Omer (00:11.520)
Welcome to another episode of the SaaS Podcast.
I'm your host, Omer Khan and this is the show where I interview proven founders and industry experts who share their strategies and insights to help you build, launch and grow your SaaS business.
This week's episode is a story about three guys who started a small consulting company in 2006.
They were building websites for their clients and on the side they were building small products for fun and hopefully profit.
One of these products, a tool to manage your RSS feeds, got a little traction.
It grew to over 200,000 users, but it was free and made no money.
But it did generate a lot of support and feature requests.
And the founders quickly realized that trying to use a shared Gmail inbox for support didn't really work too well.
They needed a help desk solution, but they couldn't find exactly what they were looking for.
And this wasn't an overnight thing.
My guest spent about two years on this problem.
He spent time thinking about the ideal solution and he tried out a number of different support tools.
During that time, he realized that what he wanted was a help desk that didn't feel like a help desk.
He wanted people to be able to send an email and get a reply without the need for a support portal, ticket, numbers and so on.
And that's how the idea for their business was born.
Today they have a multimillion dollar business.
They have over 8,000 business customers in 140 countries and they've raised just under $13 million in VC funding.
But for the first four years of their business, they survived on a seed round of a few hundred thousand dollars.
They put a lot of focus into becoming self funded and building an efficient business.
And when they did raise money, it was the rocket fuel that they needed to help them grow faster.
There are a lot of great lessons and I hope you enjoy this interview.
Today's guest is the co founder and CEO of HelpScout and a simple help desk product designed for small and medium sized businesses.
Help Scout was founded in April 2011 and now powers over 8,000 support teams in over 140 countries.
Its customers include companies such as Basecamp, Trello and Grubhub, to name a few.
HelpScout has raised just under $13 million in funding.
The company has offices in Boston and Boulder, Colorado, but most of its employees work remotely in 40C cities across the world.
So today I'd like to welcome Nick Francis.
Nick, welcome to the show.
Nick Francis (02:58.670)
Pleasure to be with you.
Omer.
Omer (03:00.510)
Oh, I'm really glad that we're finally getting a Chance to talk here.
You know, I've been aware of Help Scout and what you guys have been doing for a little while.
Maybe not as intimate with the product as I like to be, and I'm sure I'll be a lot better educated about it by the end of this conversation.
But let's start by talking a little bit about you.
So what, what gets you out of bed?
What motivates you to work on this business every day?
Nick Francis (03:23.720)
Well, my goal in life is to make great stuff.
It's very simple.
I'm a product person and I love to make products that make a difference for somebody, create an experience that they wouldn't have otherwise had.
I live and breathe building great products.
And so everything I've done in my career has really set up this opportunity, which is Help Scout just to make a product that not only helps people, but empowers business to provide a great experience for their customers.
So for me, it kind of checks all the boxes.
It's something I'm super passionate about and energized by on a daily basis.
Just seeing the kind of impact we can have, not only building a product for people, but providing educational resources and really feeling like we have a say in how companies work today and how they become more customer centric.
So it's all very exciting and I have no problem getting up in the morning, that's for sure.
Omer (04:28.650)
What's your background?
What were you doing before you started Help Scout?
Nick Francis (04:32.970)
So I've sort of been a career entrepreneur.
I've started companies since I was quite young.
I won't count the lemonade stand and the homemade art that I used to sell as a.
As a small child.
But I started my first business in high school, pretty much put myself through college with other businesses and really fell in love with the web as it was coming of age and was always a geek.
My parents get all the credit in the world, providing me my first Mac when I was in fifth grade, which was a big deal back then.
I'm actually older, so it was a really formative experience.
And I started building websites pretty much as soon as I could, as soon as I was able and kind of went from there.
And I was super inspired by a lot of other companies like Basecamp.
We mentioned them already as a customer, so it's gone full circle.
But companies like that that were building really unbelievable products and just kind of the values that they held and still do hold are values that resonate with me.
And so there are a lot of really great companies out there making great products and I just wanted to be part of it.
I wanted to work on things like that.
I felt like it would give me a lot of fulfillment in life.
And I just so happened to find two co founders that are wonderful at their craft.
And so it worked out pretty well that we could build things together.
Omer (05:59.810)
So I gave the audience a quick overview of Help Scout, but it would be great if you could tell us a little bit more about the product in your own words, like, what is Help Scout and what is the problem that you guys are trying to solve with that?
Nick Francis (06:16.350)
Yeah, the much bigger thing we're trying to solve for is that we want to be your business's communications hub.
Everywhere you talk to a customer, one to one, we want to be the place where that conversation happens, is stored, is reported on.
So basically, we become a business's de facto CRM.
When you're looking at a conversation from a customer in Help Scout, we pull up all the previous conversations you've ever had with them, all sorts of other information from outside apps, whether it's Salesforce, Shopify, mailchimp, whatever.
