds of customers. The key takeaway - don’t panic! Keep doing what you’re doing. Of course you shouldn’t ignore your competitors - but remember it’s about being the best, not the first.

**Measure, measure, measure
If you’re not measuring, you can’t be sure of much. In a startup, with limited resources, it’s even more important. Whilst of course entrepreneurs were doing it before, Eric Ries really popularized the “Build-Measure-Learn” concept in his Lean Startup book, which I’m sure you’ve all read :)

I’ll be honest though, and admit that we were actually embarrassingly late to measuring stuff. Back then, we mainly looked at one metric - net revenue per month. Nowadays, we’re pretty into our Kissmetrics, and mainly stress over:

• Total Trial Signups
• Trial to Paid Conversion
• Churn
• Cost Per Acquisition (Adwords)
• Average Revenue Per Customer
• Customer Happiness / Experience with Support

2. Support
Support is definitely one of the things that our customers like about us. Because our product is aimed at small business owners with little to no tech experiences - support is obviously massive for us and I’d like to make a bet that we deal with more tickets than most similarly sized SaaS companies because of this.

Over the years, we’ve learned a few things about SaaS support:

**Work smart with support
The thing is, whilst you want to provide kickass support at all times - you of course want to keep the ticket numbers to a minimum. Here at PagePicnic, we're servicing over 10,000 customers with only 3 dedicated support staff. I'm not exactly sure about other companies, but I'd say that's pretty good for SaaS.

We spent a lot of time building our FAQ/Help Center and made sure that customers can generally solve a lot of their issues without needing to contact us. Video and Image guides are definitely something I'm happy we spent time on - it still benefits us today.

In addition, we've made an active decision not to provide phone support. This helps us keep the product low priced, and we can also redirect customer tickets to the right person (marketing, development etc) based on their issue. We could probably afford to offer phone support now, but we've decided to stick with what we have.

**Get everyone in the trenches
Very early we started a tradition that we still maintain to this day. Every single member of the team, from the CEO down, rotates through the support desk. In fact, right now as I’m writing this, my co-founder Mikael is helping a customer with a domain-related issue. By doing so, we make sure all team members understand how our customers think about and use our product, we keep the developers in the loop when it comes to user behaviour and it keeps us all humble. I couldn’t recommend this enough for SaaS startups - even a few hours a month will do.

**Invest in the right support software, or build your own!
We literally tried it all, ZenDesk, Desk.com - you name it, we tried it. Eventually, we just bit the bullet and built our own ticket/support system, and man, I’m glad we did. It’s intimately tied to our own application - meaning we save a crapload of time on tickets. When a customer files a ticket we can, with-a-click, check out their dashboard, check their logs and anything else that could help us solve the problem quicker.

Building your own solution won’t work for all teams - but in the long run, the time investment was well worth it.

3. Adwords
Adwords is killer for SaaS growth, it’s actually crazy that more companies aren’t using it to it’s full potential. The problem is, it can be pretty hard to get the model working. A lot of companies burn a lot of cash at first - and it leaves a sour taste in their mouths.
Back in 2008, we had very little competition on our keywords (“create your own website”, “small business websites” - in Swedish of course) - so our costs were pretty low. The key to getting Adwords to work though, aside from having a great product, is constant optimization.

It's worth noting that of course the best method for growth is customer referrals and word-of-mouth. If you can acquire and delight your customers using Adwords, a great product and kickass support - you shouldn't have a problem getting them to spread the word.


Summary
Well that’s it - smart product development, killer customer support and constant adwords optimization - those are my top 3 tips for early stage SaaS growth!

Good luck!

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Ludvig Granberg, CEO PagePicnic