Omer (00:11.840)
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 stories, strategies and insights to help you build, launch and grow your SaaS business.
This Week's interview is with a founder who had an idea for his startup while he was working for someone else and realized that there was a gap in the market.
He and his co founder initially bootstrapped the business.
They built and launched the product fairly quickly and started charging $5 a month.
Now, some people will tell you that you can't build a sizable business, you charging just five or ten dollars per month.
These guys didn't believe that.
They went on to raise $35 million in funding, currently have over 100 employees, and have an annual run rate of over $10 million, and they still only charge $15 a month for their product.
There are some great lessons in this interview and I hope you enjoy it.
Today's guest is the co founder and CEO of yesware, a sales platform that helps salespeople connect with prospects, track engagement, and close more deals.
Yesware serves more than 750,000 salespeople at companies like Adroll, Groupon, Salesforce, Twilio, and Yelp, just to name a few.
Yesware was founded in 2011 and is based in Boston, Massachusetts.
To date, the company has raised over $35 million in funding.
So today I'd like to welcome Matthew Bellows.
Matthew, welcome to the show.
Matthew Bellows (01:58.810)
Thanks, Omer.
Great to be here.
Omer (02:00.890)
Now, I always like to ask, kind of figure out what drives and motivates my guests.
And we often look for maybe a favorite quote that somebody has.
So is there a quote that maybe really resonates with you?
Matthew Bellows (02:14.010)
The quote I was thinking about sharing with you today is chaos should be regarded as extremely good news, which is a quote from a Tibetan meditation master named Trungpa Rinpoche.
Omer (02:28.380)
Okay, I don't know how to spell that, but I look it up.
Cool.
And why is that for you?
Why do you love chaos so much?
Matthew Bellows (02:37.499)
Chaos should be regarded as extremely good news.
It means basically that when things are unsettled, then there's a tremendous opportunity for growth.
And that could be applied to personal growth situations and also to business growth situations.
If everything was static, then there'd be no opportunity for startups to grow.
And a little bit of chaos is often very good for startups to grow into.
Omer (03:04.880)
Yeah, that's good attitude, good mindset.
Okay, so I explained to the audience a little bit about yesware, but in your own Words tell our audience what the product actually does.
Matthew Bellows (03:18.740)
Sure.
Yesware integrates with your email client, your Gmail or your Outlook client, your mobile phone, your calendar, your CRM system, and basically customizes it for sales.
So it makes salespeople more effective.
It helps you communicate better with customers and prospects.
It gives you feedback about when prospects are opening your message or downloading your links or reading your documents or engaging with your content.
And then it gives you suggestions about how to do better, about how to increase your productivity and be more effective as a salesperson.
Omer (03:57.080)
Okay, so let's start from the beginning.
How did you come up with the idea for this business?
Matthew Bellows (04:02.440)
Well, I've been a salesperson for most of my career, so I ended up carrying a, carrying a bag, carrying a quota for a number of years and then running teams.
And then my last job I was the VP of Sales at a venture back startup.
A post that I've held two or three times in my career.
So I just kept running into these same problems again and again and finally decided, you know, it was time to do something about it.
Omer (04:27.450)
You're kind of seeing this problem.
What, what exactly did you do when you decided I was going to.
I'm going to do something about it?
Matthew Bellows (04:34.600)
Well, the actual moment I remember it distinctly was when I was getting ready for a board meeting.
I was a VP of Sales, a venture backed startup in Massachusetts, and I was putting together my slide, which most founders in this call would know.
It's called your pipeline slide.
It's the list of deals that you think will close in the next 30 or 60 or 90 days and how much they're going to close for.
And you know, this is something that every VP of Sales has to do all over the world.
And I'm going through the process of talking to my reps and looking at their pipeline and talking to some of the customers and sitting on phone calls.
And I developed this slide.
And it's just I realized the night before the presentation how little data I actually had to get this number together.
I basically was just kind of guessing and guessing about each salesperson and how much they were sandbagging or how overly optimistic they were and then adding up all those guesses and putting on a slide that was more or less my career, you know, sort of betting my job on my ability to get this number right.
And it struck me as incredibly unsatisfying and not at all how it should work, you know, coming up on the 21st century.
So first I thought, oh well, our CRM is antiquated.
We need a new CRM.
And then I looked at a half dozen other CRMs out there and just realized that they all are predicated on the sort of garbage in, garbage out scenario.
And salespeople don't like typing stuff into their CRM system, and managers don't get a lot of value out of the things they read coming out the other end.