We pull all of the information you need to know about the customer, your relationship with that customer, and what you've talked about in the past.
It's right in front of you so that you can provide that personalized level experience at tremendous scale.
So whether you've got five people on your team or 500, we've built a system that's, that's able to scale to meet whatever needs your team has and can really give that personalized experience.
So while you might say it, we do make a help desk, quote unquote.
It's not your typical help desk in that there's no ticket numbers, there's no robotic looking emails.
Everything you get back from Help Scout is personalized.
The customer never even knows that they're interacting with a system.
They only know that they're interacting with a person, which is what we really try to underscore with the technology.
I think recently we looked it up and we've Help Scout has interacted with roughly 8% of the U.S. population.
Omer (07:49.440)
Wow.
Nick Francis (07:49.840)
But most of those people have no idea because Help Scout's completely invisible to the customer.
We think the best, most effective help desk is one that's invisible and one that puts the company and the relationship first.
Omer (08:02.840)
So in many ways you're trying to or you have created almost a new product category.
But if you don't call it a help desk, then will people really understand what it is?
Nick Francis (08:14.600)
That's a great insight, Omer and I Wish I had you around six and a half years ago.
Because when we started Help Scout, we insisted even on the homepage that it was not a help desk.
Because to me, a help desk sounds like a really enterprise level system that's meant to deflect as much customer support and as many customer issues as possible.
And that's the antithesis of what we really wanted to build.
We just wanted to create a scalable way for many people to share an inbox to provide any form of customer service.
So it may not even have to be a support issue.
Like, there are teams throughout organizations that will use Help Scout for all sorts of other different things, really more as a shared inbox, a way to collaborate on customer communications.
So that's why I say a customer communications hub, because we find that support teams in an organization will pick up Help Scout and start using it, and then other teams throughout the organization will also start using it for different shared inboxes.
And then it becomes sort of the de facto place where all the conversations with your customers are stored.
And so we have really great reporting on all of that and great open APIs where you can take that data and do what you want with it.
Omer (09:27.430)
Okay, I'd like to go back to the start of this story and how you came up with the idea for Help Scout and what you and your co founders did to turn that idea into a product and a business.
So, you know, you launched in 2011, so sometime before then you guys came up with the idea for this product.
So how did that come about?
Nick Francis (09:56.110)
Yeah, so it came about.
I mentioned I've kind of been a lifelong entrepreneur.
I learn at the highest velocity when I'm starting something new, and I'm just kind of learning through experience.
And so when I wanted to learn how to make products and I wanted to learn how to build things for the web, I started a company that built websites and web apps, did all sorts of user experience work, and that's how I met my co founders.
So 2006, I started a little consulting company with those two guys and we built products.
We built websites for small businesses, e commerce operations, all sorts of stuff across the board.
And for five years we refined our craft and on the side we would build little products.
So we built this one product called Feed My Inbox.
It was a really simple way to subscribe to any RSS feed over email because we thought RSS feeds were kind of geeky.
Most people don't really know what they are.
They just want to subscribe to a website and get emails Whenever there's new content.
And so we created that website and it went really well.
It was free, it didn't make very much money, even in the end when we were charging a little bit of money for it.
But we had over 200,000 active users.
We had to learn how to build a service at some level of scale and deal with some of those challenges.
And not only that, but we also had to do customer support.
We had quite a bit of people emailing in every day with questions, feedback, feature requests, and sharing a Gmail inbox didn't get us very far.
We were kind of stepping all over each other's toes.
And I spent about two years thinking about this, just looking at different support tools.
I wasted a few Saturdays trying to implement support tools and basically just turn off everything.
I just wanted the inbox portion.
I didn't want the customer experience to be a downgrade if I adopted a help desk.
That's why I didn't like the term help desk, because I felt like the customer experience actually got worse if I adopted one.
So I was just like, you know what, if we built a customer service tool that was designed for a great customer experience first, that's all that mattered, was a great customer experience.
And then we work our way back and build some of those scalability functions and features.
I think we could do that.
It would just take a radically different approach than what everybody else is doing, essentially.
Long story short, that's what we ended up doing.
I felt like, yes, it's a market with a lot of different products, but we're going to take a completely different approach to this.
The help desk is completely invisible.
There's no portal, there's no ticket numbers.
It just feels like a personal email, just like from Gmail, but yet it provides so much enterprise level scale on the back end for our team to collaborate.
So that was kind of the initial idea.
And because we were solving our own problem, we were able to pretty much nail it right off the bat.
It didn't require a ton of research because I felt like I was pretty intimate with the problem and the pain we were trying to solve.
Omer (12:57.280)
So it sounds like there were two parts to this.
One was the backend functionality of what is in Help Scout today.
