Launching a New Category is Hard: Lessons from Productboard’s Journey to Breakout Growth

Episode 37 December 08, 2020 00:54:11
Launching a New Category is Hard: Lessons from Productboard’s Journey to Breakout Growth
The Breakout Growth Podcast
Launching a New Category is Hard: Lessons from Productboard’s Journey to Breakout Growth
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Show Notes

With a product management system that helps organizations get the right products to market, faster, by centralizing feedback and making insights from customers available all in one place, Hubert Palan, Founder and CEO of Productboard has created a new category. 

 

The idea of a blue ocean awaiting a unique invention always sounds exciting, but in this episode of The Breakout Growth Podcast, we learn that in reality, building sustainable growth when everything is new and direct competitors do not yet exist, also comes with tremendous challenges.

 

Sean interviews Hubert at an interesting time as the Covid-19 pandemic has accelerated digital transformations around the world. Companies like Zoom, serving established markets, quickly capitalize on new demand, but for Productboard the problems they solve are less understood. Therefore, growth has required a constant effort to build problem awareness while expanding the solution to meet changing market needs. 

 

We trace the company’s journey from its initial bottoms-up focus on emerging startups and SMBs to robust top-down solutions that now also include mid-market and enterprise businesses. We find out how the team has grown to hundreds of employees and evolved to serve over 3000 customers with both self-service and high-touch sales systems and why Hubert sees a whole-market strategy as the right approach to meet the needs of the market and defend against competition. 

 

For anyone focused on driving growth, this interview includes valuable learnings about the importance of authenticity in creating value for end-users. Hubert says, “The reason why we exist is to make a world where every product is extraordinary and exceptional,” and it is clear this mission has informed the culture and mindset behind Productboard’s breakout growth. 

 

Take a listen, this is one of our favorites . . .

 

We discussed: 

* The company’s journey from serving the needs of small startups to a client roster of more than 3000 companies including Marriot, ZenDesk, Disney+, and more (2:18)

 

* How the business model works from self-service options for SMBs to high-touch sales-driven approaches for mid-market and enterprise clients (4:10)

 

* The recently launched free customer feedback portal that closes the loop between product management teams and customers and provides a viral loop to accelerate growth (5:49)

 

* Hubert’s journey as CEO, and how he applied lessons learned from his Berkeley MBA professor, Steve Blank, to build the business (9:22)

 

* Building the growth canvas for a blue ocean business model, and how iteration and prototyping helped solidify the vision (11:50)

 

* How raising $45 million just prior to the pandemic is helping grow the team to meet market demand (17:30)

 

* Why digital transformations are changing the potential market to include companies like Marriot, Sherwin-Williams, and Cartier, and why that was interesting for investors (21:56)

 

* The challenges and benefits of moving upmarket (28:40)

 

* Managing culture as the company has grown to serve multiple markets (31:50)

 

And much, much, more . . .