So I thought, there's just got to be a better way.
And that was the moment where I called up my friend Cashman and I said, hey, let's, you know, software for salespeople.
And he was like, yeah, I can build that.
And so we started yesware.
Omer (06:32.010)
So I want to kind of understand a little bit more about this because you kind of saw the problem and you decided initially that, you know, you needed a CRM system and then the CRM problem.
The CRM system wasn't the problem.
Matthew Bellows (06:49.000)
It was more that the CRM.
The state of the CRM industry was such that it wasn't, no one was solving the problem.
The problem is that the data that a salesperson or sales manager needs to understand what's going on with her or his business is stuck in the email box and it does not get translated properly into the business database of record, which is the CRM.
That's correct.
From the point of view that there's no one who should be typing tons of stuff into your CRM, it's totally ridiculous that highly paid, smart, hard working salespeople spend an hour or two a day typing information into their database.
Computers are really good at doing that.
There's no reason for CRMs to exist in that way.
It was basically that I realized that the CRM industry, a $30 billion industry, had not come to its final state and that instead it needed some serious innovation.
Omer (07:55.480)
And the type of information that you're talking about being typed into a CRM were things like how many people had opened an email, responded to an email,
Matthew Bellows (08:09.400)
even more basic things than that.
Just like, what did I talk to this prospect?
What did they say?
Did I meet with them?
How did the meeting go?
When did I think the deal was going to close?
How much did I think it was going to close for?
Like, the very most basic aspects of the sales process were manually entered by optimistic and sometimes confused salespeople into a database that had no real analytics based on the activity of the salesperson or the interest level of the prospect.
And that seemed to me to be fundamentally wrong.
Omer (08:46.970)
Okay, so you've got this idea, you see a potential opportunity, and then you said you talked to your Co founder Kashman.
How did you two meet?
Matthew Bellows (09:02.330)
We met actually at his first job out of college and my first job moving back to Boston.
Omer (09:10.190)
Where did you guys go with this idea?
Did you start to say, okay, let's go out and validate it, let's just start building something?
What were the next steps you took?
Matthew Bellows (09:17.790)
Well, he and I had started a company before and we had built it up and sold it successfully.
So we kind of been through the startup thing together.
We knew a lot about each other and kind of knew how we responded to each other and worked well together.
So we had a couple legs up from that point of view.
I guess where we started was sort of sketching out different things on various notepads and napkins and whiteboards.
He was living in Brazil at the time and I was living in Boston.
So there was some amount of sort of transcontinental flying and skyping.
And I remember we met in late 2010 in his parents home in Louisiana and sort of had a final dinner table conversation like, are we really going to do this?
And both decided to do it.
And then at that point we sort of moved into the prototyping phase.
Omer (10:16.190)
So the company that you guys had founded before, was that WGR Media?
Matthew Bellows (10:22.270)
Yes, exactly.
Omer (10:23.870)
So you guys launched this mobile focused media company, ran that for a few years and then sold it to cnet.
Matthew Bellows (10:34.600)
Yep, that's right.
So you see for your listeners, you know, in terms of financing strategies, that was a bootstrapped company where we just, you know, grew it based on collecting from our customers.
Yes, we're as a VC backed company, so we can grow, you know, employee headcount ahead of revenue.
So.
So I've had experience now with both kind of major models for financing.
Omer (11:00.790)
Okay, so you guys have decided that you're going to kind of pull the trigger on this.
Did you do any kind of validation?
Did you kind of go out and start doing kind of, you know, customer development interviews or things like that?
Or were you really, were you the customer?
Matthew Bellows (11:16.710)
Yeah, I did.
I did customer interviews and I met with a bunch of salespeople that I knew and sales managers that I knew.
And I met with some investors actually early on just to sort of sanity check the idea.
So there was a lot while Kashman was sort of thinking about the technical side of the prototype he wanted to build, I was sort of thinking about the basic problems that we were solving and the general approach to the application we wanted to build.
But honestly, when I think back on it, I, I mean I had pretty much already sold Myself on this being the biggest opportunity I've ever seen in my lifetime.
So I probably wasn't.
I was putting my thumb on the scale, to be sure.
Omer (12:05.970)
Now, I don't know what the state of the market was around that time, 2010, 2011, but I'm guessing Yesware wasn't the only product or you know, product about to launch sort of solving this type of problem.
Matthew Bellows (12:24.140)
So it was actually really.
There were very few companies focused on salespeople back then.
There had been, there had been in the past.
