How to Exceed $100M ARR: Lessons to Scale with Sustainability | ActiveCampaign COO Milos Srdjevic

session, and we really do encourage our attendees to keep their cameras on, unmute, speak up, really join the conversation, ask questions, make comments. Different ways of doing that, right? So you can truly just unmute. You can also drop your thoughts or questions to Milos into the chat function at the bottom of your Zoom, as well as raise hand icon, and we can call on you. So a lot of different ways to stay engaged during the session. Lastly, these sessions are being recorded, so they will be available on demand after the event if you'd like to see them over again. So you can find those on our SaaStr YouTube page. Without further ado, I'd love to introduce Milos, COO of ActiveCampaign, as our featured speaker today on how to exceed $100 million ARR, lessons to scale with sustainability. Milos, I'm gonna pass it over to you.

Thank you. Thank you, Lindsay. Welcome everyone. I'm really excited to be here. We have a great topic ahead of us today, and as Lindsay said, it's how to exceed $100 million ARR with the focus on sustainability. My name is Milos Savicevic, and I'm coming to you from ActiveCampaign, where I spent over 15 years scaling the company and designing it with sustainability in mind. ActiveCampaign is a customer experience automation company. For you who don't know what that is, customer experience automation is a new category that's designed to pretty much enhance every software category that is out there by allowing them to work together and help you orchestrate your optimal customer experiences. ActiveCampaign is a global leader in customer experience automation. We are very proud to serve over 100,000 customers in over 170 countries. We're proud to serve the, the SMBs in all verticals and across all continents. And we are able to do that by utilizing the amazing group of over 750 talented people from around the world who are pivotal to achieving our efforts. A big testament to the customer experience automation as an industry is that our platform is not just number one in the customer experience automation space. We're also holding many top 10 positions in other tangent categories that are not necessarily, you know, customer experience automation. That just proves to us time and time again that the market is are recognizing that the customer experience automation is at the very center of things. And even if we're talking about the specific software categories such as landing pages, CRM, or, or so on, people recognize that the customer experience automation is at the center of it. So how did we reach and surpass $100 million in ARR was really by constantly obsessing over our customers and looking for any and all ways to help them scale their business and reach their clients in a meaningful way. So how did we really get there? How did we achieve the scale with the sustainability was really by building a sustainable culture, by a culture, by building a culture that is obsessing over our customers. It all starts at the very beginning and it's really embedded in our core. It starts from day one. Jason M. Lemkin, our CEO, was always listening to our customers carefully and using that to drive our decisions, and that's happening to this very day. Jason still talks to our customers all the time. We have a very, very strong voice of the customer program that provides us very valuable insights that drive our business forward. So we really are focused to look for any and all opportunities to help our clients grow their business. And one of the cool things about that is one of our values that is about wowing our customers, and there is something that we all strive to do here at Active campaign. Benefits are actually multiple to that. It lets us help clients kind of keep their wheels turning and figure out what is the next best move for their business. And of course, it entices them to think about the next step in their business. And to us, it gives us, of course, an amazing insight into how our customers think and what are their goals and plans for the future. That gives us a head start with the next interaction with this client, as well as valuable data that we can use for long-term decision-making. And how do we do it internally? We iterate. Iterate everything always is one of our core company values, and it lets us remain agile. It lets us remain— adapt the change management as something that is sort of a natural thing. It lets us try new things and pivot at the moments when the pivots are needed. It helps tremendously when the market is, let's say, facing headwinds or tailwinds. A good example was just the past year with the pandemic that forced a lot of businesses to change their operations and to perhaps maybe pivot from an offsite-centric to the online-only or online-first approach. And The customer experience automation has proven to drive quite a good force for that. But our company value, which is the iterate everything always, allows— allowed us as well to change our company and how do we assist our customers during this time of need. Because at the point— at the end, no solution is really a long-term solution. At each stage, the task at hand will always be best solved using a tool that is designed to solve it. So the same goes for the tech, right? There's no ideal solutions. We strive, of course, to let our clients have a chance to use a best-in-class tool for whatever task they have at hand to solve it and to keep the customer experience at the center of everything of their customer operations. That way, any tool and any tech that they might be using is really interchangeable. At different stages, they will want to, to solve different problems in different ways using different tools. Like, for example, like the company transitioning to, let's say, an enterprise level while it grows is not going to continue to use most likely the same solutions that they used at the very beginning. By having customer experience automation at the center of things, that allows them the opportunity to interchange different tools and to basically continue running their business while maintaining their core operations and core values, while really just moving from one execution to another. If you want to look at it that way, the good analogy is kind of the CXA ends up being a brain of the whole operation or a central nervous system or something like that. So how do we do it here at ActiveCampaign? We basically obsess over what our customers do and how can we help them. We map out the whole customer experience, we map out all the customer journeys, find optimal routes for our customers as well as the routes that are not optimal that require optimization. We break the customer journey into different stages, we optimize each stage, we personalize each interaction, we basically try to make it meaningful. No contact, nobody wants to be contacted, you know, like at the times that they don't want or with the information that they don't want to receive. So to us, it's really important to find the optimal time to engage them. We do the same when it comes to our employees as well. The customer experience doesn't really end with the customers. The same methodology is absolutely applicable to all the internal processes of the operation as well. We can build amazing amazing employee experiences using the exact same principles and help them optimize their day-to-day and maybe introduce different types of notifications that are a best way to present them the data that they need for their next task at hand. And we iterate upon those things and improve upon, upon those at all times. Why do we do this? We rely on human creativity at the end of the day, and we're looking to harness that unique human energy. And we use the same principles to remove repetitive tasks from their way so that they can focus on providing the human touch. So, excuse me. So how do we do— how do we build such teams? We're always looking really for people who are customer obsessed, and we believe that is exactly what continues to drive our business forward. We look for people who are always comfortable with change management, who are eager to seize any and all opportunities ahead. We invest heavily into our human workforce as well, and that is where really the creativity comes from. Of course, the customer experience automation as a methodology is really powerful here because it kind of allows us to also prototype different ideas and different processes before we take them out to our customers. So in a nutshell, really the key takeaways here are that each and every decision usually should start and end with the customer in mind. Every decision, every action, every process implementation or improvement, it needs to start with and end with the customer's best interest in mind. Long-term view, of course, while solving for today, voice of the customer is really powerful thing to use for this. You can make current decisions that are going to impact your business today while keeping an eye set for whatever the long-term decisions you might be able to make and help you pivot to a different business model potentially in the future easier. And of course, at the end of the day, how do we do all this? We really break it into 3 things. We act on feedback, we automate any and all repetitive processes that we can think of, and of course we invest into humans because that's what matters most. That was all we had for this. Thank you for listening to this brief presentation. Let's switch to a Q&A at this time.

