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Our world was different in the year 2000. Everyone recovered after the Y2K freakout. Only 41% of all Americans had the Internet, thanks to free CDs from AOL. So I interviewed Sam Saltis to learn how he started his web dev agency during this time, which he later turned into an 8-figure SaaS.
Everyone recovered after the Y2K freakout. Only 41% of all American homes had access to the Internet, thanks to free CDs from AOL. People went to Ask Jeeves to get MapQuest directions to the nearest RadioShack.
Best of all, the new millennium felt like a step into a new era.
For Sam Saltis, his journey into the world of SaaS had just begun. His humble beginnings began with a web development and design agency, bwired.
Creating a Tool as a Competitive AdvantageBack in 2000, building an e-commerce website was expensive. Remember, this is before the days of Shopify, BigCommerce, and Magento. To increase profits, Saltis and his team began creating a tool to create websites faster.
“Most companies want to manage and own everything [on their website]. So we built one platform to make our agency more efficient. It was also a competitive advantage.”
Because bwired was signing up new clients, getting their first 25 customers for their new tool Core dna was simple. As clients came on, they sold them on the tool.
But scaling beyond their own customers was another challenge. One which Saltis was willing to travel over 10,000 miles to solve.
Why Sam Saltis Traveled Over 10,500 Miles to Know His Customers IntimatelyAlthough Saltis’s agency was in Australia, he wanted to launch in the US. First, Saltis hired a consulting company.
“[Through the company], we found out what customers were looking for. We did a branding exercise to decide on the name, what our business stood for, and created a new logo around that promise.”
But getting the branding and messaging right for Core dna wasn’t enough for Saltis. He wanted to live and experience a day-and-the-life of his customers. To feel their pains, to know their dreams, and embrace their culture. So Saltis came to the United States and considered five cities for his new home.
“I travelled around the US for a month. During that time I asked myself a few questions. Is there a real business in this market? Is there access to capital? To qualified people? Is it a good place to live for me and my family? After my trip, I found out that Boston was the best fit.”
After moving his family to Boston, Saltis began diving deep into learning more about his core customers. He explains how moving to the US transformed his thinking.
“Coming from 24 million people in Australia, [I felt like] you have to be all things to all people. Once I came to the US, I could become more focused and helped me change my mindset. This allowed me to hyper specialize. We now focus mainly on B2B ecommerce for manufacturers, but we’re still in the CMS space.”
What to Know About Your Customers to Build a Lovable Product.After extensive research on customer needs, Core dna created six customer personas. This helped them know how best to market to each type of customer.
“We started creating content on each persona. At first we didn’t understand their buyer process. As we learned how they came to us, we began to map out the journey.”
Creating profitable personas is simple, though often done wrong. After talking to your customers, you will ask questions about themselves. You might have questions like:
- What is your age, gender, location, job title and industry, and favorite hobbies and interests?
- What are the challenges and problems you face?
- What is the outcome you want from using my product? Or my favorite way to ask this question, "What's preventing you from loving this product?"
- What is your dream outcome after using this product?
- What objections and questions do you have to buy our product?
- What solutions have you used in the past?
Core dna uses anti-personas and competitor personas to keep their product lovable.
“Many people come into our system who aren’t in the right country, don’t have enough funding, or who are not the right fit. These are our anti-personas.
“We lay out the value and costs of our software, but we show the return will not be there to use our tool successfully. It’s a waste of their time and better to use a competitor.”
While anti-personas are rare among startups, I’ve come across a handful of companies who use them. In my interview with Steli Efti, Efti mentioned how anti-personas reduce product bloat and increase focus.
Even more rare are startups using competitor personas. Most startups ignore their competition. But there are some useful strategies when competitors come to your website.
“We use competitor persona to test content, recruit employees, and even send competitors a message. When we were looking to hire salespeople, we wrote an article about open-ended sales questions. We then reached out to some of these people to see if they wanted a job.”
Knowing The “Right Time” to LaunchIf you ask 100 entrepreneurs when is the right time to launch, you’ll get 100 different answers.
Launch too soon and your product won’t get any traction. Launch too late and you’ll miss valuable lessons which come from experience.
Here is Saltis’s take:
“The product is never ready to launch because we’re always adding new features… We launched the product, find a new customer, and then meet their needs. As you grow into the market, you discover new things you lack and you move quickly to solve their problems.”
Favoring Systems Over Big BangsNot all product launches are of the quality and caliber of Apple. Most products fail.