There were companies like ACT and Goldmine and even BlackBerry was really started as a sales focused company.
But all of them either, you know, morphed into CRMs, which are much more management focused or became the marketing automation companies that we know now.
So in 2010, 2011, there were very few companies that were serving salespeople.
And I remember in our first interviews with investors, a lot of them were sort of saying, like, that's not a category.
There is no software for salespeople out there.
And my point was sort of like, I know exactly.
It's the most ridiculous thing I've ever heard.
Like, there's gotta be.
We should make it.
Omer (13:20.240)
How did you figure out where you were going to focus your efforts?
I mean, trying to build a tool for salespeople seems like a really broad space, incredibly huge market.
So did you guys kind of have any kind of conversation about, okay, here's how we're gonna niche down, here's how we're gonna kind of be a little bit more focused when we go to launch or you didn't think about that?
Matthew Bellows (13:47.770)
We did, we did.
And it was some of the most important decisions that we made earlier on were to be more and more focused.
And frankly, I think we could have been even more focused thinking back on it.
But one of our early customers and advisors, a guy named Jeremy Allaire, who started Allaire Corp, sold to Macromedia and then started a company called Bright Cove here in Boston, was the one who really recommended that we start with the Google Apps ecosystem.
So as your listeners probably know, there's two major email platforms out there now.
There's Outlook, which is probably 90% of the market, and then there's Google Apps and Gmail, which is probably 5 or 6% of the market.
And Jeremy's advice to us was to start with Google Apps, which is obviously much smaller as a market, but full of early adopters with a much better development platform and a much easier distribution platform channel.
And so we, after some consideration, decided to go with that approach and that was a really helpful focusing function to really get us just on one platform, and an easier one at that.
Omer (15:08.690)
So I'm curious, how would you have.
I mean, as you said, sort of ideally you would have niched down even more.
How would you have done that differently?
How would you have been even more focused?
Matthew Bellows (15:20.610)
Well, I think in addition to being focused on a technology platform, which really did help us, we could have been more focused on the segment of the.
Of the sales world that we were selling to.
We started with a freemium business model, and we started sort of.
Anybody who wanted to download yesware could.
And anyone could buy it for not much money.
We started with five bucks a month as the price tag.
And I kind of wish we had used price discrimination and.
And maybe like, pricing model more aggressively to get fewer people to buy the product, in a sense.
And only the ones that were really the right kind of salespeople that we.
That we wanted to build the product around, we ended up getting, in the early days, a lot of consumers and a lot of people just kicking the tire, you know, and if we had charged more and maybe charged annual only, we might have gotten few of those people and therefore been able to be more focused on building just the features for our target market.
Omer (16:28.690)
Yeah, that's a really interesting point, and I want to talk about that a little bit later as well, because it is tough to kind of figure out when you get started.
You just want to get the product out there.
You want people using it, and even if you're getting a dollar a month, at least, it's some kind of validation that people are willing to pay for it.
But then when you grow and you start to scale, then you sort of figure out, okay, well, I probably didn't want some of those people using this product right now.
Now, how do I kind of move away from that?
Matthew Bellows (17:00.240)
Yeah, I mean, it's not a bad problem to have at all.
But thinking back on it, maybe we could have turned the dial.
Of course, at the time, everyone who was downloading it, I remember the first 20 people that downloaded it, I wanted to go hug them all.
I don't mean to sound ungrateful to those early consumer adopters, but we always did want to build software for salespeople.
And so it's arguable that we could have been more.
Even more effective if we had just started with them.
But not a bad result either way.
Omer (17:38.870)
How did those first 20 people find out about Yesware and start using the product?
Matthew Bellows (17:46.230)
Well, we were.
I mean, we're based in Boston, and We, we were in an incubator space in those days when we first built the first version of yesware.
And so I literally just walked around to everyone else in the incubator and said, will you try this out?
And sort of sat over their shoulders and we actually, we used software to record their clicks and I asked them sort of user centered design questions about could you perform this task?
Kind of questions and so recorded all their feedback and learned a lot about our design assumptions and how salespeople actually needed it to work.
So we were able to get a lot of good personal one to one feedback in that way.
Then we really lucked out because we built this as a browser extension and we posted it in the Chrome Store for browser extensions.
And that just turned out to be an incredible source of traffic for us.
And we got a lot of users for free from the Chrome Store that we never could have contacted otherwise.
So that was a tremendous boon for the early days.
Omer (18:57.470)
Did you have to do any kind of paid placement there or anything?