View Full Transcript

Episode Transcript

Speaker 0 00:00:08 Welcome to the breakout growth podcast, where Sean Ellis interviews, leaders from the world's fastest growing companies to get to the heart of what's really driving their growth. And now here's your host Sean Ellis. Speaker 1 00:00:26 So to the breakout growth podcast, I interview Hubert Palin, founder and CEO of product board. One interesting area we discussed was how product board has overcome the challenges of creating a new category product board is really the first solution that centralizes feedback from customers to help product teams build the right products and features faster. So Hubert says the challenges of creating a new category often require a lot of funding, and fortunately for them, they raised $45 million just prior to the pandemic. So probably board now supports more than 3000 customers ranging from small startups to larger enterprises with both self service and high touch solutions. So to support this growth engine, the team has expanded to hundreds of employees, which introduces new challenges of keeping everyone on the same page. So speaking of staying on the same page, I want to remind you to check out, go practice.io. The immersive simulator that I built with a former data scientist from Facebook, all leg Yaqoob uncuff, this program empowers teams to learn how to use data, to make better decisions around product marketing and growth, and really stay on the same page based on the facts that those data show about their business. So check it [email protected], but for now let's get started with Hubert Palin, founder and CEO of product board and find out what's driving their breakout growth success. Speaker 0 00:01:57 Hubert, welcome to the breakout growth podcast. Speaker 2 00:02:00 Hi Sean. Great to be here. Yeah, Speaker 1 00:02:02 I'm really excited to dig into product board. I know that, um, you guys have been growing really quickly and so, um, before we get into the details of how you're growing, it would be great. If you could just give us a quick introduction to what product board is and what problem it solves. Speaker 2 00:02:19 Absolutely product board is a product management system. We help product teams and product managers, um, get their rights, the right products to market faster by centralizing a feedback from customers and making sure that all the insights from the market in one place. And then more, more importantly, did they're linked to the feature functionality that ends up on the roadmap and, you know, really it's about making sure that you're building the right thing and that the things that your team is prioritizing and, and putting on the roadmap is substantiated and justified by the, um, the needs of the customers. The, the, you know, the customer is in the center and somehow it's been missing from all the systems that we're using in the product management world. JIRA doesn't have like a customer, obviously a sauna Trello. It it's not there. Speaker 1 00:03:11 How about people kind of done that, um, prior to you, uh, coming onto the market was they use things like Gera and Asana and just tried to, to kind of tweak them to the, to the use case, or is there something else that that was available? Speaker 2 00:03:25 Yeah, it's kind of interesting. It's either spreadsheets, PowerPoints, it's kind of a traditional world before a system designed for this set of needs. Uh, you know, it was created that that's the status quo still predominantly, or people use engineering task management systems, as you just mentioned JIRA, or they use just general project management tools like Asana or Trello to just try to cobble together a bunch of these different, uh, different systems. But it doesn't really scale if you have a large broker organization across many different product teams and you're building a complex product, like you really need a system that's optimized. That Speaker 1 00:04:03 Makes sense. So, um, you just said, if it's a, if it's a large product and a large team, is that, is that really your, your typical customer profile or what, what is sort of the range of customers that you guys, uh, that you attract and retain? Speaker 2 00:04:16 Yeah, good question. You know, this is not, this is not a static world, right? So we started bottoms up. We started with smaller teams and simpler product organizations because, um, you know, when you're starting, you want to be focused and you want to have a very clearly defined set of needs that, that, that you're satisfying. But then since then the market has been pulling us up. There's so much opportunity and the larger the product organization is the more complexity there, the more product complexity, organizational complexity, and that's what we've been experiencing. So now we're selling to mid-market or even to enterprise companies to larger product organizations, but it's a, it's an evolving, it's a, you know, kind of a moving target right now. We have companies that are as big as Zendesk or Autodesk as, as customers or Disney, you know, Disney plus the team. Um, and then also obviously, you know, many small startups, but we're in this unique position that there is no incumbent, there's no Salesforce of product management, it's really new green field. And that that's a great opportunity that it also has a lot of challenges. We can talk about it, for sure. Yeah. Speaker 1 00:05:22 So is it a, is a SAS solution and you, do you sell by like by seed or how, how do you actually price them Speaker 2 00:05:29 Product? Yeah, it is the B2B sauce, uh, we price, uh, per seat. Uh, and then, you know, we have a self-service, uh, public pricing as well as obviously sales assisted motion for larger companies who need, who need help with the purchasing process. Yeah. Speaker 1 00:05:49 So speaking of self-service, I assume that, um, you, you, I, I saw that you recently launched a free customer feedback portal. I assume that's probably feeding leads into the self-service business, or is that something that is, um, is for really both, both kind of the high end customers and the smaller companies? Speaker 2 00:06:09 Well, it's, it's both in the sense that as a product manager, you want to have as many touches with the market and with your customer base or even the prospects. Right? And so the, the, to the extent you can listen to the customers and understand their pain points, to the extent you can understand how, um, the different customer groups differ, how they're segmented the better, because then you can define the focus and get, say, okay, I'm going to, I'm going to address the needs of a specific customer segment. Now, how you do it is that you, you go directly to the customers, or you talk to the other people in the company who talk to customers, sales, marketing, customer support. And what we did specifically with the portal is that we said, Oh, this is a use case where the customer, uh, can talk directly to the product organization, to the product decision makers through this portal, which is a, also coincidentally a great viral channel because, you know, the typical B2B SaaS tool at a company doesn't really have any surface area that the customers interact with. Speaker 2 00:07:12 If you think about Salesforce, Salesforce is inside the building, right? It's like an internal tool. Uh, the, the advantage of the product system project management system is that there are these touchpoints that are like in front of the customer or the audience. And so in, in our case, small companies, large companies, they can set up the portal and start quickly collecting insights and feedback from the users then, you know, to your growth expertise. It's also a great, great growth loop and viral loop because people see the portal, you have branding there, uh, and S you know, it, it, it helps, um, to generate leads as well. Speaker 1 00:07:50 I definitely know that that space well, because I used to have a business called Kuala Ruth that, uh, had billions of impressions across a lot of sites, but we sold it to a private equity company years ago, but, uh, it definitely, it was, it was an