- 72% of new products introduced in 2009 to 2014 failed to meet their revenue goals or failed entirely (Simon-Kucher & Partners).
- In 2010, the rate of product failure cost U.S. companies $260 billion (The University of Texas at Austin).
- And roughly 75% of venture capital-funded startups launched from 2004 to 2010 failed (Harvard Business School).
“[Our market] is a big market and very noisy. People don’t have the patience to listen.”
The Core dna team explored doing ad campaigns, but the cost was too high.
“Our competitors were spending millions of dollars and we could not compete with what they were doing.”
So the team pivoted into building content, focusing on this channel long-term.
“We’re writing information about our new features and focusing on a drip system over a big bang launch. We’ve also began to build relationships through our content. When a potential customer needs us, they reach out and we’re ready to talk.”
Building a Go-to-Market StrategyMarketing is a constant quest to find how to better serve your customers. You never know what channels and messaging might make you millions. Or break the bank if you’re not careful.
Saltis admits even with their current success, they still make errors as they test out marketing at events.
“We network with a lot of people by going to seminars and events. We’ve tried various e-commerce events. The return on those have been hits-or-miss for us. \ \ “We still get [what events to attend] wrong. You’re in the heart of an event, buying and connecting with attendees, but nothing happens. A lot of people come to these events do the research to see if what you offer fits their needs best. So you need to understand the customers needs better than they do. Then sell them on that.”
When testing customer acquisition channels, my recommendation is this:
- Brainstorm marketing channels. Write down every possible way you can get new customers, both online and in-person. Optimize for the most ideas. Don’t worry about your odds of success at this stage.
- Prioritize. Score each channel on a scale of 1-5 in three categories: Impact, Confidence, and Ease. Impact is the impact if the campaign is successful. Confidence is how confident you are the test will be a success. And ease is the channel which takes the least time and money to invest for the campaign to be a success.
- Rank and execute. Starting with the highest scoring channel, invest up to three months and up to $1,000 to see if the channel will get you new customers. It’s okay if the channel isn’t profitable in three months. What you want to see is enough results to know it’s worth investing in another three months and $1,000.
Overcoming Imposter SyndromeDo you feel like a fraud?
It’s common for entrepreneurs to doubt their accomplishments. Some have a persistent fear someone will expose them.
From my observation, a lot of this stems from unmet expectations. One entrepreneur feels they need a livable income to feel “legitimate.” While another still feels insecure until she hits $10 million in recurring revenue.
I asked Saltis about his perspective on this topic.
“I don’t know if Core dna has ever been a legitimate company, ha! We generate enough revenue to employee 40 people. People are paying for our product. But as a founder of the business, what is legitimate? That we’ve scaled?
“We’ve started to get a lot of traction in the last three years. But I feel until a business gets more than $5 to 10 million in annual recurring revenue, they’re not legitimate.”
Sam Saltis’s Final Advice in Getting Your First 1,000 CustomersIf you’ve heard me say it once, you’ve heard me say it 1,000 times. Successful businesses start by talking to their customers.
There are very few entrepreneurs which are successful without doing customer research. Saltis agrees.
“Through my experiences, you’ve got to get out there and talk to your customers. A lot of product people don’t talk to customers. If you can genuinely mean it, tell each customer you think they’re a great fit for your product and want to build it around their needs. Ideally, get a customer before you build something.”
Saltis began to give some rapid-fire advice...
“Don't be afraid to fail. Your data is not always perfect. Accept it.”
“Don't get caught up in shiny objects. It’s easy to get distracted by what’s on the left or right, but you need to stay the course.”
“There are a lot of hats in play as an owner. You need to separate the owner hat from the director’s hat and the employee hat.”
“If you’re thinking about an investor, think about what they want. I’ve seen people make business decisions thinking what would benefit employee rather than an investor. You need to treat each person you work with differently.”
“To get to product-market fit, you have to say ‘no’ to people willing to pay you cash. The textbooks will tell you one thing. But you’re dealing with people.”
“People avoid the hard stuff. They have a technology that works okay. But it’s hard to pick up the phone and talk to everyone, but you need to. A developer doesn’t know how to sell, and doesn’t want to do it. So if that’s you, you need to get the right people around you to fill in the gaps.”
Special thank you to Dennis for making this interview possible. For my other article with Sam Saltis, you can find both posts here. And for more articles like this, click here to check out our 1,000 True Fans series.
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