And almost this sort of CRM customer intelligence type information, which allows anybody on a support team to be able to do a better job in serving that customer because they have a much better view of the customer's history, their needs, whatever else information that you have in there.
But then the other part of this was the customer experience.
And it sounds like that was the first thing that was driving you, presumably because you'd been interacting with people on a one to one basis through Gmail.
And I think especially in the early days of a business, there's something really powerful about having that personal direct engagement with customers, both in terms of being able to learn from them about what their needs are, how to build a better product, but also in terms of really building those relationships with those people who have really put their faith in you early on.
And I've done this as well.
And I've seen when you move to a help desk system, it kind of takes that away.
The experience doesn't seem as personal anymore from a customer perspective.
You almost feel like there's now a barrier between me and the people in this company.
And it may be there for a good reason to try and organize this information and follow up with tickets and numbers and all of that stuff.
But it does feel like it adds a hurdle between this direct flow of communication between the company and the customer.
And was that the primary reason that you were kind of driven by doing this?
Nick Francis (14:46.040)
100%.
You said it very well.
It sort of puts a system in between you and the customer.
And we live in a day and age where the customer expects to be able to have a one to one conversation with a major brand and for that major brand to react in a very human and personal way.
That's the world in which we live in.
So as a business, if your goal is to be about customers, to have a customer centric culture and set of values, you can't put a system between you and the customer.
You just can't.
It's not okay.
And it wouldn't be aligned with your values.
So that's what I was running up against.
I just refused to use some of these other systems because I felt like it wasn't the experience I wanted to create.
Omer (15:31.470)
Yeah, there was something that I saw on your website which said that Helps Scout was for businesses who make excellent customer service a priority.
And when I first read that, it was hard for me to really get what that meant because it's just, you know, five or six words.
Right.
But now I think what you're saying to me makes a huge amount of sense in terms of you don't want those barriers in place, you don't even want people to know there's a help desk system.
You almost want it to feel like people are having, as you said, the one to one communication.
They're just emailing somebody and getting an Email response back.
But you're doing it at scale.
And I think that's where this idea of this excellent customer service comes from.
Nick Francis (16:23.680)
Right?
Yeah.
And I wrote that statement.
I know the one that you're talking about.
And the reason I wrote that is because we want somebody to read that and just put their fist up in the air and say, yes, or we want them to say, oh, I don't really care.
So I know that this system isn't for me, and they leave.
I would love for that to happen, frankly.
We only want customer centric businesses using Help Scout because we design the product for those people.
Those are our people.
And I do believe the sign decisions you make, the way that you create the product, the experience that you're building does, like, you need to share values with the people that are using it on a daily basis and in order for them to get maximum value.
And so we're really just trying to focus on our people, the people that align with the values we have about how customer service should work and kind of disqualify the rest of them.
Omer (17:20.080)
Yeah, that's great.
So you mentioned that you spent about two years thinking about the product and what that experience should look like, and that you also played around with other help desk tools and software along the way.
When you guys decided that you were going to build something, did you think of it as, we're getting ready to launch a new business, or was it, let's build another tool?
Like, was it Feed my box?
Nick Francis (17:56.760)
Feed my inbox?
Yeah, feed my inbox.
Omer (17:58.520)
So was, was it kind of like another tool like that, or did you guys decide pretty early on that you were setting out to build a standalone business?
Nick Francis (18:09.780)
I was ready to move all the chips to the middle of the table.
I had done the client work for five years.
Frankly, I wasn't amazing at it.
We had learned our craft, which was the goal was to become really good at the craft.
But working with clients is not fulfilling for me because in the end, I didn't own what I was producing and I didn't feel like I could make it as great as it should have been.
The day you launch something is the best day that that work ever sees.
And it's all downhill from there.
So I didn't find it to be.
It didn't juice me.
So I was ready to move all the chips to the middle of the table and say, guys, I want to go all in and create this business.
I know the market is there, I know the opportunity is there.
We have the pain point.
We know exactly how we want to solve it.
Let's go in.
And so we spent six months, just kind of pooled all of our money together, six months fully focused on building Help Scout and trying to get it to the point where we could launch a first product.
Omer (19:17.160)
How big was the team behind sort of building that first product?
Nick Francis (19:22.070)
It was the three co founders.
So I had been working with these two guys at the time for five and a half years and we built it together and we complement each other perfectly in terms of building and designing products.
And so we had all the expertise we needed to create the product soup to nuts and we were able to do that.
Omer (19:44.150)
So one of the things that, you know, sometimes people ask me is like, I probably should spend more time on this, but I really do.
My bad.
But in terms of like the tech stack and the technology, what did you guys use?
I mean, was this, like, were you using Ruby on Rails?
What did you use to build this product?
Nick Francis (20:04.460)
So the cool thing was that we got to experiment with several different technologies over the years.