awesome engine in terms of all of that exposure that you get with, with branded placement on, on client sites. So I can, uh, I can understand that the benefit, particularly on the viral side there, and, and then they, um, you know, especially if you've got a, a good way of transitioning those people to, uh, considering your broader solution and driving upsells, then, then that's a, that's an awesome, Speaker 2 00:08:27 Yeah. And it's also something that can be set up quickly and easily, you know, sometimes the B2B systems in house, like, you know, the internal workflow systems, you don't get much value until you really put a lot of data into it. And the advantage of something like the customer feedback portal that we launched is that you can very quickly throw out some ideas that you want to validate, or that you want to collect feedback on, and, you know, you can start doing it right away. So it kind of helps with adoption as well. Right. Speaker 1 00:08:56 And then, so, you know, you're, as the founder and CEO, uh, you've been there from the, from the early, early days, what, um, what was sort of that transition like, and I guess everything from what led you to the idea, and then when did you, when did you feel like, okay, this is, this is validated. We really have something here let's get aggressive about growing it and kind of what, what did that, uh, early stage look like for you? Speaker 2 00:09:22 I, you know, my story is kind of the typical experience, your own pain, and then go try to solve it. So I was, uh, I was a VP product today, uh, at a company in San Francisco. And, uh, I've just been experiencing the pain points of, of navigating all the feedback, uh, being in the middle of the perfect storm of sales, marketing, customer success conversations, trying to align everybody at the company and try to create a kind of a shared mental model, you know, who is our customer? What is it that they need? Why are we building something? Why are we not building something else? And so I decided, Hey, I'm going to, I'm going to build it. And then, you know, the early days and Steve blank was my professor at, uh, I got my MBA at Berkeley and I just completely followed that lean startup methodology. Speaker 2 00:10:14 We went out of the building, we, we talked to customers or prospects we've done. I mean, we talked to almost 700 people. You've done 13 different versions of the prototypes until we arrive to the current, you know, Cordy, the initial UX architecture of the product. And it was just like a lot of iterating, a lot of, a lot of testing, a lot of customer conversations. And then slowly, I mean, you know, the nature of this, of a product like ours, it's a complex B2B system. And kind of, you know, the, the minimum feature set that you need to get in order for the product to be viable is actually pretty broad. And, you know, we missed, you said, like, let's try the smallest segment, but the biggest pain point and focus on that. And we found that in the, in the lack of like the customer centricity and customer insight, you know, the lack of a connection between the feedback, what is the feedback and the feature functionality that is plentiful in JIRA, you know, other tools. Speaker 2 00:11:09 Um, and then we went from there and I remember early on having a conversation with one of my early angel investors, like, okay, you know, it's not growing as fast, where are you going to do grow faster? And, uh, and just like, Hey, we need to keep building. We need to keep, keep solving the needs and made sure that we get to a, um, to a place where the Mainer workflow is complete, where you go from the insight through prioritization to sharing the roadmaps. And then it started growing quickly. You know, we really product maturity that would go to us through that fit product market fit. Speaker 1 00:11:46 And so how did you, how'd you keep from, as you said, it, you know, at the minimum feature set was pretty broad. How did you, how did you keep from over-engineering and kind of, you know, starting with that kind of end end vision of what you want to get to, what did you decide? How did you, I mean, that's part of what your product does, I guess, but how did you decide, what does that, what does that minimal feature set that that's going to make it a must have product? How did, how did you narrow it down to that? Speaker 2 00:12:11 Yeah. And look, it feels hard and we definitely over-engineered in many aspects and then had to go back and simplify and, you know, we're still actually simplifying right now. Um, but it was a learning process around it. Like I always had that mindset and the, the, you know, my mental model around problem space and solution space. And I, and I knew that the problem is there and it's, it's, it's, you know, the, the, the challenge for the kind of company we are for the businesses, how do we create simple enough solution that will solve the need again, because it's a complex set of needs, it's complex enterprise, you know, workflow. And, um, so we just kept making sure that like what we are building the functionality, that it is really solving the biggest, the biggest needs that, that helped, you know, we knew that we are not building the wrong thing. Speaker 2 00:13:01 We just, you know, the, the feedback was positive. Like, Hey, keep building this, like, this is okay, I need this, I need this. I just need more because, and we understood why, and just kept going. Um, and we, you know, we were very focused on the small teams, initially, the smaller simpler organizations, not complex large products, as I mentioned. And, and, and I always talked about the core was the core experience. What is the experience that an individual product team needs in order to succeed and be focused on that? And then later on, we started adding more collaborative functionality or more functionality, you know, for, okay, now we have to protect teams and then you have three product teams and then 10 product teams and how the production level. So very deliberate kind of, you know, strategic set of steps, hope to go. Speaker 1 00:13:48 Did you, did you have any, um, does any examples come to mind of, of completely flawed assumptions or very often assumptions that you had going into it? Speaker 2 00:13:58 Uh, the look, the challenge was to stay focused on, uh, like the, the, the initial segment, because I know you've probably seen it, right? You're like you launch a product, there's the initial positive break market fit. People start using it. Then, then they start asking you for zillion adjacent use cases and different personas. And so the, um, that, that, that was one challenge, just like to stay focused on that. And I was like, Oh, customer success teams need this. And sales team would have benefits. And so-and-so the other thing that was challenging, especially in our case, was that there is, you know, there's a high level strategy planning, which is very unstructured in some aspect versus the day to day listening. And then, you know, once you built something and then scaling a product, and then, you know, you already have kind of like the nucleus and the faith, then you go and you iterate and make it better and improve things. Speaker 2 00:14:54 We spend a lot of time initially building kind of the blue ocean strategy, kind of a solution, or, you know, the high level, um, business model, canvas kind of thinking. It's not that we built a business model cannabis, but it was, we spent a lot of time thinking about, can we build a solution that's going to be for the early ideation and the early, you know, lean startup product market fit, um, um, you know, solution for that sort of problems. And then you realize that if you want to have a system that going to be used day to day, that every product starts as the initial, okay, I need to get to product market fit, but then, you know, it's, it's, it's a very short amount of time in the overall time spent of the product. And then also it's the time of the product, where, where the teams have the least resources. And so the value that you create, even though, obviously