How Typeform scaled to 150,000+ customers without losing focus

0:01This product already has 35, 38, 40 ,000 customers. If we want to innovate fast and not be hold with other things, security concerns, breaking something in the core product and so on and so forth, let's separate and do innovation with a group. And it was the best group to do innovation, was best profiles for absolutely exploratory work. Welcome to the SaaS Revolution Show, a podcast by SaaS.com. Here, we interview SaaS founders from around the world who've been there and done that. They share the ins and outs of how they built their businesses, their operations, their path for securing investment, and more.

0:44Our mission with the podcast is to help you, the founder, learn how to scale your SaaS, maintain your well-being, and navigate the complexities of this ever-changing industry. I'm your host, Alex Deema, and together, we'll explore the good, the bad, and the ugly in the journey to SaaS success.

1:28Hello, everyone. to entertain those. So maybe just to kind of get it started, one of the things I find amazing about Typeform is we're just talking 150 ,000 customers. I mean, it's astounding to think about. So talk to us a little bit about how you think about customers, given you have so many and what the implications of that are to the business. Yes. So it is my firm belief that we are here starting and building companies to solve the problem of a customer, of a concept, right? That's the main thing, right? And then the second thing here is hopefully there's many of them, right? So the market, the total addressable market is a very big one.

2:21I was fortunate to join Typeform. I'm the CEO. I'm not the founder. At the point where Typeform was already around 35, maybe 38 ,000 customers. Got it. When you joined. So 38 ,000 to 150. 150 ,000 plus. Yes. Yes. So the customer for me is the hero of our story. The customer is, you know, the reason why we're here. And the idea is we give through software powers to these customers so that the customer can do with our software, with all of your softwares, 10x what they would be able to do if they were not using our softwares. And so how do you think about delivering a product to so many customers?

3:18Like we were talking about earlier, it's for everyone, right? When you joined, you were telling me the story that I think is great for everyone here, that the answer to who's our customer was everyone. And I said to you, I said, well, what do you do with that? I mean, how do you prioritize? How do you think about it? So that was where you started. So walk us through then kind of how you sort of figured out how to get alignment and thought about product. Yes. So the first thing you do with that is be happy, right? Because, I mean, if everybody can be your customer, the total addressable market cannot be bigger.

3:52It's everybody, right? And so that's not a bad place to start, right? So in order to scale, to significantly scale, you need to address the problems of many, many people. If the answer to that question would have been, well, there's these 10 people here and there's 15 people there that can be our customers and that's it, that would also be a very big problem. A problem may be bigger. I prefer to have a very sizable market than to have a niche too small market. That's my advice. How big is your market? But then you turn the coin around and you say, how are we going to solve the problem of everyone and be the best at solving those problems compared with any other alternative?

4:39And this is where the trade-offs start happening. So the first decision we set was, look, out of conviction, and this is fine. Having convictions is fine. You can have conviction. You can have data. Both together are powerful. Let's go and say that our customer is a professional. So you can do a wedding RSVP with it. You can use it for your personal needs. but let's say that as a first step we will focus on professionals. We will make their professional life much better. Lots of discussions, right? Because people don't want to make their target market smaller especially people going to market, right?

5:33But that was the first decision. And then we kept exploring. So one of the things that I've seen that is very, very important is customer calls. I probably did close to 40 in the first two and a half or three months. Start establishing a muscle, customer research that does customer focus groups. Start doing that together with product development. So developing new features, creating a group of alpha testers, a group of beta testers. surveys, forms, of course, to do feedback at a much larger scale, and then look at the data. And this is also very important for me. I believe there's two big worlds.

6:24The world of the data that you can observe, this is what they do. What they do with the product? Yeah, for instance. From the top of the funnel down to the features that they use. So this gives you a lot of information about what they do, especially what they do today with what's available today. But then you don't know why they do it. So many people come in and so many do this and the rest don't do it. It's clear. We have the data. But why? And this is where I think it's really important, especially we are very product-led in that sense, to have this muscle of know your customer. So how do you do that with so many customers?

