Visible Blog

Using Software for Customer Success After a year with Visible, we’ve changed up a few pieces to work best with our team and to help scale. It’s interesting to see, over time, how the platforms change Checkout my updates below each section in Red. Something that makes me throw money at people/products/services, is the experience I have with them. Over the past several years, I have noticed the little things companies do for their customers, and own employees, to increase satisfaction via experience. What most people don’t see/understand/have patience for, are the platforms used to provide the service and experience. A great example of this is the ‘legacy’ US banking technology (which I could rant your ear off about as much as architectural facts of buildings along the Chicago river) that manages your account. This system, graciously provides the ‘awkward phone silence’ when a rep is waiting to access your account, going through level upon level of access to view your details. Over time, they have learned to fill this void with trivial conversation/up sell, to make you feel comfortable, and feel like a person who is valued. Building a smooth customer experience is not easy, so I’m going through the important factors of what [a non-engineer] calls their ‘full stack’ to provide great customer experience & service. Monitor: Customer usage is key, tracking your customer’s usage allows you to segment specific users for engagement, testing, up-selling, advocacy, etc. Monitoring usage is also one of the key pieces of information to prevent the all-commanding ‘churn’. Platform: We take this data from our back-end and plug it into our CRM (HubSpot) to filter, segment, identify, assign, etc. We also use Intercom to monitor users for ‘automated’ engagement with a personal voice. Analytics: When you’re scaling, you’re gaining lots and lots of users from your targeted funnels, and then some. Product managers are important in making sure you’re exceeding customer needs and continuing to build the envisioned features, versions, etc. Marketing managers need a ways to identify the best funnels of customer conversion and best ‘cost per acquisition’ price. Having an analytics management product allows them to find the sweet spots and make your user base grow, and stick, like crazy. Customer Success pulls these analytics to further monitor and segment users. Platform: We’re still looking at best fits, but some good ones are RJMetrics, MixPanel, and KissMetrics. Ideally will have this connected in or around our CRM. CRM: Email is something I want to get away from as fast as possible when working with customers. Yes I do sound insane, but what I mean is the traditional email platform (gmail, outlook, whatever Apple mail is called) because there is no good way to mange the customer’s account (and expectations) easily and quickly (Streak is making a hybrid that looks interesting). A good CRM makes all the difference in keeping customers engaged and happy as well as managing a team of account managers. This also keeps Sales and Account Managers from asking too many questions, creating breaks in service, on-boarding, experience, and team happiness (you know what I’m talking about). Platform: HubSpot’s new CRM is pretty slick and customizable, we’re eager to keep customizing it to fit exactly how our business model defines our customers. Engagement/Voice: This section is probably one of the most interesting and emerging of recent years. In times of past, being able to create engagement or a voice inside your software (who is old enough to remember Clippy) you would need a designer and front end developer to hash out several iterations until you had enough and waited to raised more money and hire people to complete this task. Engaging customers keeps them happy while on your app, makes them a sticky user or what I learned as a “Happy Prisoner”. This starts with the welcome, goes through on-boarding, and continues as the ‘Voice’; providing valuable content from specific triggers, advising on product/industry specific news, and providing education through knowledge base, blog, or even surveys (check out an amazing project by Brett @ Visible, the Early Stage Confidence Index for Investors). Platform: We currently use Intercom for our Engagement and Voice, we haven’t found a perfect solution for an on-boarding wizard, we’ll update when found. Incident Management/Customer Management: Most people know this part as your standard customer service platform, having a service like Zendesk to manage your inflow of customer queries and conflicts. There has been a movement away from this as an ‘additional’ product with Intercom or having it hosted in your CRM (stay tuned to see my future post “Why Account Managers should not use their email app”). The important parts are being able to reply quickly, collect customer response data, create reporting, and make better decisions (something that Intercom is currently lacking). Platform: Zendesk is known as a major player here, but others are Desk.com, Happy Fox, Fresh Desk, and Help Shift. Knowledge/Education: The tool to help scale and educate, and even more is to create advocates and emerge as an industry leader (more on this in Advocacy). You want to have something that provides easy searching, great UI, syncs really easy to your app, and is super simple to maintain (non-devs will manage this). Platform: Still looking for a good fit here, most Knowledge Base systems are normally packaged with Customer Management, so we want one piece of the package without paying for the whole thing. Advocacy/Marketing: Creating a strong following of users brings a company from ‘cult-like following’ to ‘industry leader/expert’ (Product Hunt is an amazing example). We started with content on our Twitter page and have now pushed forward with our Blog. We’re pushing through great side projects to continue our vision to bring visibility between investors and company founders. Platform: We’re using Buffer to manage our social media posts and have our blog hosted on WordPress Over time, we expect to change a few platforms, build internal tools, and condense the amount of 3rd party applications we use to keep our customers happy. I will say that a secret sauce for a non-technical operator is Zapier (saved this for the readers who actually made it this far into my ‘essay’) which makes me scale my processes like never before.