you need to find a product market fit, but you can't really capture the value effectively, unless you can then say, and support the product throughout the life cycle, you know, later. Speaker 1 00:15:57 And they're also more likely to go out of business at Speaker 2 00:15:59 That stage. Totally, totally, totally. So we basically kind of like, you know, shifted more focused to where it's, okay, you have a product in the market, you have feedback, you're, you know, you, you have the initial broke market fit and then day to day, what is it that you need to do in order to not lose the sense and stay focused? What are the key next things that you should be focused on and, you know, what needs to satisfy and has been working really well. Speaker 1 00:16:23 That makes sense that it comes back to the business model that you said, if you're, if you're SAS recurring revenue, if you, if you essentially are just serving sort of one piece of the product life cycle, um, you're, you're not going to have long-term retained customers, and it's really hard to build a successful business doing that, but serving that ongoing use cases is probably put you in a much better position to retain customers long-term and build a much more interesting business. Speaker 2 00:16:48 Yeah, yeah, exactly. And there is, I mean, if you're building a software for, uh, you know, the, the corporate innovation centers, like they, you know, that that is an ongoing repetitive process, right. But it's, it's not the core of the business. Like these centers always have fewer dollars. It's just the percentage, you know, 10% is going into innovation. And then, you know, what's, what's going into the, the core of the, the, the core products and enhancing them. That's, that's much more value for the companies typically, Speaker 1 00:17:19 Right. And even in corporate innovation, the failure rate is so high that, um, you know, you don't want the blaming the product on something that probably the failure rate would have been pretty high either way. But I mean, clearly, clearly the decisions that you've made, put you in a great position, um, you raised beginning of this year, um, I think it's $45 million. So your total up to $65 million. So clearly all of that, all of that honing in on the market and making sure that problem you were solving was one that was important to people, and then getting, getting that solution, right. Put you in a, in a great position to clearly navigate the pandemic in particular. So $45 million, right before the world shut down, probably probably made things a little more comfortable for you then than some of the companies that were, um, at the, at the wrong part in their fundraising lifecycle. Um, so what, uh, what, what was sort of, what do you think was attractive to the investors in terms of, uh, what you had accomplished to date and then how, how did those funds help you navigate through the, um, the last yeah, Speaker 2 00:18:27 Six months? Yeah. I mean, a little quite, you know, I had the incredible foresight and that's why I raised the money. Of course not know we got the timing, we got lucky with that. Uh, it just, it doesn't work out. Um, but it definitely helped because, uh, yeah, we could grow the team and we hired a hundred more people or, you know, 210, uh, right now, or even little over that. Um, but really, you know, the, the reason why we raised the money is because we are seeing an incredible fit and not just product market fit, but also go to market fit or, you know, it differs by the segments and SMB versus mid-market versus enterprise, like the product and the company has, you know, different level of maturity, um, by the rescaling debt and, and to, you know, the earlier comment that it's a new category and there's a big opportunity. Speaker 2 00:19:17 Um, if you're building something new and if there's no established category, it also is expensive because you need to invest into the, the, the category creation and product marketing and awareness, and, you know, you need to build a brand. And that comes at a, at a significant cost. We said, the product is helping, right. And the, the, the, the, the viral effect of the product and the positive experience, that's driving a lot of inbound interest and a lot of direct traffic just again, through, through having good prac experience. Um, yeah. But again, you know, having, having, we, we barely burned any of the cash that we raised in the previous round. So I make 50 million in the bank helps. Speaker 1 00:20:00 Yeah, definitely. Definitely. Because I think a lot of companies smartly, a lot of startups in particular smartly, um, got pretty conservative with cash because there was so much unknown. And if your, if your burn was relatively low and you had a good cash balance, that's, that's a great place to be through, through that period of, of not knowing what was around the quarter. Hopefully, hopefully we, everyone's a little more confident on that. We're going to come out of this thing, but, you know, four months ago, um, it was, it was a pretty scary time for individuals and businesses. Speaker 2 00:20:31 Yeah. And it looks so did we, we, we became more conservative. I mean, we, you know, we still grew, but, you know, we grew less than we initially, uh, initially plan because we were, you know, let, let's be careful and let's, you know, let's, let's, let's watch what happens. We got ahead, even though we in a digital software, digital products phase that obviously more benefited right from the, the remote work and all that set up, uh, put together industries, but still in a new category, again, it's different thing. It's not like zoom or everybody understands what video conferencing is and they just go and they find the, whatever the, the best solution is, or, you know, the most spoken of solution is, but in our case, it's a new category. It's like, people don't know what brand management system is. They, they, they are not aware, uh, of solutions or in, you know, in some cases, um, it's, it's even the, the problem of RNs is not even there. And so, um, you know, that, that that's still men that we need to do the awareness and demand generation, and you need to invest there. Um, but we, we definitely were more conservative in Q2, Q3, Q3, you know, things started bouncing back, but Q2 was a rough quarter. Speaker 1 00:21:44 So, so clearly again, like no one raises $45 million if they don't have pretty good numbers in the business. So, um, what, you know, both, both in, in recent months, but even, even before the pandemic, what, what got you from where we talked about just honing in, on product market fit initially to, to the growth levels that could support that kind of a fundraise, um, particularly given the challenge that you mentioned that, you know, new, new category, people aren't necessarily even aware that the product is there. What is, what has been the most effective part of driving that acceleration and, and growth through, through those challenges? Speaker 2 00:22:22 Hm. So for you few things, one is the opportunity in the market and kind of seeing signals that we're not building a product that just for a niche, um, you know, segment in the market that as software's eating the world and as digital transformation is happening, we've just seen across our customer portfolio. And we have 3000 companies as customers now, you know, there's, it's a, it's a, it's a lot of data points to look at. So we've seen that we have companies that are very much a digital natives companies like Zendesk, you know, and like just core software product is the business. But then we also saw that we have companies like Marriott or, you know, um, car TA like very traditional businesses, chairman Williams, you know, it's a company that sells paint, uh, that are undergoing digital transformation and that, you know, they need to be competitive on the digital frontier and that that's, that's where differentiation happens. Speaker 2 00:23:25 And that was very interesting and important for investors to see that the market is much broader. And then the other thing about product