7:13It's not like you can just have your top ten customers and focus on them. So how do you do a sample? How do you do that? It's research. It's research that you can start with some qualitative hypothesis and then you prove or disprove those hypotheses with customer calls or focus groups, right? So we have groups of customers that fall into different segments or categories depending on their behavior or the type of company they work with and these kind of things. and then we kind of prove or disprove these qualitative elements in our research and then we can also apply more quantitative research, let's say statistical research because the statistic of one is bad but it already gives you some information.

8:07The statistic of 30 is not perfect but it gives you ideas, it gives you trends. Then you apply the statistic of 1 ,000 or 2 ,000, right? Are there some features you can think of? I can think of one, but I'll see what you have to say that you all have done the research on, looked like it was a great idea, ended up developing it in the product, and it ended up not being the path to go down. Yeah, so in our case, the prediction of how many people will end up using. so I one of the key areas of focus for me in understanding the value of our production let's say R &D is how many people use it right so we have more than 150 ,000 customers if we do something that only one customer uses it feels like a lot of effort for just one customer using it right so that's that's not a good thing, but if we can maybe have 5, 10, 15 % of our customers using that, then generally it is a very good return on that investment.

9:23The problem, more than let's say thinking that this is useful and then it ends up being completely non-useful, it's understanding or predicting that something is going to be used by 10 % and then in the end it's more like 5%. And then that also starts conversations around, hey, why did we think it could be a 10 %? And why it was not? So that's interesting. So you pull that experience constantly iterating and then you pull that experience back into the research methodology and the product development process that you put in place. Yes, exactly. So in our product development lifecycle or product development process, what we have is the opportunity assessments.

10:06There's a lot of trade-offs, right? Especially when you have so many customers that use you in very different ways and for very different purposes. You have to trade off this investment for that other investment. You do this, you don't do that. So in that sense, we do opportunity assessments. It doesn't necessarily need to be something extremely sophisticated and convoluted. But it's a thoughtful process of understanding who is the customer you're solving the problem for. What kind of problem are you solving? Why is this problem worth solving? and then why is this a solution that it's going to solve it, right?

10:40And in all that process you say, okay, this is 10%, 15 % of my customer base. This is a problem that has been identified in customer research or in some of these feedback surveys. We also include all the feedback from customer care and customer success and the win-loss from our very small sales team, right? So we are not winning more projects because of this. more customers because of this, et cetera. So we bring all of that, and then we do this opportunity assessment, and we say, okay, this is the solution for this customer segment. It should be around 10%, maybe 50 % of them. They will take it up, so let's go and do it.

11:21How fast are you all iterating? Because being agile in today's world is so important. So when you think about a product, when you think about a feature, I'm assuming you're not spending nine months researching something. Give everybody some context around that, when the risk you take around product, when you're pushing features out to start to test to see kind of what the uptake might be. Something that we learned was to separate the process of thinking from the process of doing. So that's very important for us. Because at some point it felt that, you know, in these cartoons where you have the train and there's somebody that is putting the rails just in front of the train moving, right?

12:01So a lot of times product development was a little bit like that It's like we are doing this but we are thinking about the next thing and in two weeks when we finish this cycle or this Sprint then we need to have that idea ready for that right, so we we separated the two things the other thing that we did was to Assume that the spring in our case is a cycle it's six weeks right so this cycle Is fixed so we have to develop value we can decide how much value is possible but it has to be valuable so it's you don't, I mean if you play solitary it doesn't make any sense to cheat yourself in that sense we are a product team we want to develop something that is valuable for the customer, I will not cut it in a way that we delivered something that is not valuable but you can define the scope and you have to fit it in those six weeks, so it's a six week sprint And the six-week sprint is the research, the thinking, as you said, and then also the doing.