Matthew Bellows (19:03.150)
No, we really didn't.
We sort of tried to kick start the reviews.
They have an algorithm that sorts these apps by, by reviews and recency of review and star ratings.
So for the first 20 or so people that used it, we said please fill in a review and we made it easy to write a review from the application and we built in a little feature that was like, if you like, yes, where tweet this kind of thing.
So those very simple word of mouth kind of features and then a great channel for distribution like the Chrome Store was really all it took.
Omer (19:41.950)
So how long did it take you to go to your first 100 users?
Do you remember?
Matthew Bellows (19:48.830)
I think it was, you know, in a week.
Omer (19:51.790)
Wow.
Matthew Bellows (19:52.830)
Oh yeah, maybe last.
I mean it was very quick.
Omer (19:55.950)
And what did you learn from that?
It was, you know, it's, it's great that people find out about a product.
It's, it's free to try.
So, you know, the barriers are very low.
Yeah, but what did you learn from that?
Did people tend to continue using the product or did you find problems or things that you hadn't anticipated?
What was, what was the general kind of churn in the early days?
Matthew Bellows (20:23.160)
Well, I think the first thing I learned was that, you know, distribution is at least as important as your product idea.
And it sounds kind of obvious, but I mean we as a startup community spend so much time talking about product and product and product and how great product is and how important it is and importance design and product and all this stuff.
But you know, distribution is at least as important as that.
And I mean, I think we work hard on the square application, we work to make it good.
But if we hadn't had that free and busy distribution point at the beginning, I'm not, I'm not sure we'd be here where we are now.
So I would just encourage folks who are getting their startup off the ground to sort of pause the application development process for a minute and think about the distribution of that app.
Because if you can hack that, then you've got a really, really much better chance of success.
That's like, that's in my mind for my next startup, if I ever have a startup, next startup and onwards.
Great learning from this whole experience.
But you know, from the, from, from the early days of yesware and the first users there, I mean, I learned just a ton about again, what salespeople actually need, how they want the workflow to actually be the most important features.
We didn't.
So one of the most important features, one of the most popular features with yesware now is basically email tracking.
As far as I know, we were the first company to take email tracking, which, you know, is a very standard and old Internet technology that was applied to one to many emails, like email newsletters and things like that, and apply it to one to one emails so that if I send you an email I can see if you open it or not.
As far as I know, we were the first company to, you know, apply that technology to one to one emails.
And we did it sort of as a last ditch effort in a sense.
I mean, not really.
But it wasn't the first feature we built at all.
We first built a set of templates for salespeople to very quickly respond to incoming email or to prospect with.
And we rolled that out and people were using it, but it took a little while to get into.
So people would download the extension and install it and we get a couple hundred users, but they sort of weren't going back to it or only the ones who were really excited about templates were going back to it, which is only 10 or 12%.
So it felt like there wasn't an immediate sense of gratification with the early version of yesware.
Then we add this tracking feature in and it sort of everything turned around and the engagement went way up and people started writing us about how great it is and things like that.
So, you know, we were able to find pretty quickly a feature that really lit up our users without very much investment from them.
And that was sort of kind of the gateway drug for yesware, was that
Omer (23:34.640)
just an idea that you guys came up with or was that something you, you discovered from customer feedback, that a problem that they had?
Where did the idea come from for that?
Matthew Bellows (23:44.810)
Well, we knew about that sort of approach to tracking emails because of a previous company that we had worked at.
We worked at an email company that sends out newsletters for big publishers.
And so we knew that you could track opens and link clicks and things like that, but it just never been, hadn't been applied to personal one to one email business emails that we knew of.
But it was relatively easy to implement and so we got that in there and just shipped it to see if it would work.
Omer (24:20.930)
What were you doing?
Were you just using some kind of, you know, image or something embedded in the email as a way to track.
Matthew Bellows (24:28.690)
Yeah, that's, that's what, that's how it works.
Omer (24:30.570)
Now the Chrome Store turns out to be a piece of luck.
You get a good start, jump start with your distribution strategy.
Were there other things that you tried that maybe didn't work?
Matthew Bellows (24:51.680)
Oh my gosh, so many.
In terms of the application, we've, we've probably cut half as many features as we have in there now.
We would try different features, we would roll them out, people wouldn't really use them, we'd cut them, we'd try something else.
There's been a constant winnowing process with the different individual features within yesware.
One of the early ones, which I still love as an idea honestly, was called goals.
The basic idea is like, hey, salespeople are goal oriented.