management is that, you know, there's many more people interested and they have a very, um, very vested interest in the success of a product. It's not just the product teams. It is sales, it is marketing it's customer success. Like if you want to be successful, everybody wants the product to be great. And they want to be heard. They want to have the opportunity to provide input. They want to have visibility into what's on the roadmap what's coming out. And that just turns this opportunity into much bigger market. That it's not just the product managers. It sounds like a marketing automation tool. You know, we're just the product. Uh, the marketer is the user. I mean, there's a mist of different ways of monetizing or by seed, but you might by the volumes or whatnot, but in our case, the product is used and exposed to product and marketing and sales and customer success and support, you know? Speaker 2 00:24:28 And so that, that was another thing that, um, that was great for the story of our growth. And we had two data points to show that we could show that, you know, the paid seats. And then we have other contributors seeds that the people are using product board across the whole company. Um, which again, just seeing the market opportunity and then the engagement metrics, adoption metrics, you know, how people are using it, how it's like all of that. It was part of that fundraising story. And just like our go to market, you know, how we are the inbound traffic, inbound leads, engagement. Yeah. All that. Speaker 1 00:25:05 So I, but I assume that it's the product managers that initially discover it. And then, and then it, from there expanse to some of those other types of users, Speaker 2 00:25:14 It is mostly even though there's, um, there's many scenarios where somebody else had the company discovers product work, like engineers that are frustrated, they don't get the visibility into the product prioritization process. And they discovered product board and they say, Hey, Mr. Product manager, Mrs. Program manager, you should, you should check this out because it would help our whole company, your yourselves basically, but the whole company or customer success teams, customer success teams that aren't doing QBR quarterly business reviews, or that are having conversations with customers. And they're frustrated. They don't have visibility into what the product team is working on. And they can have very informed customer conversations, again, like big advocates for us. Speaker 1 00:26:00 And that's the customer feedback portal been, been helpful for reaching some of these other groups or is that primarily again, going through the product managers? Speaker 2 00:26:10 It is. I mean, the, the, the portal is something that exposes the product and that it's great if, you know, company set it up. Um, we have Epic games as a customer and they set it up, uh, for their community and they have bunch of products obviously, but so they, they now have a couple of portals set up and then, you know, there's hundreds of thousands of users, uh, going to these portals and they see it. So it's a, it's a little more difficult to track that because unless people really go through the, you know, through the branding on the portal, then it's indirect conversion. Right. So how do you track it? Like they might see the brand and then they go and they type it directly into the browser. Um, but it, it still contributes. Speaker 1 00:26:52 That makes sense. So, um, are there any other like major, uh, challenges that you felt like you had to overcome to, to, to get? I mean, there's probably a ton of them, but any that are standing out in your mind of, of noteworthy challenges that on the growth side that you had to overcome to get to this point. Speaker 2 00:27:08 I mean, there's a lot, there's many challenges. You know, this isn't, it's not as straightforward. We started as an inbound self-service business. I'd relying on inbound free trial, you know, 15 day free trial. But then as you grow as a company, you need to learn how you switch, how you switch from inbound to outbound, because you want to compliment the pipeline makes and do you want to start selling top down, especially as you go up market, then you're satisfying the needs of the larger broker organizations. So there's a lot of learning and we're still going through it and still figuring things out there. How do you go from the SMB to mid-market and enterprise the needs are more complex. It's obviously different purchasing process. So there's a lot of things that would be needed to figure out what was their relationship with the self service experience and the self-service, um, you know, like just the sales service customers, when do you touch them? Speaker 2 00:28:01 How do you expand them? What is the right motion? How you do it, like, you know, some product managers don't want to be talked to by sales and they just want to experience the product and they want to have very kind of product specific product expert conversation. Um, and so we're still learning how to, how to know who to talk to, in what way, how do we segment them? You know? And so there's a lot of, lot of things that we're figuring out and the, in this thing, it's kind of the opportunity and the open market there it's, it makes it almost more difficult because, um, you know, it's, it's, again, it's not like there's Salesforce and we were pipe drive, building a better CRM for SMEs. The market's open out up there, which you just need to be thoughtful how quickly you go up market, because it went too fast and well, you know, it takes time to build the enterprise scaled product. Then we've made incredible, uh, incredible progress. Then, you know, now again, large companies are using us, but you need to be thoughtful along the way, the trajectory just like, you know, strategically and stay focused. Speaker 1 00:29:10 Well, even, even the question of, you know, do you go up market or not? I think if you look at a company like HubSpot, um, clearly entering a, a different maturity level of, of kind of the CRM market, um, or marketing automation or whatever the heck they are now, but, um, they've, they've really sort of carved out a, uh, a smaller company than, than say Salesforce has, or, you know, some of the other higher end market. And it seems like that strategy has served them pretty well. Um, do you feel like, because this is more of a, um, you know, wide open Greenfield opportunity that it's, it's, uh, there's, there's more of an opportunity to kind of serve the market more broadly or, um, what what's sort of the difference between a mature market and a more of an emerging market in terms of that decision? Speaker 2 00:30:01 Well, the, I mean, the, you know, the difference in the, in the, in the nascent market and the new market is that you need to educate the market about the category and well, the problem, and then the solution and the, and, and you need to be, you need to be more thoughtful and more focused because initially this, you know, it's expensive, you don't have the resources and so on. And, and so the, the, the cost of acquisition might be higher because of that. Again, like if you have product and, you know, it starts, it starts, it starts spreading through the product that helps, but when you're then going top down and you need to reach the chief product officers, or, you know, the heads of product with larger companies, you need to explain what the product does because they don't have the, they don't have the concept of the category so that you need to overcome that, right. Speaker 2 00:30:47 And you need to do a lot of market education. You need to do a lot of product marketing and great content and explain the benefits and the value that you get out of running your product organization in a more efficient way. And, and again, that takes time. And that, that takes resources. Whereas if, if you're building a better CRM, or if you're a HubSpot and you're competing with Marketo, like, you know, it's, it's, it's a different, I mean, HubSpot in the early days actually created the marketing