13:05And then at the end of six weeks, you're pushing it out to what, a select group? Research happens in the previous sprint. Okay. While the engineers are executing on your decision, you're actually thinking and working on the next decision. Right. Right? So that's, and usually it's a triad, right? So it's the product manager, the product designer, the engineering manager. So they are part of this opportunity assessment. These cycles happen also when you have built a bit of muscle. So if you have to start doing research from scratch and you know absolutely nothing, then maybe after six weeks you don't know everything.

13:48I remember the first, when I was given the opportunity to become the CEO, So he was asking these questions, and everybody was saying, well, everybody can be our customer. So the problem was, okay, so how do we then, let's say, make the trade-offs for the product roadmap? The trick then, because we didn't have a lot more research than that, was take the top 10 requests in customer care and solve for that in this quarter. And in the meantime, we will think what we will do for the next quarter, based on further research, based on further trade-offs on who the true customer is or who is the segment in that customer base that we want to focus first.

14:32Right. Which isn't always one interesting thing we were talking about earlier was it's not necessarily your top 10 customers, right? Because in your business, you've got so many. I was telling Kim a story that we were early investors in a company called PipeDrive, and I remember meeting the CEO for the first time, one of my partners had led the deal. And I asked them, what were their top 10 customers? And they have a business, it was a CRM business, very much like Typeform in terms of relatively low price points, lots of customers. And I was astounded they couldn't tell me, you know, who the top 10 customers were.

15:04And I thought at first, I said, oh, my God, we're going to lose all of our money. There's no way we're going to be successful in this. They can't name their top 10 customers. But it turns out I was completely wrong. And it was the wrong question because they had to manage the business like you did where thinking about an individual customer didn't make as much sense as the collective group segments yes i use three three parameters to define that customer segment which is the buyer persona right so is it a marketer it's a salesperson it's a rep ops person it's an hr person it's a engineer buyer persona icp so the description of the company where is the company base, what's the size of the company, what's the business of the company.

15:48And third, the use case. So you could have a buyer persona like a marketer in an ICP, like company with 150 employees based in the US and selling software, for instance, doing two different use cases. One could be I want to acquire customers, I need to qualify my elites as a marketer. The other one could be I am preparing an offsite with my team and I want feedback or ideas or simply customer feedback about something that we released last month. So there's these three elements that combined can give you a lot more granularity in everybody, no, no, no, just professionals, well, you know, customer-facing people, but, well, in the end, and there's an element of judgment, right?

16:44So when When we do product, we focus on specific segments, but we know that there's things that will also benefit other segments. And that is a plus, right? If by doing this I'm benefiting the marketer and also the salesperson and who is doing customer acquisition, but also who's doing customer feedback, that might be something that we want to do before something else, right? Because it helps more of our customers. One thing I think, you know, if I was sitting in the audience, it all sounds easy in a way, like as you describe it, right? But it's hard. It's hard. And we all make mistakes. You know, some things don't work as we planned.

17:22I think that's important for everybody because you have to be willing, you know, to make some mistakes and iterate and learn from them. One thing you were telling me that I thought was fascinating was the product journey into video. Yeah. Not because the product wasn't good, but because it impacted the go-to-market. Yes. So I think that's a great story to tell everybody. Yeah, one of the things that I learned is the importance of aligning everyone, right? So, for instance, as a good thing about this is on July 1st, we launched Typeform for Growth. And that was something that we thought about last year.

17:57We developed it actually during last bit of last year and all of the first half. We keep developing it. But everybody from go-to-market to R &D to data to all the supporting functions were working for that specific launch, right? So that's a good thing. Align everybody towards something that needs to happen, right? This is also the learning of something that happened. I mean, back in 2019, we have a product that people love, right? And people say that. We love Typeform. I was coming from mobile gaming. Mobile games are things that people engage a lot with, they have fun with, and I had never listened to so many people saying, we love it, right?