We built a product in Rails, we built a product in a framework that was called CakePHP, which was a very different approach, more of a Rails esque approach to PHP as a framework at least.
Then we settled in on PHP and as it was getting more modern, we really liked a lot of pieces of it.
We had already built a really sophisticated kind of billing and plan management engine.
Well before Help Scout, that was in php.
So we said the easiest way for us to get to V1, to get to a launch was, would be to build on this existing system we've already created, which can do authentication, registration, billing and plan management, monthly subscriptions.
It can do all of that stuff already, so let's plug that in.
And so by way of using that system, PHP became the default language that we built everything on top of.
We were AWS from day one, still are today, and use a wide variety of all the services they provide.
And then within two years, Backbone JS really became much more popular.
So on the front end we ended up moving everything to backbone JS in terms of JavaScript and the front end.
But otherwise it's just kind of custom components.
We now use a lot of React.
So it's safe to say we're not dogmatic about any one programming language or framework or way of doing things.
It's all about best tool for the job.
And we continue to evolve that stack as new technology progresses and is introduced.
And so the stack has changed a lot.
We use a lot of Java now, all of our APIs are Java.
We have a product called Docs.
That's not any PHP at all, it's all Java.
We've experimented with all sorts of different things for different reasons.
Omer (22:02.720)
So this is like from 2011.
So is any of your original code still there?
Nick Francis (22:10.320)
I'm sure some of it is, at least the backend, so we call our backend Sumo.
So the part that does all the registration, authentication, billing and plan management, no doubt we've refactored quite a bit of it, but yeah, a lot of it's still there and it still works really well.
Omer (22:27.080)
Okay, so you said six months, you set aside to focus on building the product.
So when it comes time to launch, what was the process you guys went through and how did you go about getting your first 10 customers?
Nick Francis (22:43.390)
I loved the process of working on the product and I felt like we were working on something really special because of that.
I read a book written by David Cohen, who co founded techstars.
It's called Do More Faster.
Really appealed to me on so many levels.
Told the stories of some really incredible companies that had gone through the techstars startup accelerator.
And I just said, this is the next step for us.
I know we're close to launching this product, but we have a heck of a lot to learn about building a business and what it's going to take to make this thing really sustainable in the long term.
And the next day I applied for techstars and we just so happened there was a program going on that we were accepted to in Boston.
We lived in Nashville, Tennessee at the time.
And I hit it off with the woman that was running the program.
Her name is Katie Ray.
And so the business wasn't interesting to them, Katie has later told me, but the fact that I had been working with the same two people, the same two co founders for almost six years and we were quite good at making product together.
That was sort of the kicker.
They said, you know, at least these co founders are going to stick together.
They have a really strong bond.
Maybe the business turns into something completely different, but we're going to make a bet on these, these three people.
So we moved to Boston, we worked on the product for another three months and launched halfway through.
So it was April or maybe, yeah, May or June.
So launched the product and from then learned a ton about building a business, building a software business, building a product is different from building a business.
So we Learned all about SaaS and economics and raising money, which is a very complicated topic.
Learned a ton of were baptized in all sorts of all things startup for three months and at the end of it, did a demo day where they have 500 investors that come and watch you sort of pitch your product for a little while.
We did super well and within a couple of weeks we had kind of raised $800,000 to keep building this thing because, you know, we were running on fumes before we launched the product, before techstars.
And so techstars really did give our business the opportunity to succeed.
I'm not sure if it would have succeeded if it wasn't for the community behind that program and just generally the community in Boston that's been so supportive of the product from day one.
Omer (25:15.110)
And you applied to techstars because of reading the book?
Nick Francis (25:18.870)
I did.
I think David knows that now, but yeah, I read the book in an evening, like, I sat down at 9pm in bed and finished the book at like 3 in the morning and just said, yeah, this is the next step.
It's very clear to me.
And we applied the next day and we're very lucky to, to have met the right folks that just were willing to make a bet on us.
Omer (25:43.560)
So you said they weren't excited about the product at the time.
Was it very different from what we see looking at Help Scout today?
Nick Francis (25:52.930)
It was in that it was really focused on sharing an inbox, so we even had the nerve to call it Gmail for teams at one point, at least in the way that we pitched it to people.
It was just, it was like an email client, but it was built for teams, so you could collaborate, you could add notes, you could assign to different people.
There were statuses and you could easily see previous conversations with people.
So, yeah, it's changed a lot.
It's really changed a lot.
And David Cohen, again, was the one that told us, look, I don't think you have the desire to raise the amount of money it's going to take to educate a completely different market.
Let's face it, you're building a help desk.
Just call it what it is.
It is a help desk.
You have a different approach, that's all good, but call it a help desk.
