“The First $100,000,000 in ARR with Bitly’s CEO and CPO”

Please welcome to the stage Toby Gaberner, CEO at Bitly, and Kelsey Stevenson, CPO at Bitly.

Hey everybody, can you hear us okay? Good. Yeah, welcome. Um, hi, my name is Toby Gabriner. I'm the CEO of Bitly, and I am honored to share the stage with Kelsey Stevenson, who is the Chief Product Officer at Bitly. And we're going to spend about 30 minutes telling you and taking you through, uh, the Bitly journey and how we got to $100 million in ARR, which As we all know, it's sort of that magic number that, that all of us SaaS companies try and achieve. So let's hop on in. We're going to cover 3 key areas that we'll take you through that bring the journey to life. So the first is how we evolved our growth engine. The second is how we transitioned to become a multi-product platform. And the third is around the importance of team and how we invested and really built our team up. And those are probably the 3 most important ingredients, if you will, on our journey over the last few years to get to this $100 million in ARR. So let's dive on in. We'll start off with the evolving the growth engine. And let's— let me start with taking you a little bit on the journey of Bitly, because I'm sure most, if not all, of you have heard of Bitly. Hopefully you've all used us at some point. Over the years. But we've been around for about 15 years now. We were started in 2008, and there were a number of link shortening companies that all started around that time. And Bitly happened to become the de facto standard, if you will, or tool that was used globally for link shortening. And a lot of that was driven by, at that time, the development of a really robust freemium offering And it started to be a self-fulfilling sort of organic engine as the bit.ly started to proliferate all throughout the web ultimately. So we had this huge inbound funnel that was created very early on and that's continued all the way today, an important part of our story. What was interesting is, is that in around 2012, the focus became not on what you would typically see of a company that had that kind of engine of developing a PLG motion, but a sole focus on the enterprise. And if you were to go for many, many years and go to the Bitly site, you probably wouldn't have been able to figure out, like, how that company made money. Like, what was the monetization engine behind it? Because the big focus had been to cherry-pick out the enterprise opportunities that were coming through this funnel, ultimately. So that worked really well for a number of years. Let's be super clear, Bitly went on a great run. Um, we signed a ton of customers, uh, and really sort of established ourselves as the de facto link management platform in the world. Um, but eventually the, the company ran into a bit of a, a plateau and, uh, a challenge around 2018, 2019. Um, and that was right around the time when Kelsey started, and, uh, they began sort starting to experiment with introducing less expensive packages downmarket where customers could go online and set up a subscription. And that was pretty transformative. There was great signal that we started to get pretty early on. When I joined the company in, in 2020, that's when we started to really lean in and say it's time to rip off the Band-Aid and we'll go really push hard into the PLG motions. And that's a lot of the story you're going to hear going forward. So we got more aggressive with introducing more packages during that time. We started to experiment with QR codes and saw during 2020, 2021 that that was really starting to take off. And we're going to talk a lot more about that. We leaned in because we saw a big opportunity in the QR code space We did an acquisition that was a big accelerator for us as well. And we started to bring to life this multi-product platform, which had a pretty profound impact on both our acquisition and retention. And you can see how that had a big, big uplift in our ARR over the last 3, 4 years ultimately. So that's the journey, if some— sum up, if you will. Now let's get into a little bit more details on how we actually did that and bring that to life for you. So one important callout is, is that, you know, we— that funnel that I talked about continued to grow, and we have customers and users from 190+ countries. We have millions of users coming on our platform. So you can see that we had a really big opportunity to start figuring out how to convert a lot more of those users into paying customers. And the, the journey we went on was really about starting to bring all of the different functions of the company together in alignment, particularly as you can imagine product and marketing as you're heading down the product-led growth path ultimately. So there's 4 callouts to make here, and then I'm going to hand it over to Kelsey, who's going to go into more detail on 3 of these. So one is, is that, you know, we historically had an enterprise sales-focused marketing team. And we had to rebuild that team, bring in new DNA to really help to juice that PLG efforts that we were going into. The second was, is that we were very focused on figuring out how to optimize this acquisition funnel. And starting to, again, as I said, figure out how we can convert some subset of our users into being paid customers ultimately. We did a lot of work, and Kelsey's gonna go into it, on pricing and packaging. Can't emphasize enough how important that is on the journey. And then we have been constant and maniacally focused on refining, understanding the user experience, both in terms of creating an experience that our customers love, but also figuring out ways that we're able to, to convert more and more customers either into paid packages or upsell them ultimately. So with that, I'm gonna hand it over to Kelsey.