18:44So it was surprising. So we had a great product. And yet, we wanted to keep innovating, right? We have a great product, we want to keep innovating, but this product already has 35, 38, 40 ,000 customers. So how can we innovate fast, right? And the reason was, if we want to innovate fast and not be holed with other things like security concerns, breaking something in the core product, and so on and so forth, let's separate and do innovation with a group. And it was the best group to do innovation. It was probably the best profiles for doing absolutely exploratory work. and they were successful and they created the product Video Ask is out there, it's a commercial product with sizable market and also thousands of customers but Video Ask had some commonality in terms of our customers so there were also some marketers there were people doing a bit of customer or product feedback with it but there were also other farther away use cases And in that sense, it created a situation where if we wanted to really grow that product, we had to grow a separate go-to-market function for it.

20:09And if you do that, you have a different product, a different go-to-market, and the go-to-market needs also then customer care and customer success and eventually maybe some support. And eventually you create two companies. So at some point we said, look, we'll do something different now. We'll take all these learnings and we'll bring these innovations and these learnings into our core product. Because our market segment is big enough, it's defined broadly enough, that all these innovations, all these new features and capabilities also apply here. And by having the existing capabilities and the new capabilities together and giving more options to our customers, the core customers, then we are giving them more value.

20:58I mean, I have to imagine that conversation of saying, hey, we're going to say no, because that's effectively what you're saying, right? We're going to shrink to grow. You know, we're going to focus on our core. I bet, though, internally that was highly debated because it's very hard to say no when you can see all of these customers that you can go get over there, right? And you can build. How did that conversation, I mean, I'm sure lots of people in the audience have had those similar conversations internally Because saying no to revenue, especially when you're small, it's so hard. It is very, very hard.

21:33And this goes back to having clarity of your top priorities, having a few number of priorities. I mean, I think I read some time ago that the word priorities exists maybe for 100 years. although the word priority exists for maybe 400 years so it's more after the industrial revolution that we could not have just one thing we had to have many things and eventually this is kind of the problem so eventually you start being pulled in many different directions because every direction can be a good direction so the difference between this is good or this is critical is very fuzzy, right? Should we do this?

22:26Yes, because it's good for us. But is it going to be critical in the long term? Is this something that is scalable, needle moving or not, right? Because there's plenty of good things that we could do. But what are the three things that we all together should do aligned that is critical, right? And usually there's also an element there which is the kind of, I don't know, there's a lot of uncertainty, so let me place bets. Instead of going for these three numbers in the roulette, let me put a coin in 25 numbers. Because if I don't hit it here, I'll hit it there. but usually my experience is that if you attempt 25 things you will be executing poorly on those 25 things if you apply yourself to and your team to three four things you can more or less ensure that the execution will not be the problem right and then you iterate right so quick feedback loops is also very important in the go-to-market this is something we did right so 2019 we have a good product, high MPS, people love it more than mobile games.

23:43It's like, wow. So what do we do? We say every person that creates a form, shares the form, gets 375 answers more or less per month. That's viral, right? For us, that's growth. Let's have more of these customers. Let's make sure that we create the awareness in the market that this solution exists and that they should use it. But the tenets of that was it should be something better simple than complex. So can we go straight into something? The second thing is it has to be scalable. With 35 ,000 to 40 ,000 customers at the point, another 100 customers was not going to be needle moving. They needed thousands, tens of thousands of customers.

24:26The third thing is quick feedback loop. since we are learning if we could have feedback in three months at that point we can decide whether we double down or we change but if this is something that we will only know after a year you have a bullet that year, right? Instead of four bullets you have one. What would be an example of something that would take and everyone should think of some questions here we're getting short on time so we'll talk a little bit about go to market and then it'd be great to take some questions. when you think about something that has that longer duration feedback loop versus short.

25:02Because I think a lot of companies struggle with that too. I mean, you know, whether it's thinking about where to place, you know, ad dollars, whether it's, you know, where to place, you know, emphasis on kind of new product kind of capabilities. Like, how do you, how do you, because there are sometimes things that you may not know for a year whether or not it plays out, but how do you think about that trade-off? So first of all, I would look at the options. So I go to the team and say, hey, you are experts in different... So tell me what's possible. Well, I mean, and there will be a lot of ideas, right?