Do not create a new market just for your little product that's going to require a ton more funding and all this other stuff to make work.
And so that's what we ended up doing.
It turned out to be the right advice at the time.
Omer (26:53.820)
So how did you go about getting customers?
You've got a product, you've gone through Techstars, you've learned a lot about building SaaS business.
You've got funding comes or your seed funding comes pretty quickly after that.
But what about the customers?
How did they come along?
Nick Francis (27:11.830)
Well, that's sort of my expertise is user experience, research and design.
So from very early on, not only were we designing a product for ourselves, which was immensely helpful, we were solving our own pain points.
So a lot of times I could use my gut and get pretty far.
But I was also, throughout the development process, talking to anybody that would be willing to talk about their customer support tool.
And so I. I was not selling.
I was not even talking about our product.
I was just asking a ton of questions about how the support team worked, how they were structured, how many conversations they managed every day, what pain points they had, what they liked, what they didn't like about the product they were using.
It had nothing to do with Help Scout.
I was just researching my ideal customer.
And until I could finish their sentences, I didn't feel like I knew enough.
So I interviewed literally hundreds of entrepreneurs and support professionals and support team managers over the course of probably nine months, just asking a bunch of questions about what their workflow was, not even talking about my product, so that I could just be able to finish their sentences, understand who my ideal customer was, what the opportunity was in the market, and really focus in on that.
And what I discovered, which was pretty much my thesis, is that Help desk tools are really built for enterprise level needs and enterprise level values.
If I'm honest, small businesses differentiate with great support.
That's part of the fabric of their culture and their business.
And that's the product where I didn't feel like there was anything in the market to really serve those people who I would consider my people.
That's who I am.
So I talked to hundreds of them, and that was really the process through which we got to know the product.
And by the end of it, when I would actually say, oh, and we built this help desk, it would totally resonate with exactly what they needed.
And so we were off to the races pretty quickly.
Had several hundred people using the product within a couple months.
Omer (29:19.020)
How did you decide who to focus on?
Who were your target customers at the time?
Nick Francis (29:23.990)
They were just like me, if I'm honest.
I mean, it's so much easier to build a product when you're the ideal customer.
So I was just trying to find more companies like me or like the company I was trying to build that were having some of the same challenges I was.
So it started out very narrow and then broadened based on different things that I learned.
So I learned that in E commerce and online retail, it's a volume game.
So usually the support teams are much smaller.
The businesses themselves are pretty small, but the volume is immense.
So they do a lot more volume in E commerce.
And so I was able to make design decisions and product decisions based on that knowledge and opportunity with online retailers as opposed to software companies who tend to have sort of a different use case.
So learned a ton along the way.
Omer (30:14.800)
So I know that a lot of the, certainly the early growth came from the product and the focus on, on building the product and putting the right features in there.
No, kind of, no matter how small they were for your customers.
Can you talk a little bit about that?
Maybe kind of give us an example of the kind of things that you were doing to really drive home that sort of product focus?
Nick Francis (30:42.400)
I think it was really just about being super responsive to whatever questions they were asking or whatever feedback they had.
So it was really important to me to focus less on building those big features that we knew we were going to need eventually.
But being unbelievably responsive to the customers we did have at the time and the feedback that they were giving us that was.
It wasn't really marketable.
It was just about the customer experience.
And so somebody would say, hey, I really wish there was a keyboard shortcut for this one thing because I find, you know, I'm doing it probably 50 times a day.
I wish there was a way for you guys to add in that as a keyboard shortcut and later that day it would be in the product deployed as a keyboard shortcut.
So we were unbelievably responsive to just those little tiny details.
Because I felt like, man, if we get all of these little tiny details right, I'm going to make a bet that most companies don't respond that way to little feature requests.
And that's going to be my way of differentiating.
We might come up short on some of these big features, but when it comes to the execution of the product and those tiny little details, we're going to be the only ones that execute on them in the right, most consistent way.
Omer (32:00.670)
That's very interesting because I've been a product guy, I've worked in enterprise, let's just say environments.
And that's not the kind of the process that I've seen most teams go through.
I mean, you get a lot of feedback from customers and you end up with a long list of features and bug fixes and whatever.
But inevitably the way that you end up prioritizing this means that, that the features that are going to have the biggest impact for the business, for the largest number of users kind of bubble up to the top.
And those small things that one person asked for, everyone goes, yeah, that would be great, but this other stuff is more important.
Did you have that kind of conflict happening where you were trying to say, okay, let's really figure out what are the most impactful things we could be doing in this product.
Product versus these really small things, which on their own, they might not take up a lot of time.
And a shortcut like that, it's great that you were able to get that done the same day, but if you're trying to do 100 of those things every week, then doesn't it become a distraction?
Nick Francis (33:18.760)
It can, and it's a really tough push pull still to this day, because let's look at the other side of it.