Start Calculate Bookings Welcome to our latest post in our MVM (Most-Valuable-Metric) series, last time we filled you in on Lead Velocity Rate. Today we want to drop some knowledge on bookings. Specifically we want to fill you in on why bookings are great, how to calculate bookings and how they differ from other similar metrics. When we first started Visible, a good amount of SaaS CEOs told me about bookings and why they are the primary metric for their company. This was the first I heard of bookings so I looked into it. What I quickly realized is that bookings are a forward looking metric that previewed revenue to come and give a great look into the health of the business. Now that I figured out why bookings were so important, I had to figure out how to calculate and learn a little more. The first thing I learned is that bookings are not a GAAP defined term so the definition may vary depending on the company. However, our goal is to create the standard of bookings for early stage startups to use going froward. Here it goes: Bookings are the value of all transactions in a specified period of time normalized for one year. Fred Wilson breaks it down very simply on his AVC blog, “When a customer commits to spend money, that is a booking”. This includes subscription revenue, non-subscription revenue, professional services, etc. Lets break this down and visualize an example. Lets say for January 2015 you want to calculate bookings and you have the following transactions: 24 month contract @ $1,000 per month (paid bi-annually) 12 month contract @ $2,000 per month (paid upfront) $5,000 one time setup fee (paid upfront) $3,000 professional services (paid upfront) 6 month contract renewal @ $500 per month (paid quarterly) Upsell on 1 month to month contract with new price @ $1,000 per month. Jan 2015 Bookings = $48,000 (You’ll see we didn’t include the 2nd part of the first contract for this calculation). How does this differ from Revenue, MRR or Collections? Revenue is only recognized when a particular service is used. If you have professional services and/or a setup fee included as part of a software contract then the revenue is ratably recognized over the lifetime value of the customer (lets assume 1 year). So looking at the same set of transaction you’ll have revenue of $5,166. MRR only applies to the subscription part (aka recurring) part of the business so the MRR will be $4,500 in our example. Collections happen when the customer actually pays you and the cash is in the bank. Going along with the example above collections in January will be $40,500. It’s important to track all of these metrics in parallel for your business and how they work together. You want to make sure you have future and predicable cash flows coming in (Bookings & MRR) but also making sure you are getting paid (Collections) and that you can recognize it (Revenue).

At Visible, we talk every day with founders and early-stage investors from around the world and have found a few key themes emerge in our discussions: Founder frustration with investors who don’t deliver on their promises – the connections they say they will make and the expertise they say they will offer Investor frustration with founders who go off the grid, only to emerge and make “asks” when it is too late to save a project or company Blame being placed by people on both sides of the table instead of analyzing the root cause of the relationship breakdown Fortunately, the venture platform model (also called network or community model in some places) has become more and more pervasive, indicating an increasing desire by investors to put more “walk” behind their value-add “talk” and a desire by companies to work with investors that embrace this strategy. The success of firms like First Round and Andreessen Horowitz, in both returns and mindshare, is a testament to this trend. For the uninitiated, Frontline VC’s Kim Pham recently wrote a great primer on the subject. At its core, the venture platform model is focused on helping companies and investors get back to building businesses by using transparency as a tool (TaaT) to unlock growth that would have otherwise not been possible. In many ways, it means proactively opening the network communication bottlenecks that can prevent strong venture communities from coming into existence organically. Companies want engaged investors and investors want to stay up to date on a company’s progress in order to make good on the expertise and connections they promised prior to wiring the money. So if both sides understand the importance of keeping lines of communication open and subscribe to the idea of the venture platform model as a way to accelerate growth, why is the ball still being dropped time and time again? Not realizing that habits form early – in companies and in their relationships with investors Term sheets are signed, money is wired and the company building can begin in haste. Unfortunately, a lot of investors and founders forget to set up front expectations for how the relationship will work apart from “please help me return capital to my LPs”. When there are one or two investors on a cap table, inbound requests don’t seem so daunting. When you raise your seed round and add 6 more investors, then a Series A with 3 others, the inbound requests become extremely distracting and pull you away from things like product, sales and hiring. Spending a few minutes each month putting together your investor updates can help you get some of that time back. Better yet, they tend to gain momentum as positive reinforcement – in the shape of more intros from the network and expertise assistance from investors – starts pouring in. Thinking it is too late to start When investors see a portfolio of 10, 20, 50 companies across multiple funds it can be easy to start thinking that things, from a portfolio communication perspective, are too far gone. They prefer to “wait for the next fund or accelerator class” to get started which sounds a lot like the way people who need to get back to the gym sound after their new years resolution wears off. Biting off little pieces – again, same principle as getting back in shape – is a great way to start. As an investor you have inbound requests to meet your companies and outbound desires to make the right introductions. Having all of your key investment data in one place pays huge dividends by saving time and mental overhead and truly leveraging the power of the network you have built up. The oft-used proverb about the best time to plant a tree comes to mind here. Visible: More time for more important things That means less time spent copy and pasting messages to three four or different investors. It means not having to dig through a Dropbox, email and Excel each time someone needs info on one of your portfolio companies. It means getting back to the business of building businesses. If you need some inspiration, our reading list is a great place to start. We’ve collected some of the best advice from around the investor community and continue to update it as new posts and content roll in (Note: everything you see there – reporting metrics, templates, etc. can be setup and tracked quickly and easily through Visible). If you have any questions about getting started, feel free to get in touch.