Let's pop a little window here and say at the beginning of the month, what's your goal for this month?
And you can type in your goal and then we could track your progress towards those goals.
Some things we could track automatically, some things we track manually.
But it would give you this little meter, like a little score that says, here's your progress towards this goal.
I thought it was a brilliant idea, if I do say so myself.
But we implemented it, we shipped it and no one really used it, so we pulled it out.
Omer (26:06.040)
What about from a marketing perspective, things that you tried that didn't work?
Matthew Bellows (26:12.280)
Well, we didn't, especially in the early days, we didn't do very much marketing at all just because we had all these free users coming in.
Omer (26:20.080)
Um, so was, was it like, you know, 80, 90% of your users were coming through from the Chrome Store?
Matthew Bellows (26:28.480)
Uh, at the beginning it was a hundred percent.
You know, it's like hundreds of users a day.
Yeah.
Omer (26:35.680)
Wow, that really is.
I There was.
I can't remember.
There was another founder I spoke to who had a similar.
Similar sort of luck with the Chrome Store, where they not only got in the store, but for a certain amount of time they got featured on the homepage and that really helped kickstart what they were doing.
The other side of it is there's probably lots of people who've tried the Chrome Store and have just got lost in there with never been discovered.
Matthew Bellows (27:04.050)
Right.
It's better than the iPhone app store, but not by much.
Omer (27:12.780)
Yeah.
When did you guys get funding?
Matthew Bellows (27:20.460)
We raised our first round in April of 2011.
Omer (27:25.260)
Like, how were you.
Were you bootstrapping in the early days or.
Matthew Bellows (27:30.540)
Yeah, yeah, we were just not taking a salary and we chipped in, we contributed some money and.
Omer (27:37.990)
And then April 2011, how much did you raise back then?
Matthew Bellows (27:43.830)
We raised about 1.2 million.
Omer (27:46.870)
Is that the point where people were telling you, hey, this is not a category?
Matthew Bellows (27:51.350)
Yeah, yeah, yeah.
Omer (27:53.349)
I mean, I think that's a really interesting thing that, you know, on the one hand, you can kind of launch a product into an existing category and then people will tell you that there's.
There's already a bunch of companies doing what you're going to do and is, you know, CRM is a classic case.
Matthew Bellows (28:10.880)
Right.
Omer (28:11.040)
I mean, every time I see a new product launched, a new CRM product launched, you got to wonder, it's like, do we really need another CRM product with everything that's out there?
But.
And so it's really about how do you differentiate?
But then you guys have kind of differentiated so much that you were in a category of your own, and then you have to kind of explain to people that, no, there's a valid reason that we need to have a new category here.
Matthew Bellows (28:35.290)
Yeah.
I think investors, their job is to try to find the one out of a thousand company that they feel good about backing.
And so they're looking for reasons to say no.
And there's a lot of them.
For a startup that's untried and untested, I must say it was harder than I expected for us to.
To raise a seed round just given that we had already built and sold the company.
But, you know, we just kept at it.
Basically.
Omer (29:06.690)
I found a New York Times article that about you back from 2000, August 2014, where they talked about some of the challenges that you were facing with yesware.
And I'll just read kind of a little segment from that here.
It says, converting free users into paying customers by early 2013, even with a newly hired 10 person sales team.
Yesware's sales were abysmal and the company had yet to turn a profit, casting a pall over bending efforts to raise venture capital.
So I thought that was really interesting one in terms of what happened there, but also the fact that you went for it.
Matthew Bellows (29:52.040)
I'm sorry I said interesting is one word for it.
I mean, to be fair.
Omer (29:57.550)
Fair.
Matthew Bellows (29:57.790)
I think the reporter, he's trying to make a story.
So it wasn't quite as dire as it sounded in that piece, but whatever.
Close enough.
Omer (30:11.070)
I want to talk about what happened there that you've got to a point where, I mean you've raised funding, you have revenue coming in and you have, you've grown to a 10 person sales team, but something isn't still clicking here.
And so you had sort of gone away and said, okay, I have a few options that I can take here to sort of turn things around.
I can either sort of clean house and fire most of the salespeople.
Step in myself as VP of Sales.
I can hire a VP of sales and have somebody come in and sort of take care of doing all of that for me or I can grow somebody from within the sales team to, to start managing the team.
So kind of just setting the context there, I want to kind of talk about, kind of go back to that, what was kind of going through your mind at the time and then what you did.
But I don't want to just kind of kind of replay what the New York Times article covers because we can just include a link to that in the show notes.