You may not end up working on the big money features.
You may be seen as less innovative in the market because all of the big things that you're working on may take longer because you're taking the time to worry about all the little details of the experience along the way.
So there's certainly compromises you have to make.
But this goes back to my life goal and the reason I get up in the morning.
And it's to make great stuff.
It's not to make a lot of money.
It's not to build the biggest team.
It's not to take a company public.
It's to make a really great product that people love to use.
And for me, that means focusing a little bit more of my time and effort and team's effort on the details, the experience, and making something that people really enjoy using.
And if it means we launch a feature a little bit later or we're a little less innovative, but when we do actually launch that thing and it's executed on in a much better way, then I'm willing to make that trade off.
Because my goal in life is to make the best possible products I can.
Omer (34:33.430)
Yeah, I love that.
I love working with people who have that mindset where it's not just about throwing the kitchen sink at the product and putting everything in there, but it's almost about sometimes how you can take things away which make the product work better.
Nick Francis (34:52.880)
Yeah, you're totally right.
And frankly, it's a lot harder.
I'm in this for a challenge, making a kitchen sink.
Saying yes to everything is frankly, just too easy.
It's not really worth it for me.
Omer (35:07.360)
Okay, I want to talk about content marketing, because I know that was an area that you guys made a big bet in terms of how you were going to grow the business.
Can you tell us a little bit about that?
Like how did that come about and what sort of results has that helped you produce?
Nick Francis (35:22.830)
Yeah, whenever I look at the market, I'm always looking for ways in which we can differentiate and be creative, like any entrepreneur.
And when I look at the customer support and customer service space, I see a bunch of good companies with good products, with a lot of funding and a lot of people and a lot of resources.
So I'm going to be outgunned at every turn.
What is it going to take for my business to differentiate?
And very early on I realized, okay, every way in which we differentiate from a brand standpoint is going to have to be something you can't write a check for.
Because if a check can be written, there's plenty of other people that can write bigger ones than we can.
So that eliminated a lot of different marketing and branding tactics and in the arsenal.
And then I want to do something that's aligned with our brand.
Like I don't want to ever compromise the brand for short term growth or short term gain.
So that eliminates a whole nother set of marketing tactics and sales tactics.
Because I wanted to build something for the long term, I'm not really interested in doing anything else.
So in the end, what seemed to align most with our values, the brand we wanted to build, and us being able to differentiate on a creative basis in a way that you can't just write a check for.
Content marketing was that perfect fit for us.
It's something that takes a lot of work to do very well to build a brand on that sort of thing and to become a thought leader in the space takes a lot of sweat equity and investment.
And we can make people better.
Right?
Like I could actually feel really good because I'm helping people before I ask for anything in return.
This is not self serving.
I'm genuinely trying to be helpful and additive to the community by creating this content.
And as a byproduct of that, maybe you learn about our product, maybe try our product, maybe start using our product.
But I really like how it's just kind of a reciprocal circle that feels really good and really helpful and really additive to the community.
And so we said, okay, if this is what aligns most with what we believe as a company, then let's go all in.
We bet the company financially at least, on content marketing working, and we just so happened to hire some really good people that made it work.
I can't take a whole lot of credit for it other than the fact that I was willing to make the bet.
And since then, we've really invested a great deal of time, effort and energy into content marketing.
So much so that I think of Help scout as a 5050 business one free educational resources that try to advance the community and the support profession as a whole.
And the second part being the product, but they're sort of equal.
It's not just a marketing tactic for us.
It really is something that we want to give back because we feel like it makes a significant difference and the way small businesses operate moving forward.
Omer (38:27.420)
How did you figure out how to differentiate your content marketing?
Because there's no shortage of content out there, as we know, and it's not easy to create unique, differentiated content that people will want to consume and come back regularly to get more of.
What was the thinking behind the way you came up with your content marketing strategy to stand out from the crowd
Nick Francis (39:01.290)
when you're kind of starting at zero?
Standing out.
Those tactics evolve very quickly.
At the time, standing out meant doing a ton of guest posting.
So taking a topic that we knew was ranking in search engine terms that we knew didn't have a lot of coverage, the opportunity for us to rank really high was there, and we would guest post on that specific topic 25 different times.
We'd also post an article on our site that was a bit more comprehensive and thorough, linking back to that article and every one of those guest posts in order to kind of give ourselves a one up from an SEO standpoint.
And then once we give ourselves a little bit of leverage from an SEO standpoint, it just takes over because the content has to be really good, by the way.
It has to be excellent.
Actually.
There's no way around that.
And so we did a lot of guest posting in order to just kind of build up our own community.
And once the community got to a certain point, we were ranking for a certain number of articles every month, where we could pretty much predict 400,000 unique visitors every month.
And we still can.