automation category. Right. And it's like, it wasn't new category, but now it's different. So it just, yeah, it's like you invest into slightly different type of content and slightly different demand gen strategies than, than you do in an established market. Speaker 1 00:31:28 But it seems like, um, you know, as you, as you've moved from the bottom up approach to one where you are going both top down, bottom up, and, you know, as you said, some, some of these organizations aren't going to want to talk to a salesperson. Some, sometimes the salespeople are going to have a really big impact on a sale. Uh, I've got to imagine that the complexity of your organization has, uh, has, has changed quite a bit, or it's become a lot more, um, layered in terms of the, the different pieces there. What, what does it look like today compared to say a year and a half ago, in terms of, you know, how sales, marketing, and customer success growth, how, how, what are the organizations that even exist and how do they fit together? Speaker 2 00:32:07 Oh, yeah, that's a great question. And a big topic. And I, you know, my board would always joke, like he was going to show up again and talk about segmentation because they kind of like a recurring theme, like, okay, how do we segment the market and how do we change the emotions and, you know, or do we end up in arrests? And, um, and then you also want to do it in a way where you keep it, stuff like that you're growing up market and you're abandoning the bottom of the market because you want to stay protected and you don't want to expose yourself to bottoms, uh, you know, disruption or low disruption. And so that, to your point of degrees has complexity because you want to keep playing there and you want to keep offering a simple user experience to the, to the, you know, smaller companies and simpler teams and kind of have a smooth, initial and experience, but then how do you expand and or how do you go, uh, tops down? Speaker 2 00:33:01 So, I mean, yeah, we now have a sales team. I mean, I'll have both inbound motion and we have outbound as DRS, and we have sales team that's focused on SMB and we have another sales team that's focused on, you know, upmarket, the mid-market enterprise and the emotions deferred, uh, you know, SMB is, is very much inbound driven, even though there is a bound aspect. And then upmarket is much more about POC and, you know, different value proposition and, you know, sophisticated sales enablement. And, um, but you know, you, you, you kind of do it, you, I mean, that's why you also raise money because it is, you know, you need to hire the people. And, but the good news is that it's more defensible because if you do it right, you know, you are protected at the bottom. You're, you're going up market quickly. And time is of the essence, Speaker 1 00:33:51 You know, give anyone a real beachhead to, to gain traction, to, to compete with you. Speaker 2 00:33:55 Yeah, yeah, yeah. But again, you're doing it because the opportunity is there. Right. And, you know, it's, it's, uh, like all the signs in the market are points are pointing towards the great opportunity. And so, yeah, that's, Speaker 1 00:34:10 But it's interesting because I think about like, um, you know, by the time I left logged me in sales was, uh, was a pretty big part of the culture there. And, um, yeah, I went to Dropbox about six months after log me in, and it was much more of a self-service model for a long time. I'm sure sales is a big component now, but it's amazing just how, how different the culture's become when it's a product. And self-service kind of driven model versus a versus a sales assistant model, you know, salespeople have big personalities and they, they tend to, uh, they tend to affect the culture quite a bit. And it sounds like you, you have a little bit of all of that. Um, I've got to imagine that it's, it's been an interesting transition culture wise to, to, to have a, uh, have a company that, that, um, has all those pieces fit together. Speaker 2 00:34:59 Yeah. And look like if I put my CEO hat on, right. We've been talking about product mostly, but like the CEO hat on it is the role of bringing people together and making sure that everybody understands the needs of the different customer segments. And I always, and I, I like my background is like, I go to my masters in computer science and then I went to business school and I always kind of like was balancing between the, the, the technology and the business world. And I always, and I spent intention a lot of focus on explaining to both of these sides, how important they are. And then the revenue we talk about revenue. And obviously we had all hands and then the R and D teams would say, we talk about revenue and you know, like, why are we talking about revenue? Is the sale? Speaker 2 00:35:46 Is it going to change? The culture of the company was like, look, revenue is an indicator of the product market fit and PR and go to market fit. Like think of it as a metric that is telling you whether what we're building is the right thing. It's like, use it as a KPI, right? It's not like it's not all about revenue. Like we are. The reason why we exist is to help create a world where every product is extraordinary and exceptional, and then how you're doing, like the revenue is an indicator that you can use to measure performance. You can benchmark yourself and, you know, then helps you guide, you see where you have fit the different segments, and that helps guide your product strategy and investments. So that, you know, if you like twist the conversation a little bit, it's not about making money. It is about solving the problem. And the revenue is an indicator of how successful you are doing that. Speaker 1 00:36:39 Right. So it sounds like just, just re re-centering on that mission that you just talked about is the one thing that hopefully gets, gets all these disparate parts of the business focus on the same thing. And, um, and that clearly, obviously the I'm sure anyone who complains about a revenue focus still really appreciates their paycheck. So it becomes pretty hard to check without revenue. Speaker 2 00:37:05 Yeah. And money talks, right. If somebody wants to pay you a couple of hundred thousand dollars a year for a product, like they probably have a big pain point that they're trying to solve. Yeah. And so that's, that's a proof point. That doesn't mean that you're going to go, and you are going to build custom features for large companies, you know, and you're going to get into custom software building business. You still need to think about, uh, the broader market. And does, does the request represent its broader set of needs for, you know, for a broader set of customers. So that there's just good product strategy and good, good, correct thinking, but it's not either, or Speaker 1 00:37:43 Right, right. It's, it's, it's all the components of a healthy business. Um, so you, you talked about revenue is, is a KPI that lets you know, that your, that everything that you're doing, you're, you're, you're hopefully doing well and it's at least sustainable. If you've got enough revenue coming in to, to, to keep that runway nice and long. Um, but do you have, uh, do you have something that's more of a qualitative metric that's more aligned with the mission that you talked about? You know, a lot of times we talk about that as like a North star metric that maybe is a little more, um, emotionally compelling for the, for the team to align around as a success metric. Speaker 2 00:38:17 Yeah. So it looked like, you know, revenue or churn the, the, the flip side of it, right? That's, that's the, it's like trailing indicators, lagging lagging indicators. Uh, we track engagement on the product side. We track, you know, insights created on the platform and features created that indicate that, that the core engagement, because again, product board connects the insights and helps teams understand the needs of the customer and then make sure that it's tied and reflected in the roadmap. And so that link is what we look at. Uh, we, we look at <inaudible> analysis and, you know, you look at all the active, active users and we listed the different, the different kind of core jobs or the core needs that we started Pfizer product. Like there there's, you know, subsequent metrics, like for example, for roadmap sharing, we look at how often and how actively the roadmaps are shared and, and visited by the other parts of the company and so on. So there's a whole set of metrics, but the core is really, you know, the features, uh, supported by insights. It's kind of like that connection is, is critical for us. Okay. Speaker 1 00:39:25 No, that's, that's, I think it's one of those things that w you know, the more metrics that there are, obviously it it's, um, it's, it's, it's hard to gauge project progress, especially if some of them are going up and some are going down. And so I, I know that Facebook and Slack have used something like a daily active user metric as sort of a, a singular metric that supported by a lot of other sub metrics. But, um, it, uh, you know, I got, I got a couple of those as you were talking, whether it's active users or, or insights. Um, but that's something that, um, has kind of aligned with that mission can, can be helpful in keeping the, the broader team aligned over time as, uh, as it gets more complex and fragmented. Um, so, but, but kind of stepping back to the, to the customer part, because obviously that's the part that, that powers this whole thing. Speaker 1 00:40:15 Um, why don't, why don't we kind of wrap up with the, with the journey of, you know, how, how to most customers discover the product today, and then, and then, you know, what's the, what's the point at which it sticks in an organization? Can it stick in an organization with a single user using it, or does it, does it usually need, um, that the kind of collaborative features that you said you've added over time and, um, and just sort of what's, what's a path from, from that discovery to becoming a raving fan and an organization that looks like there'll be a long-term customer. Speaker 2 00:40:45 Yeah. And it is, you know, there, there there's, there's like one single path, like we are seeing really two motions. One is the land and expand where the individual teams or individual project managers are looking for a solution to help them prioritize the roadmap. You know, maybe it starts there and is like, Hey, I, you know, I, um, I've been maintaining these spreadsheets or the PowerPoint tags with road maps, and they, the moment I shared them, they go stale and it's just difficult and cumbersome, and is there something better? And then they discover us and they realize that the roadmap and, you know, the, the, like, sharing the roadmap is great, but that, it's just one small part of being a product manager that, because the more important part is what should be in there, on the roadmap in the first place, and then discover, Oh, wow. Speaker 2 00:41:32 Like I can the roadmap by all these insights and I can tie the, the, the customer feedback. And then it grows from there in terms of the use cases, right? Like suddenly it becomes a real system that helps with the decision making and then helps justify what is on the roadmap. Why are, why, why did we prioritize something? Or why did we deprioritize something? So that's, that's, that's one, the, the, the top-down, the top-down use case is more when you're a chief product officer, a VP product, and people have 10, 2000 product teams, and they're trying to make sense of who's working on what are we aligned, uh, you know, are we organized, uh, maybe we have some high level objectives defined as a company, but once our confidence level that we are actually prioritizing the right, uh, the right task for the right activities, right? Speaker 2 00:42:23 Like th the, the, the right problems to solve or features to build, um, give them what the market's telling us. And right now there's very little visibility, different teams do it in different tools and spreadsheets, again, you know, PowerPoint presentations, somebody that can get in JIRA. And so there, they need a system that kind of provides the centralized, um, rigorous approach to how you make product decisions and how you get everybody focused on the right things. And that's our product boards come in place because the gyrus of the world, again, there is no entity of the customer. It's not like you can see what's relevant to the VIP customers. It's really important. What's important to the customers and specific button, you know, like that customer century center, you've got some segmentation legs there, and it's also usually very low level of granularity stories, dif different, small tasks, why the company needs a higher level view. These are objectives. These are the initiatives. This is the big, big investments that we're making. Speaker 1 00:43:22 It seems, it seems like, like content would probably be somewhat helpful for, for both of what you just covered there in terms of, in terms of like the thought leadership to, to onboard people through, uh, a known need. Is that, is that what, Speaker 2 00:43:37 Yeah. I keep forgetting. This is a growth growth podcast. Yeah. It's content it's education, but the different value proposition is clear about the segmentation criteria and clear about, okay, what is it that chief growth officer at a company like zoom needs versus what does an individual project manager at a small company, you know, needs different pain points. And it's not just the needs around the feature functionality. It's emotional needs, it's the need for recognition and building trust and collaboration and how respected I want to be. Um, you know, how, what kind of delight they expect from, from the product, right. So all of that differs. And so we do, we invest into community. We invest into, um, kind of the best practices and sharing that. We organize a big product management virtual summit, couple of weeks ago, where we had, uh, tamari Hersha from Slack and Shauna Wolverton from Zendesk, you know, like the, the really successful and, and, uh, and kind of product leaders, you know, in, in the, in the space to share the best practices. Speaker 2 00:44:40 And so that's, you know, it takes time, but, but it really pays off. And then just, what do you stand for? It's not about the product. It's like, we are part of this tribe and we want others to make excellent products. And you'll probably the board happens to be a solution to space. We hope that you choose it and that you appreciate how we build it. Uh, but it's not the main point. It's much more about helping each other make excellent products. And we are genuine like that. I mean, that's why I started the company and I hope that it comes across, you know, that it's not this very salesy kind of, you know, pushy approach, Speaker 1 00:45:14 Right. Something that often would lead to shelf where that, that then leads to churn. But, um, so do you, are you finding if you've been around long enough that you're finding that, um, people use it in one company and then they ended up getting hired at a different company and they're bringing it to the, to the new company with themselves? Speaker 2 00:45:31 Yeah, totally funny. Just earlier today, we were looking at some people are in community and there's people who are kind of like the Seattle startup people, or there's a person who at his seventh startup. I mean, you know, doesn't show two very successful streak building a company, but keeps bringing it with, with, uh, with him and even, even, um, and that's more interesting for us as a kind of from business perspective, right? The people startups get acquired or people, uh, join later larger company. And then we, yeah, yeah. We, we get customers through there. Speaker 1 00:46:12 Maybe, maybe it could be like me where I, uh, where I purposely was working six month contracts for a long time. So at that lots of startup jumping around doesn't necessarily mean that you're failing in each one it's like that you, you, of you take them through a stage. And that, that sounds like the type of person that could help, help