Their software handles all sales information requests. Whether it’s requests for proposal, requests for information or security questionnaires for compliance or due diligence exercises, their platform gives salespeople the information and tools they need to let them do these exercises more quickly.
They have customers ranging from software companies like New Relic to large enterprises like KPMG and IBM.
I got a lot out of our discussion. In it, you’ll learn:
- How Zakir turned a problem he experienced in his work into a business opportunity.
- How they validated the opportunity and why a lightweight version of the product help speed up validation.
- How Loopio managed to sell to large organizations as a small bootstrapped startup.
- How Loopio got their first paying customer.
- How customer advocacy can help evaluate product-market fit.
- How they put the customer at the centre of everything and the impact it has on their business.
You can listen to the full interview below:
Etienne Garbugli (EG): How did your team go about selecting a product/market opportunity initially?
Zakir Hemraj (ZH): I think a lot of great entrepreneurial stories start with one of the founders experiencing the problem. That’s what happened with me.
I was working at an emerging software company called Achievers. I was there for 8 years working through various roles. I was the first sales engineer in the company. The entire sales team was leaning on me as the product expert. A lot of these exercises around responding to these types of sales requests (RFPs) would just come to me. I found it very cumbersome. There was no easy way to do it. It was a lot of Excel spreadsheets and Word documents. A lot of emails were being sent back and forth across the company, and there was no consistent way to do it well or even do it intelligently. How do you get more efficient and smarter over time, especially since you should be able to streamline these workflows? It just seemed like an opportunity.
Slowly, we decided to tackle the market. We bootstrapped the company to where we are today. But looking back to what got us to this day; we knew that if we were going to do this, we needed to solve a real problem. Especially since we’re going to grow the company based on revenue, we have to be solving a legitimate problem.
In the early days, just to test the market, there were a lot of customer interviews. A lot of talking with people in our own networks. The three of us had the luxury of being in our careers for about 10 years. We were leveraging our own networks and going out there, going to conferences and just talking to people to validate the problem and understand it more deeply.
EG: How did you go about validating the opportunity?
ZH: I think that really trying to get inside the head of the customer and asking questions about their pains and trying to map out what their current workflow is so that we can solve very specific problems. We took techniques from the Lean B2B book. We took techniques from the Mom Test book. We added our own flavour to it. But one thing that worked well was having a very lightweight version of the product to use as an anchor to the conversation. Without this, conversations can get abstract very quickly. Having something tangible to wrap those conversations around was actually pretty useful for us. It allowed us to iterate very quickly.
We sold ourselves as individuals, the value, the partnership, and the long-term vision. In the early days, the product was very minimal, so we got people to buy into the future. The biggest leap was getting someone to pay for it.
I remember the day that happened. We were running this beta for summer throughout 2014. We were trying to get whoever to come on board. Then eventually one day, I remember us sitting around the desks and we just said, “The next person who calls, just ask them to pay for it and see what happens.” Lo and behold, it happened.
EG: What were the core challenges faced by Loopio in the early days of the business?
ZH: In the early days as a bootstrapped company, not having a ton of funding behind us, prioritization of feature development was very difficult because there are all these things you want to do. There are customers that are starting to ramp up and giving you all this feedback. Learning how to say no was definitely a challenge. Pushing back and challenging our customers and prospects. I think in the early days we didn’t have that level of vocabulary. We had to develop that over time.
We’re selling to big organizations, and they have all of these demands, legal concerns, terms and contracts. We did not have a lot of that figured out when we started the company. We just had to figure it out on the fly, which is a great challenge to have. You’re forced to do things a bit more maturely because you’re trying to gain customers.
As much as we gained traction, we also got rejected a lot. At the end of the day, we’re a startup convincing a 1,000 or a 10,000 person organization: We might hear something like, “Hey, you’re an unfunded 3 person company. What guarantee can you give that you will be around next year if I invest in you?” There was just no way to guarantee that we would be around. So we built an executive portfolio to talk about all of our backgrounds. It was a deck that talked about our expertise in business and technology. That helped sell the future. Sometimes the only thing that can truly solve that problem is time. You have to be around for two or three years. It’s really a matter of waiting it out. Now, having 300 customers, it’s a lot easier. We don’t have that conversation as much.
EG: How did you know that Loopio had found product-market fit?
ZH: I think it was in your book you talked about 5 passionate customers. I don’t think there was ever a point in time where we said, “Yes, we achieved product-market fit,” but I do think it was around that mark.
One thing was very important to us – we knew we were building a product company, not a service company. If we had a bunch of passionate customers, and they were passionate about the services we were providing, then that would not have been an accurate representation of a product-market fit. The services were important but, the product was the main thing.
I also want to say that when we hit the 20-30 customer mark, we started seeing patterns in the customers. “Hey, these growth-stage software companies just get it.” Then we started to get our first set of online advocacy. Having people write reviews about you online and go to bat for you as a reference customer, that’s when you really start entering a territory where it’s not only you selling the product, it’s the community selling the product. Once you start making that transition, that’s a good product-market fit.
EG: What value did you get from reading Lean B2B?
ZH: We have built a whole company on this idea of customer centricity. We involve our customers in everything. We have a customer advisory council. We write very thorough and thoughtful release notes. We over-invested in our support team to make sure every user gets a phenomenal experience. Customer Success is something we invested in very, very early. The underlying philosophy of being close to your customers is important in B2B. Even if your product fails, great relationships will carry you through that. That philosophy really resonated with us in those early days. We built our company around that.
EG: Had you guys been exposed to this level of customer-centricity before starting Loopio?
ZH: I think so, but we’ve taken it to another level. Achievers was an employee engagement software. The engagement in the employee experience and customer experience we provided was ingrained in the culture of the organization. That led to engaging with your customers and prospects in a way that was above and beyond. I grew up in that philosophy in my first job out of school. I didn’t really know any other way.
We decided very early on, again as a bootstrapped company, that we might have the best product out of the gate but, what can we do right away that can differentiate us — the answer to that early on was Customer Success. I decided a year into the journey that I need to stop working on the product side and start spending the majority of my time on working with customers. This helped me make way better decisions for the business.
Loopio’s Customer Success Video
EG: After having been through it yourself, what validation process would you recommend to entrepreneurs starting in B2B?
ZH: The idea of doing thorough customer interviews is great. I also think it’s important when doing that process to time box it. Limit the number of interviews you’re doing to get your feedback. Have a methodology of how to conduct interviews and a framework. Have a strategy, and have a lightweight, minimal product to anchor conversations around.
Focusing on relationships very early is also important. Putting your early interviewees and early customers in a position of power. They’re the experts, and you’re just learning from them. I think that’s very important. The reality is a lot of people out there want to be helpful and give you feedback. They will help you in your business in the early days. More people than not will want to help you out.
Make it really easy for them. If you’re asking someone for their time, give them 3 suggestions of 15-minute slots. Don’t make them do the thinking. You should go out of your way to make it easy for them because you really want their time and their input. Little things like that will go a long way. Once you get someone on the phone, you can start a relationship, then prove value very quickly. If you get input from somebody, you can turn something around in 4 weeks to make it more tangible. Then they will be more excited to talk to you the next time and the next time. When the time is right, you can start asking for money. That was the way we approached it.
EG: What advice would you give to new entrepreneurs starting in B2B today?
ZH: Customers are everything. Know your customers. Know your market. Build relationships and iterate, iterate fast. It’s a combination of everything we talked about but, those are the things that come to mind.
EG: Thank you for your time.
ZH: Thank you very much.
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