25:37And then we can prioritize through, is this idea scalable or not, right? For instance, there's booths, right? We sell low ACVs. if I have a booth here for the traditional product, right? Yep. And that's going to be$600 a year, right? How many people do I have to bring to the booth to actually make this a scalable solution? How many booths do I have to have? Is that even possible, right? Yeah, for a lot of these shows, you'd probably have to have every single person in the conference sign up for the product, right? Yes. Which isn't going to happen. To have a return on that and so on. But depending on the product I would have, for instance, now we have Typhoon for Growth.

26:22This is a higher ACV product. The average is around$3 ,800 ACV per year. If I sell 20 or 30 of these, maybe, right? So that's one of the things. It had to be scalable, right? The other thing for me was in those prioritization, like the scalability, but also the fast feedback. So for instance, paid marketing versus organic. Generally, when I talk to experts, they say, well, paid is faster. because you go, you buy some keywords, you buy some ads, you have the funnel, people who see it, people who click, the click-through rate, the conversion rate to your sign-up, and so on and so forth. We can use different creativities, different copy, we can use different channels.

27:25Okay, so that feels like something. If you go organic, which we already had, and so everything needs to be taken in the context of the circumstances, but in that sense, options and criteria to say, okay, let's focus first on this, right? Because this is the number one priority. So organic, we have to develop a lot of content. Developing content is costly. Maybe now it's less costly, right, with AI-assisted production. So these are the type of criterias I would say. You know, something simple. Like, if I can go from A to B direct, instead of having to go A to B, then to C, so that we can eventually get D.

28:12Right. If I can go A to D, it's better. The second thing, scalable, right? And that depends. So, for instance, a company that I know at 4 to 5 million ARR now, they sell an app that is a solution for freelancers to invoice customers, right? They found the solution in TikTok. And they are focused on TikTok. Right. Right? There's another company, maybe around 2 to 3 million ARR, that is very, very much enterprise. They sold first. They actually built the product almost for one customer. They learned from that experience. And now they are targeting types of customers that are the same. Another company that sells SaaS solutions for SMBs at around, I would say, 45, maybe 50 million now, they have built a massive SDR, AE, outbound.

29:12An outbound motion that's working. For them, it's like they have 700 people, right? And it's working for them. It's definitely not one size fits all. No, no, no. You know, the thing that they explore different options. Eventually, in that range from, you know, like a few millions to maybe 40 or 50, usually one thing that works for you, maybe a second one, is better than a combination of let's do 10 things. Yeah. And you focus the investment and also you grow in the learning curve. Right. Yeah, because you really know those three or four things you did well. Any questions in the audience? Otherwise, I can follow up.

29:53Yeah, I can see right there in the front.

30:00Hey, guys. Adam Babaji-Pycroft, VP Product at 1UP. I was just wondering, so you mentioned working about the six-week product development cycles you're using. Is that something you inherited, or did you kind of consciously choose to switch to that? Sounds a lot like of 37signals shape up? Is that something you're doing, or is that just sort of a coincidence there? We got inspired by that. We adapted it to our ways, but this is something we did, I think, in 2021, or maybe starting in, maybe it's more a 2022 thing, actually, yeah. It's newer. And was it quite a change for the team, I guess, because presumably what we were using like two-week cycles before that?

30:50Yes. The things that changed a lot was the separation of thinking versus executing, the having a fixed timing, not a fixed scope, and also having, I think there's maybe one or two exceptions in the engineering team, but having almost everyone, every team work with the same cycles, which makes it easier to manage dependencies, right? Because when they plan for it, they also talk, hey, I will have to access this code, I will send a pull request, get me a little bit of time to actually do that. When we had different teams with different times and working, starting and finishing because of the variability of that scope, yeah, you know, everybody was super focused on their own task and their own priority and not necessarily having time to solve also and assist other teams' requests.