seed a product board into a lot of companies. Speaker 2 00:46:30 Totally, totally. And if you're a consultant, if you're an advisor, it totally makes sense. Speaker 1 00:46:35 Yeah. And, and so what, um, yeah, just to, to wrap up, if you, if you kind of started, obviously you started with the journey, you talked about, uh, Berkeley, uh, MBA and being in Steve blank course. So you, you you'd, you'd obviously come in with a lot of, uh, a lot of insights on, on growth and, and the, the role that product plays and growth, but what, what do you feel like now that you've been in the trenches as a founder CEO through the years with this business, that you understand about growth that maybe you didn't understand in the beginning? Speaker 2 00:47:08 Um, I mean, one thing that I would mention in this kind of like B2B B2B enterprise space is, uh, you know, sometimes as a, as a product founder or as a kind of like a, you know, more technical background person, you don't appreciate the personal relationships and especially early on it, you know, I look at it, you know, th this might sound funny, but like for a little startup people, we were launching product board around the time when my first son was born and we got 15, 20 early customers just because I was reaching out to people and like, Hey, we want to try prereq boards, this management system, and nobody was responding. And then I sent them, Hey, I know I had these conversations. My kid was just born I'll, uh, you know, I'll, I'll, I'll, I'll be out a little bit. Then he was like, Oh my God, that's so exciting. I'm going to give it a try. Congrats are in you that dude, Speaker 1 00:48:03 I said money there, there was an office episode where, uh, where Jim and Pam were using their kid to make sales. So Speaker 2 00:48:11 Yeah, but it worked, it was awesome. And people would read sending me photos of their kids. And it's just like, you know, so anyway, um, you know, it's, it's, it's, it's, it's more of a joke, but the personal aspect that within the early days just approach it. Like people appreciate it. You're a human being. And that you talk about things that are not just product related. That is like, Hey, this is life. And we were in this together and I need help. And so that, that, uh, that was valuable. Speaker 1 00:48:37 And it sounds like the, you know, the, uh, the old Paul Graham article, if lots of people are familiar with it at this point, but they do things that don't scale. It's just that, that hustle and grind and, and the more interactions you have, the more you figure out what, what people are really needing and, and ultimately how to, how to build a growth engine around it. Speaker 2 00:48:56 Yeah. And then to your point, I mean, you know, again, growth hacking, you coined that, right. And like, you're an expert in this. Um, but the approach and the mindset of researching it and testing different messaging and thinking about the, the segments or with the criteria, what are the defining characteristics of the audience that's still like, so fascinating to me and applying the market research techniques and thinking not just about demographics, but the behavioral characteristics. Right. And then how do you, how do you go about, um, like, you know, learning about the needs of, of, of the audience beyond what you can get as an enrichment from Clearbit and how do you qualification through the sales conversations? It's just fascinating to me. And I still feel like we've got so much learning to do. And then just as an industry, you know, shared that knowledge and shared it, understanding of the customer segmentation with the broader company. Speaker 2 00:49:52 Um, it's, I know that this is, you know, it's, it's, it might not be coming as clear of a message, but it's, it's because, like, I see so many companies struggle with that. If your ideal customer profile, like you get a very high level responses, you know, most of the time. And I just want to highlight that, that, you know, we need to talk more about product strategy and segmentation and how you think about the incremental approach and how narrow you describe the segments and the target customers and, and the adjacency of use cases, and that you understand how your target audiences in terms of personas. And then if you build for too many personas, the messaging gets thrown into the mix, and it's more complicated. Whereas if you focused on one, uh, anyway, I, I know it's complex, but just let's talk more about that. Speaker 1 00:50:45 But that's definitely one of my key takeaways as, as you've been talking is just, uh, is, is, you know, focusing on a, on a narrow part of the market. And, and, um, you know, it sounds like you've everything from, what does the product look like that that needs to serve that market to what does the organization look like that, that, uh, attracts and converts and retains that part of the market. And then over time, as you've, as you've built the business and attracted more resources, you can, you can go more broadly and, and think about those adjacencies and how do we expand into the other parts of the market? Because I think that the, uh, the biggest thing is that you, you know, most new businesses fail. And especially when it's a new category, if one, once you've validated it, it's only a matter of time before lots of others come flocking into that space. And the more you can take Slack out of the market, the more likely that it'll be hard for someone else to gain traction and become a formidable competitor, too. Speaker 2 00:51:42 Yeah, absolutely. It's it's, I mean, yeah, to this point, it's just like how you stay focused and how you strategically defend yourself, do most you bill. And the other thing that was really interesting is that I went, and I dove really deep into the history of like, how did we end up with lean startup? And, uh, before that, you know how agile happened. And, and I ended up reading the theoretical papers on house of quality from Japan in the eighties. And, and it's just like, you know, the history comes back and it repeats itself. It's the same, like the market segmentation and the thinking has been around for a long time. It has been taught in marketing strategy classes before product management, the digital product management existed. You know, we talked about brand manager right at this fast moving consumer good companies. And so it was just like the idea that you're learning, you're reading a book that's from the eighties and, you know, it's, um, marketing strategy and it's so relevant to what we're doing today that was also is like, okay, yeah, tried and proven. We need to apply it to a new era. And the digital fast moving space for the concept stayed the same. Right. Speaker 1 00:52:49 I've always kind of thought it's, it's almost like physics where there's a, uh, you know, a set of governing principles. And, and we, we come up with different theories and tactics of how to, how to navigate within them, but the, but the overall kind of framework and physics that we're trying to operate in, don't, don't really change that much over time. And it's, we're just trying to get smarter about how to, how to maximize opportunities within them. But, uh, that's a, that's a conversation for another time, but I really appreciate Hubert you opening up and just sharing the story of product board and, and the journey from, you know, those early days to where you guys are. I'll be really excited to watch where you, where you take it from here, because it seems like you're really onto a, a huge opportunity and one where you've got, uh, passionate customers that will help power you into the next phases. Thank you, Sean. I really appreciate talking to it was awesome. Thank you. Great. Well to everybody listening, thanks for tuning in, and we'll do it Speaker 0 00:53:47 Another one next week. Thanks for listening to the breakout growth podcast. Please take a moment to leave us a review on your favorite podcast platform and while you're at it subscribe. So you never miss a show until next week.

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