Growing or Scaling? I was chatting with a student looking to get into the startup world. This particular student wanted to join a newly launched app and help “scale” the company. I paused and asked, “Do you mean help grow the company or scale it?”. Super early stage startups are rarely “scaling”, rather they are doing anything possible to grow. They are doing things that are not scalable, trying to find product-market fit and cold emailing just about everyone to try their product. When you are trying to grow your company, you hope to find a repeatable process that will scale one day. Growth means every unit of input yields the same predictable output. Scaling allows your output to exponentially grow while keeping your input the same. Here are 2 great examples I’ve encountered at Visible : 1) I was the sole BD guy when we started and I would ad-hoc email potential customers, it was too early to do anything more sophisticated. I would track these potential customers in Streak. Over time, our core customer developed and I knew sending 100 emails yielded 50 responses to 35 demos and 10 deals won (made up #s). Luckily, we had some growth so we were able to have Brett join the team. He quickly took my archaic (yet proven) process, setup a Tout account, and in the same amount of time he was able to effectively email 10x the amount of potential customers. With the same amount of input (hours) we were able to scale our outbound sales 10x. Which brings me to point #2. 2) Since we were successful in point #1, I increasingly had to help setup trials for potential customers, onboard new customers or handle support. I was primarily using email to handle all of this. It was tedious but it was too early to try and setup a help desk or an onboarding process. Eventually this wasn’t repeatable and things broke down. Nate then joined the team to handle customer success and operations. He tricked out Intercom, setup potential trial-ers on Formstack, on-boarded new founders on Lesson.ly and has our whole process buttoned up and scaled…for now. Brett & Nate are still testing out new distribution channels, re-engagement campaigns and more by “brute forcing” them. When something works, we will scale that process. Startups are in a perpetual state of grow -> scale, grow – > scale, grow -> scale. Coincidentally, Jeff Bussgang at Flybridge Capital just penned this post on “Scaling the Chasm” which is a great read. Related Resource: 7 Startup Growth Strategies There is a certain sexiness that comes from scaling a startup (that’s why they exist) but to get there you have to put in the work in and find out how to grow the company first.

Last week we launched some great improvements to the most popular features of Visible: Portfolio charts, reports & custom dashboards A new update builder for founders Ability to quickly add popular metrics Take a look below! Portfolio Charts, Reports, and Custom Dashboards: Fund managers can now create their own charts comparing metrics across any of their portfolio companies. Just click the “Reports Tab” from your fund page . Investor Updates Builder When building an investor update, founders can now add rich text that is added to the highlight stream and sent in the notification email! Notification Emails: The notification email your stakeholders receive when you send investor updats will now include your company logo & the highlight text from the update builder. You can reply-all in the email! Popular Metrics: In the Manage Metrics area founders can now easily add popular metrics to share with stakeholders .

Transparency: Who are Visible’s Competitors? I probably get asked who Visible’s competitors are on a daily basis. This questions bugs me and I feel like people ask it for one of two reasons: They ask the question just to ask the question. My guess is that they ask it to make it feel like they are asking a “hard hitting” question and seeing how I respond. They are considering buying a portfolio monitoring tool and want to know where else to look so they can compare. For person number one, there are so many other things I’d rather talk about as an entrepreneur and operator than my competitors. I’m fully aware of them and know who they are. You also do not need to be constantly forwarding me emails about my competitors because I’ve already seen them, signed up for their service, and know what they are about. I’m living and breathing this 24/7. For person number two, I’m about to make your job incredibly easy. Below are all of the direct Visible competitors including their pricing relative to other solutions and what their offering is. You’ll see I didn’t list pros or cons or compare against Visible, so feel free to check them out. I’m incredibly confident in the value our team offers and our product. We are laser focused on crushing this problem. I cant wait for everyone to see what is next… Again, the companies above are people I believe directly compete with Visible. There are other services out there that have similar functionality but it isn’t their core focus. Next week we are releasing a breakdown of their entire software industry for the venture investing market–stay tuned!