Then we were able to say, just for lack of a better phrase, eff it, we're going to write about the things we love now, and the people that love this community and love this profession are going to resonate with it.
That's pretty much what we do now.
We pay attention to search engine ranking, but it's really about just trying to give back what we can to the community and trust that it's going to come back to us in a reciprocal way.
So we're investing really heavily in communities like Support Driven.
That's a community of thousands of support professionals.
They put on a couple conferences every year.
We're doing our best to invest in that community and forwarding it.
And we're building our own educational resources through a community that we built called help you.
It's just helpscout.com helpu completely free educational resources, all about advancing in your career as a support professional and what it takes to build a customer centric business as an entrepreneur, all sorts of those topics.
And so now it's just all about trying to give to that community and build the community to be as big as we can make it.
It's less about trying to get more traffic.
Omer (41:17.370)
And do most new customers come through your content marketing?
Nick Francis (41:23.610)
Not as many as you would think.
I just heard a story this morning and this is actually a problem that we face, but somebody had reached out to us on chat and said, hey, I've been reading your content for two years and I had no idea that you offered a product that's actually the opposite of what we.
We should be a little bit more forward with our product.
But maybe I haven't looked at it recently, but probably about 20% of our customers come from that channel.
But there's tons and tons of word of mouth that you just can't measure.
I don't bet my business on spreadsheet numbers.
I know that there's a lot of other qualitative inputs that are not accounted for in a spreadsheet.
And so I don't need to know the numbers to know that our content marketing strategy works.
Our word of mouth brand branding is very strong amongst the support and customer service community.
And I'm just going to keep investing in those things because typically the qualitative inputs are the ones that you can't write a check for.
And again, that's our most important way to differentiate from the other guys who are just looking at a spreadsheet and they can't make sense of the math and so they don't invest in it.
That's our opportunity.
And so we try to invest in those qualitative things.
Omer (42:39.060)
Okay.
We've talked about the journey in terms of where you came up with the idea and the process you went through to build the product and learning about SaaS through Techstars, raising your seed round and the growth that's happened over the last few years.
When you look back, are there any things that you wish you had done differently?
Nick Francis (43:07.070)
Oh, of course.
Too many for this interview.
Omer But I can give you a couple.
It's really hard because I can't say that I would have done it differently.
But hiring a great team and establishing the culture and the sort of people that we wanted to work with on a daily basis was really challenging.
Building that team.
It's something the three of us had never hired anybody before.
We just had to kind of learn how to hire.
And we made several mistakes in the first couple of years.
I think we had to let go of roughly 30% of the people that we hired because we just didn't have good hiring practices.
But by way of making those mistakes, we really refined the hiring process to the extent where I feel like it's amazing now.
And the biggest learning from that, just to kind of sum it up, would be test people's work.
The work is really important.
And it's shocking how many hiring processes don't actually look at the work.
They talk to somebody, they get juiced by the interview.
They feel like, hey, this person thinks like I do, they have the same values as I do, but you don't actually work with them.
So typically we have every single person we hire goes through some form of project where we can work collaboratively with them to create something and we can review what they created.
And that's a big part of the process.
I mean, it's unbelievable how many great interviews I've had that had crappy projects.
So just being able to judge the person not only by their interview skills or what they say they can or want to do, but by their capabilities and what they've been able to prove right now, not what they want to prove, but what they can do right now.
It's just shocking the number of companies that will hire folks without going through a project like that.
So that was the big, big learning there.
And then more recently, a big mistake that I made and I take full responsibility for it was just not understanding.
In the last couple of years, I misjudged the segment of our customers that was most important.
I just don't feel like I was close enough in hindsight.
And I ended up launching a freemium product of Help Scout.
So free version of the product.
And we just wanted to get as many signups as possible.
And that proved not to be an effective technique for a lot of different reasons.
But it basically came down to not understanding who our best market segment was.
And to give you a hint, it wasn't the three person startup that's willing to take advantage of a freemium plan and then grow into it, which by the way, hardly ever happens, at least in our world.
What we found is that the companies that are already 10, 15, 20, 25 people that are happy to pay for a really great product that solves their pain points is much more important.
And so for a lot of reasons, freemium just didn't work out.
We didn't understand the Persona well enough, and we learned from it.
Omer (46:14.750)
That's a really good insight.
And also the fact that you're somebody who has spent many years really trying to understand your customers and your market and talking to people, and it just shows that it's something that you have to continually do and stay on top of, because even with all the successes you've had, it's still relatively easy to make a mistake like that.
Nick Francis (46:41.620)
Yeah.
And markets change too.
Right.
So even if your product remains the same, the market and the customers in that market, the different segments that make up the market, will continue to evolve.
That's the shift that I missed.
Omer (46:55.220)
Now, I want to just give people a sense of the size of the business.