But I'd really like to sort of drill down into what were some of the specific things that your sales team started to do differently, which helped you to start generating even more revenue.
So kind of going, going back to that you had those three alternatives or choices.
What did you decide to do?
Matthew Bellows (31:43.510)
I decided that while that I was going to search for a VP of Sales, I was at that point trying to both be the VP of Sales, which is a position I've had in the past, and also be the CEO.
And I think that's where I was really trying to do kind of too much.
And it took, you know, some.
It took, it took a couple months for me to really see that that's what was holding us back.
So I decided to go out and start a search for a VP of Sales.
Knowing that that was going to take a while, you know, three to six months.
I promoted one of the folks inside the team to be sort of Director of Sales.
While I did that search.
Omer (32:25.610)
Do you think the challenge of converting free users into paying customers, do you think this was a sales problem alone or do you think it was also a product slash kind of value prop problem?
Was there enough of a compelling reason for people to switch to a paying plan, a paid plan?
Matthew Bellows (32:48.940)
Actually the switch from a free version to an individual plan was pretty good.
And the conversion was high, actually quite high.
The problem that we were having was converting those paid users, those individual paid users or small teams at companies to a corporate plan to sell it to the entire organization.
So that very much was, I think, both a sales and a marketing problem, like a sort of lead readiness MQL kind of problem.
Omer (33:26.280)
What I think was interesting what you just said there was and it kind of made me realize that this was kind of, instead of trying to do this as sort of a top down sell, where you kind of going in
Matthew Bellows (33:37.160)
and
Omer (33:39.850)
maybe talking to, you know, the CEO or C level person about, hey, here's a, here's a CRM solution that your organization should be using.
Because you were targeting a tool for salespeople, it was relatively easy for any salesperson who was using Google Apps to start using your product and even start moving over to a paid plan.
And that was kind of almost like your Trojan horse into the organization.
And then the question was, okay, how do you leverage that opportunity, that kind of opening that you have to get more people in that organization also using the product?
Matthew Bellows (34:17.150)
That's right.
That's right.
The initial sales that we had to corporations were largely spurned by their salespeople or sales management or head of sales operations calling us and saying, hey, know, 60 people at our company are using Yesware, you know, what the heck is it?
How does it work?
And you know, those are obviously really, really good sales leads.
And so we would work on those deals.
And that's how we closed Groupon and Box and a number of other early, early companies.
Omer (34:49.240)
So what, what changed with the sales team?
What did they start doing differently?
Well, I had to say, you, you, you eventually hired a VP of sales.
Matthew Bellows (35:00.380)
Yep.
Omer (35:02.140)
And so what, what changed in terms of what they were doing?
Matthew Bellows (35:05.980)
I think the big, the biggest thing that changed was that they then had a person who was, you know, really working in the trenches with them, strategizing on every call and meeting and deal.
And in the past I had been sort of letting these salespeople sort of, you know, go out and eat what they kill, but not helping nearly as much as I think they needed me to do, to do, given the state of the product and the market so when we hired this woman, Bridget Gleason, who was our first VP of sales, she really got down in the weeds with people and helped them move deals ahead and that really accelerated things.
Omer (35:50.610)
You know, I don't think we can kind of spend the time that we have to give people a deep dive into how to do sales and prospecting and close deals.
But for somebody maybe who is a, let's talk about somebody who's maybe a founder or maybe some co founders, they're at early stages, maybe they're doing the sales themselves.
What would be your advice to those people?
What are some practical things that they should start to think about to implement on a day to day basis to help them get a kind of an early stage sales machine going?
Matthew Bellows (36:40.460)
Well, there's a really wonderful book by Mark Roberge, who is the first head of sales at HubSpot.
It's another Boston based company and he puts it, he's got a great plan in that book.
So for folks who want to dig in deeper, I would recommend looking at Mark Roberge's book on this.
In a nutshell, I feel like making sure that the quality of the leads that you're passing to the sales team is high is the first thing.
And then the second thing is gate the number of salespeople you hire by the number of leads that you have coming in.
Now that sounds like a really obvious thing to do, but it's surprisingly hard to figure out what a good lead is.
And so my advice there is to make it harder than you'd think it would be.
As a founder, you have an inbuilt advantage when it comes to selling things because you know the product so well and you can speak so you know lovingly and authoritatively about the project while you're doing it.
But it's harder for other people to come in and sell that product.