Excellent. We've got a few questions coming in. I could start off for you. So balancing automation and the human touch is so important. I've heard that from other tech companies. Are there, are there any industries that fare better with more automation than others?

That is actually an interesting question. What we've discovered so far is that practically any industry can benefit from customer experience automation because at the end of the day, No matter what business you're in, no matter what product you're, you're offering to your clients, you have a service component that you also have to nail down and optimize to the best way you can. And that is exactly where the customer experience automation comes in. No matter whether you are a restaurant owner or whether you're a realtor or whether you're a tech company, either way you have clients, you have to organize how you talk to them, you have to organize how do you interact with them, how do they try your new products and things like that. So customer experience automation Information is really everywhere and it's an embedded part of pretty much all company operations. Great, thank you.

Another question that's come in is how do you generate leads to reach $100 million ARR?

That's a good question. Actually, since the early days, the word of mouth has been a big, big driver of this. And that is probably one of the additional benefits of our culture and the approach of wowing our customers because we kind of realized that our customers ended up being the people who end up raving about us and the industry the most. And they're the ones who are actually showing others what are the benefits of this. And I mean, the best way to prove that is to see just the reviews that are out there. They're really all talking about customer experience automation being the next thing that actually organizes your business and allows it to grow, to scale, and to continue automating while also personalizing their experiences so that you don't end up just doing it at scale. Thank you.

Do we have any other questions that people want to join the conversation either by unmuting yourself or sending through chat? Looks like we just have another one come through here. Would you recommend PLG, product-led growth, versus top-down approach for sales and marketing, especially for early startups?

That is, that is an interesting question. We were blessed with having a product that really fits so well into our company core and the company values. So I believe that at the end of the day, each company is unique. Each company is going to have to find what is considered the secret sauce, the best utilization of both your product and service teams and how do you approach the specific market that you have at hand. So I guess the answer would vary, but it would also be very unique to any business. So the funny thing about the customer experience automation is that what we've witnessed is that even the businesses that are in the same industry are not necessarily going to operate the same way. Going back to, let's say, the realtor case, you can have realtors who are doing their job in one way and different realtor that is completely differently organized. So when you look at their setups of their customer journeys, they actually end up being quite different, although they're in the same industry.

Great. We have a live one. Tobin, do you want to join the conversation, ask your question?

Yes, absolutely. Thanks for taking the question. Thanks for your time on this, Milos. I'm with Redbrick. We recently acquired the Leadpages business. And have been actively really digging and understanding this industry. And looking at ActiveCampaign business, really curious about what you see kind of the core product offering being. Obviously you guys have an amazing set of features and functionalities, but just kind of wondering what you guys anchor on.

Oh, we definitely anchor on customer experience automations. The automations are a really big driving force of this. So different companies approach this in a different way, right? Like the company that might build a tool that solves for a particular problem will kind of inevitably now end up in a space of having to automate things because that is the next big thing. Where ActiveCampaign, on the other hand, we kind of took that approach of having automations central to all the operations and having ActiveCampaign in the middle of all the tool sets and just handling the, the automation, but also data enrichment and also the personalization along the way, where maybe the landing pages, the CRM, the calendar event tools, and all those other things might be all integrated and working together. But we strongly believe that the accent here should be on the automations. Great, thank you.

We've got another one coming through. My understanding was marketing and marketing automation was a super crowded segment over the last few years or so. How did you break through the noise?