Do you talk about revenue or is that a secret number for you guys?
Nick Francis (47:03.300)
It's a secret number for us.
Omer (47:06.020)
So can you just give us, you know, if there are any other metrics that you can share just to give people a sense of the size of the business?
I mean, we talked about 8,000 support teams using the product.
Some of the companies, I think in terms of employees, you're around what, 60 people?
Nick Francis (47:24.390)
Yeah, around 60 today.
And, well, I can tell you this, we're operating 2 of the last 3 months we've been cash flow positive.
So we're operating the business in a very efficient and sustainable way.
So if you start to put together some of the math that's required in order to run a 60 person team and a product that's serving over 100,000 people every day and still make it work economically, that may help you with some hints.
Omer (47:53.800)
Yeah, you can get a good guess that way.
Now we're going to have to wrap up this conversation and so we're going to get onto the lightning round in a second.
I just kind of feel like there's so much more I would have loved to talk to you about and the fact that, you know, yes, you guys have raised $13 million, but for the first four or five years you had a seed round of six, $700,000, and you were basically very focused on being self funded, being profitable, and there were so many good things there.
So it's unfortunate that we don't have time to do that.
But I'D love to get you back sometime and maybe continue that conversation because I think there's just so much that people could learn from what you went through in terms of building this business.
Nick Francis (48:41.580)
Yeah, I love to talk about funding and just to give sort of a tilde to the conversation.
One insight is that you have to think of especially any form of institutional funding as rocket fuel.
And it's going to propel you in a certain direction very quickly.
And if you are just even slightly not pointed in quite the right direction at the time you take on that funding, then there's a good chance the rocket fuel is going to propel you to a place that may be undesirable in the future.
So the reason we waited for four years is to really understand the market, really understand our product, and have success without needing that money to have a little bit of our own rocket fuel, our customers, sort of fueling the business for a while.
And then once we see a big opportunity and we know we're pointed in the right direction, then we take that fuel.
So have no regrets about waiting four years to do a Series A. I
Omer (49:37.730)
like that analogy a lot.
He's very easy to remember as well, the rocket fuel thing.
So, yes, love that.
Okay, let's get on to the lightning round.
I'm going to ask you a series of questions.
Just try to answer them as quickly as you can.
Nick Francis (49:50.320)
All right?
Omer (49:50.880)
Okay.
What's the best piece of business advice that you've ever received?
Nick Francis (49:56.240)
Treat your spouse or partner like a co founder.
Omer (50:00.960)
What book would you recommend to our audience and why?
Nick Francis (50:05.520)
How to Win Friends and Influence People.
Because entrepreneurs have egos and they.
They need to learn how to deal with people.
Omer (50:13.760)
Oh.
What's one attribute or characteristic in your mind of a successful entrepreneur?
Nick Francis (50:18.700)
An insatiable desire to learn new things.
Omer (50:21.820)
What's your favorite personal productivity tool or habit?
Nick Francis (50:26.860)
When I wake up every day, I want to get one project done.
So one really important, impactful thing done before I do anything else.
That way, if the rest of my day goes to hell, I've accomplished something important.
Omer (50:40.380)
What's a new or crazy business idea you'd love to pursue if you had the extra time?
Nick Francis (50:46.690)
I wish I had time to think about something like that.
I want to do this for a long time, so it's not even on my radar.
Omer (50:55.970)
What's an interesting or fun fact about you that most people don't know?
Nick Francis (51:01.329)
I am a beginner surfer.
That's one of the things that I'm trying to become good at right now, even though I live in Colorado.
I have to travel to surf, I
Omer (51:09.850)
was going to say.
And finally, what is one of your most important passions outside of your work?
Nick Francis (51:16.630)
Being outside.
So I'm an introvert.
So as much as I can run and hike and snowboard and anything else, bike, just being outside, especially with my dog and my wife, that's something that will give me so much fuel and energy for business and everything else.
Omer (51:35.030)
Awesome.
All right, so now if folks want to find out more about Help Scout, they can go to helpscout
Nick Francis (51:44.620)
or dot com.
Omer (51:45.260)
You have the dot com as well.
Okay, cool.
And if people want to get in touch with you, what's the best way for them to do that?
Nick Francis (51:52.620)
I'm ick Francis F R A N C I s on Twitter and nickelpelscout.com shoot me a note.
Cool.
Omer (52:00.220)
Awesome.
Nick, it's been an absolute pleasure.
I really would love to get you back at some point because I just feel like we just scratched the surface and in kind of getting inside your head and sharing the story of Help Scout.
I really have enjoyed having you on, and I wish you and the team all the best for the future.
Nick Francis (52:21.090)
Thank you so much.
I hope it was helpful.
Omer (52:22.850)
It was awesome.
Nick Francis (52:23.890)
All right, cheers.