So you want to give them the best chance to succeed, which means make sure that the leads that you're providing are really, really, really high quality and then only hire salespeople when you're sure you have enough leads for the second or the third or the fourth one.
Omer (38:09.270)
So the book that you mentioned is called the Sales Acceleration Formula and we can include a link in the show notes for that.
I think that's, that's good advice.
And so let's, let's kind of think of a scenario where somebody maybe is using yesware or decides that they want to start using yesware.
What, what are some good best practices that they can kind of put in place to get Better quality leads coming through.
I, I guess it starts with, you know, obviously like where, where you're getting these potential, you know, emails from that you're going to start prospecting with.
But, but where does that start?
Where does it start with writing the email in a particular way?
Is it about doing the right kind of follow up with people?
Is this certain?
Matthew Bellows (39:10.300)
How would I think it starts at the very, before any emails.
It starts with being very specific about your target market.
It starts with a very clear buyer Persona.
You know, we want to sell this product to IT managers in small and mid sized companies located that serve these particular industries potentially like in these geographic areas.
And if you can be very specific about your target market, then you can get down to the point where you can go and buy a list of those people and then start calling them up or emailing them and saying here's what I'm doing.
Because of our sort of success with the Chrome store, we had a lot of leads, but they were coming from all over the world actually.
So we weren't as disciplined about focusing our sales efforts on a very specific target market.
And we sort of waited for the market to emerge, which it ended up doing.
But I think we might have been more efficient if we had presupposed a specific target market, dominated that at the outset and then expanded sort of in a more disciplined fashion from there.
Omer (40:32.180)
So in the early days were your salespeople just going through the list of free users and trying to engage them and some of them happened to be maybe the target customer, others were maybe a consumer trying to use it just because they thought it was kind of a geeky thing to do to track people's open rates or something.
Matthew Bellows (40:53.710)
Yeah, I mean it's, it's.
We could do some amount of discrimination from the beginning, which you know, is necessary.
We, anyone who signed up with a gmail.com address, we didn't, we never contacted people that signed up from non English speaking countries.
We didn't contact.
Like we could do some amount of filtering there, but I just think we could have been more disciplined about it.
Omer (41:15.570)
Yeah.
So what would you have done differently?
I think
Matthew Bellows (41:23.490)
again, 2020 hindsight, but if we had set a higher threshold for what would constitute a lead instead of it being sort of, let's say any US company with three or more Yesware users at it, if we instead said any US company in the high tech or media industries with 10 or more paying users at it, you know, just made it much higher to get to that threshold, then we would have hired fewer Salespeople.
And we would have, you know, those salespeople likely would have been able to close those deals more efficiently because they would have been spending time on other leads that weren't as good and so on and so forth.
Omer (42:12.030)
When we started talking, you said that when you launched the product, you were charging somewhere like $5 a month for the paid plan.
And you often hear what I often hear people saying, well, you can't build any kind of sizable business if you're charging 5 or $10 a month, which
Matthew Bellows (42:39.900)
is totally not true.
Right.
If you look at Dollar Shave Club, you can clearly see that you can build a sizable business, but it has to be a very broad ranging business.
Omer (42:50.460)
Right.
Or you need to have a path to get people up from your customer value in terms of, you know, how much you're going to be able to charge people.
There needs to be some kind of path where you can deliver ongoing value where more people will.
People would pay more or more people will use the product.
And so I want to kind of give people a sense of the scale of your business now in terms of like ballpark revenue.
Where are you guys right now?
Matthew Bellows (43:19.030)
We're over 10 million a year.
Omer (43:20.790)
Oh, that's, that's huge.
So congratulations on doing that.
Matthew Bellows (43:25.190)
Thank you.
Omer (43:27.510)
And you're not charging $5 a month anymore though, are you?
Matthew Bellows (43:32.680)
No, we're not.
The lowest price now for yes square is $15 a month.
Omer (43:37.640)
And do you.
I remember that you used to have a, a sort of a free plan where you could send like 100 emails a month or something like that.
Do you still have that?
I think I read somewhere that you'd stop doing that?
Matthew Bellows (43:52.680)
We did.
We stopped the free plan in May of this year.
Omer (43:57.080)
And was that, was that because you just got to a point where you just had enough critical mass where you didn't want to sort of continue with a freemium model?
Matthew Bellows (44:08.560)
No, it was a very difficult decision actually, you know, because we had spent almost five years as a, as a freemium company.
But we, you know, we did a lot of analysis of the people that were using the free product and realized that they weren't in a sense, carrying their weight.