That is an interesting question. Maybe we didn't need to break through the noise. I feel like we just needed to show to businesses that The automations themselves are really what is tied to building customer experiences and marketing at the end of the day, like inbound sales, outbound sales, and, you know, customer service. They're all teams who are working together to build the offering that your company is supposed to offer to its clients. So you can approach it, of course, from marketing automation. You can approach it from the sales automation. We just took a bit of a different, perhaps unique route by tying it to what really usually matters most to a business, and that is customer.

Great. Thank you.

This kind of allows us to also hit different stages of the customer journey, right? So you don't have to focus only on the, on the places where marketing plays the primary role. You can also use a customer experience automation to drive are other parts of the journey that are touched by different teams as well.

Great. A popular one during these current times is, how has the pandemic affected your company's growth?

Well, it has definitely affected the company. We've seen some mixed results. Like everybody else, of course, the pandemic really did hit hard small and medium-sized businesses. So You know, we try to do our part to help any and all clients who are coming to us either for advice or, you know, perhaps maybe like help with changing the strategy on how can they pivot their business towards the online-first approach. So of course, as any company, you do end up seeing a certain amount of churn. But of course, on the other hand, there's also a bit of —call it—tailwinds from the fact that a lot of companies are forced to adopt the online-first approach. And by us being there to help them and by us being able to pivot our operations quickly so that we can absorb the incoming requests was definitely something that proved to be quite helpful to the growing amount of businesses. For sure.

Thank you. Okay, we've got another question. Who is your audience? So in other words, who is purchasing your solution within a customer?

Sure. So again, I don't want to repeat ourselves, but this industry is so, so all-encompassing that we really do have clients from pretty much everywhere. We have small small businesses like mom-and-pop shops. We have one-man bands, solo entrepreneurs. We have marketing teams, sales teams, operations teams use it. We even have bigger enterprise companies where perhaps maybe some specific teams might use it. There's also some cool benefits with integrating multiple ActiveCampaign platforms and giving each team exactly specifically what they want to do. The applications are pretty, pretty huge. So what we're really kind of witnessing is more different industries discovering what is the application of the customer experience automation to their business and how they can best adopt it in their own unique way.

Great, thank you for clarifying there. We have a few more. Do you have a few more minutes with us? Sure. Okay, when expanding, do you recommend testing one country slowly and then move to another, or just try to grow as fast as you can in every country possible?

Well, that is a loaded question. I wouldn't say that I would necessarily favor either one of them. Each solution again requires a unique approach, right? For something, you might want to make sure that you prototype it with the local team. We did that a lot of times at ActiveCampaign, right? At our headquarters in Chicago, we would do something and prototype keep it, even if it doesn't seem like it's going to scale in the future, we like to try to do it just so that we can see what are all the nuances, how are we going to maybe apply it at global level. And of course, on the other hand, some other decisions were of course made with kind of global approach first in mind and realizing that this is something that will benefit people in different regions with different cultures, with different languages. So we were of course thinking about that. We were embedding that throughout building the platform, right? So it's really hard to say like which one should take precedence. At the end of the day, it's always finding the best tool for the task at hand, right? Of course, yep.

We've got one or two last ones. So how did your company determine the number of people you need to help focus on customer support and customer experience? What were some of the KPIs that allowed you to arrive to this decision of how many people to bring on in those areas?

Sure. The interesting thing about our specific journey was that we kind of chose that unorthodox path of building out the new category, right? So perhaps we did take a little bit of an unorthodox approach to this because a big Part of this was the education factor, right? So it wasn't really always necessary— necessarily about how quickly can we resolve a customer's issue and like send them back on their way. Yes, of course we want to do that, but it was also always about how do we continue to help the customer? How do we find out more about them so that we can, so that we can see where the businesses are going on the global scale? And use that to potentially drive our decision-making in the future. Great.

And we'll do one more question because I know you've got meetings after this, Ilya. So last one would be, you mentioned striving to wow your customers. Do you do that mainly through the capabilities of your products, or do you use other strategies?

We definitely use equally product and service. The opportunity to wow your customer are everywhere. We definitely try to do that through the product by trying to create the easiest way possible for them to spin up their operations. We just introduced over 300 different recipes and we have different integrations with different tools that just let them hit the ground running, set something up really quickly and get, get on their way and go back to the business, to building the business, which is essentially what they really love the most, and we want to get them to actually doing what they want to do versus trying to solve for the operational things and do the repetitive tasks. So, so yes, we definitely apply the same concepts to the service as well, right? So if we want to build the, the solution and the market that is centered around the customer experience, we want to be able to offer proper customer experience. And in our case, that meant while we're creating a new market that required spending maybe some extra time, maybe, you know, like leading some customers to explain to them what the benefits are. And of course, producing a lot of self-serve materials and a lot of webinars and, you know, interactive sessions like study calls and things like that, that kind of allowed us to amplify our message.

Great.

Well, Milos, thank you so much for today's time, and then thank you everybody for that, that joined the conversation and asked these great questions. Um, hope everybody, um, walk away with some great ideas and takeaways. And Milos, thanks again for being with us today. Have a nice afternoon. Bye-bye.