Unfortunately, they weren't contributing back to the business as much as we needed them to in order to keep supporting their use of the application.
So we gave them a special discount and a new trial of the current version of yesware because many of them hadn't seen a lot of the features that we've rolled out in the intervening years and then said, we hope you end up Signing up and joining again.
But for those who didn't, we ended their free plan
Omer (45:02.070)
and size of the business.
How many employees do you have now?
Matthew Bellows (45:06.390)
Almost 100.
Omer (45:08.310)
I guess there are a lot more competitors in the market today as well than there were back in 2010 or anything.
Matthew Bellows (45:15.750)
That's right.
That's true.
Which is obviously a good thing, but
Omer (45:19.460)
I think it's just.
What I love about this story is that you started off with a big vision, but you executed in a kind of a smart way.
Get to market quickly, were very realistic about what you were charging for the product, and I think you're a great example of, hey, you don't have to always go and charge customers several hundred dollars a month to be able to build a business that does over $10 million a year.
So it's an awesome story.
All right, it's time for our lightning round.
I'm going to ask you a series of questions and just like you to answer them as quickly as you can.
You ready?
Matthew Bellows (46:05.270)
I'm ready.
Omer (46:06.390)
What's the best piece of business advice that you ever received?
Matthew Bellows (46:12.070)
I didn't receive this personally, but it's advice that rings true for me.
The Winston Churchill quote, never give up, never, ever, ever give up.
Omer (46:23.560)
I love that one.
What book would you recommend to our audience and why?
Matthew Bellows (46:31.640)
Geez, that's too broad a question, I think.
I don't know your audience well enough to say, but I did recommend that Mark Roberge book for people interested in sales.
Omer (46:39.400)
We'll include that one.
What's one attribute or characteristic in your mind of a successful entrepreneur?
Matthew Bellows (46:45.430)
I think it's got to be perseverance.
I think it's got to be grit, the ability to keep going.
I think a lot of entrepreneurism can be summed up into having an inspiration.
Running up into an obstacle, coming up with a creative way to solve the obstacle, getting inspired again, hitting another obstacle, solving the obstacle, and so on.
I think that's pretty much it.
Yeah.
Omer (47:13.120)
What's your favorite personal productivity tool or habit?
Matthew Bellows (47:16.880)
Well, I mean, I have to go with yesware.com I actually do use it every single day.
It really.
It's a good application.
Omer (47:26.240)
What's a new or crazy business idea you'd love to pursue if you had the extra time?
Matthew Bellows (47:31.200)
Oh, my goodness.
Yeah.
Ideas are not.
Are not my problem.
I'm really interested in this.
In this category of software where the product sells the product.
And so I'm interested in product and product analysis.
You see some things from Mixpanel and Gainsight and things like that, but I think There's a lot of opportunity in that space, which is not really, as far as I can tell, being worked on that much.
Omer (48:05.380)
What's an interesting or fun fact about you that most people don't know?
Matthew Bellows (48:12.740)
I spent a year living in a meditation center in northern Colorado before coming back east and getting a job.
Omer (48:20.260)
Wow.
Wow.
I mean, when we were kind of before we started recording, I kind of told you I kind of wanted to talk about the meditation if we got a chance, but I didn't realize that you were that into meditation.
That's some pretty serious stuff.
Matthew Bellows (48:36.400)
It was amazing, actually.
It was a great year.
It was the best year of my single life, for sure.
Omer (48:41.040)
Oh, wow.
And finally, what is one of your most important passions outside of your work?
Matthew Bellows (48:46.480)
Well, I've got three kids who are extremely endearing and cute and funny and occasionally very challenging.
So that's.
Omer (48:56.650)
That's.
Matthew Bellows (48:56.890)
It takes up most of my energy outside of work.
Omer (49:00.170)
Matthew, I want to thank you for joining me.
Thank you for sharing your story about yesware and the lessons that you learn along the way.
As I said, it's a.
It's a great story of, of how you've built a sizable business in a relatively short amount of time.
Now, if people want to find out more about yesware or give.
Give it a try, they can go to yesware.com if they want to get in touch with you.
What's the best way for them to do that?
Matthew Bellows (49:29.900)
My email address is Matthew M A T T h e w yesware.com or you can reach me through Twitter.
Bellows.
Omer (49:39.340)
Okay.
Awesome.
Matthew, thanks again.
It's a pleasure.
Matthew Bellows (49:42.380)
Thank you.
Elmer, Great talking with you.
Omer (49:44.020)
Cheers.