So as Toby just mentioned, we had an incredible opportunity in front of us with the millions of website visitors that we were getting daily. And when they came to our site, they were greeted with what we call the anonymous link shortener. And what that is, is you enter your destination URL, you hit shorten, You get what you came for. We don't take anything in exchange. No sign-up. No introduction to the product. And then users bounced. And that was OK when we were free and enterprise only because that really helps the virality of the bit.ly. But at this moment when we were moving towards product-led growth, that was a big missed opportunity for us to get users into the product. So what we did is we set out to replace the anonymous shortener with a very simple, still free tool. This also gave us an opportunity to do multiple products as an entry point. So you go in, it still says shorten a link, or it'll say create a QR code, or create a link in bio. And then what happens when they hit click set, like shorten, is they get taken directly into the product. And so there's a sign up. And as a result, it was pretty incredible. We had a almost 30,000 free users per day that sign up for our product. 30 to 40% of those free users actually come from that free hook. And more incredible and surprising to us is we saw our conversion rate in product of free to paid also increase. So you might ask us why we didn't do this sooner, because it's a pretty obvious missed opportunity. And one of the biggest learnings we had here is there was just general fear at the organization. It had been around for so long, and honestly, we heard from some of our customers that they thought this was the product. They were like, oh wait, there's a product behind this? And we're like, yes, there's so much more that we offer. But because we didn't have much interaction with them, we were losing out on that opportunity. So we leaned into the fear. Um, product marketing, we needed to make some bold decisions to actually replace the anonymous shortener. One of the biggest fears that we had is the anonymous shortener drives SEO, and it drives this breadth of traffic that would come. So if we make any tweaks to it, we're gonna lose it. And you know what? That happened. We actually saw a decrease in our website traffic. So at first we were like, well, should we pull it back? But this is where we got to our learning about quantity over quality. The quality of our users that were coming to the page, signing up, and and then converting was almost irreplaceable. And we lost lower quality users within that drop in website traffic. So we learned a lot from this experience. And this was probably the biggest impact initiative that we had that helped us optimize our acquisition funnel. So now that we have the users in the product, we focused on pricing and packaging. And as Toby had said earlier, our online channel was relatively young. It was launched in 2019. And when we launched it, there was a lot of fear. There was fear it would cannibalize our enterprise. There was talk like, oh, should we pull it back? And no, we needed to lean into that fear. We needed to experiment frequently and rapidly. And as we evolved the product, we also need to do a lot of pricing tests as well as entitlement tests. So going back to historic Bitly, when we only had free and enterprise plans, our free plan had 10,000 links per month. And at that time, the value of the product was the volume of links. So we launch our online channel, but we don't reduce the number of links in the free plan. Again, a big missed opportunity. Why would our users convert? So now, just to give a drastic example of how much testing we've been doing, Our free plan previously had 10,000 links per month, and now it has 10 links per month. And when we originally were approaching the growth teams like, well, maybe we should restrict some entitlements, again, there was this underlying fear like, well, people love Bitly, and if we do this, they're gonna leave us. But that wasn't what we saw. And as we added more value into the product, we also learned what users wanted to pay for. And we're now leaning in because our users who are now in the product understanding that they can do more with links and QR codes are now seeing the data and the value and the insights that they're getting from those engagements. So big learning on pricing and packaging. We're still experimenting every single day and doing a lot of it, much to our forecasting. I know you like that, Peter. But one of the things that we really needed to do when we did this is it changed the way that we measured success. So if we think about how we were traditionally measuring success at Bitly, especially as it related to new signups and our closed MRR, it was very much within that month, how much recurring revenue did you sign up? So we had a pretty good package online. And then last year, we went ahead and launched an annual-only plan. And it was our very first one. And we did this for several different reasons, but it was much cheaper than our basic monthly. And again, we had a fear that it was going to cannibalize our most— what we thought valuable package. And 2 months go by, we're seeing the MRR continue to decrease and we're like, oh no, what are we doing? And I think Toby and I were even on a train in Europe and he was like, I think we got to pull it. We got to pull it. So we're scrambling to figure out what we're going to do with this starter annual package. We challenged our leadership team to say, okay, maybe our MRR is down, but what's the real reason why we launched this plan? We wanted an entry point that was a little bit cheaper, and we wanted an annual-only plan that maybe had higher retention. So instead of just measuring MRR and looking at success in a silo, we started measuring lifetime value, and it was kind of that next step step in maturing as an organization to really measure what mattered. And it turns out that our Starter annual plan has a much higher LTV. The users are not only buying, they're upgrading, they're in the product, they're discovering more value, and they're retaining with us. So it did cannibalize Basic Monthly a little bit, but it was good for us, and it was good for our users. So now that we have users signed up, users in the product, users purchasing, we looked at the product and we were like, wow, this is a pretty dated experience. Users come in, I don't even see a CTA on this side. It doesn't feel modern. So we decided to have the teams work on a full UX redesign, and it felt really scary. I remember when Toby said that, I was like, I don't know, that's like a lot of work. But we started small and we looked at the simple feel of the product. We wanted to really lean into the value of Bitly, which is easy to use, simple, modern. So what you see on the right-hand side is an updated version of what the app looks like. And what's really cool here is it's a subtle change with the CTAs. But when we launched this, we had a 30% increase in, in-product subscriptions. That subtle change because we were driving more users to the pricing page and we ultimately had a 20% increase in our daily MRR that we were capturing from those users. That was both from our new users who were signing on and upgrading. But we also saw some movement between plans and some upgrades, which was exciting. It was also the foundation for us to build the multi-product platform because we were able to increase the discoverability of more features. That was a big missed opportunity. And through that, our users were able to discover even more value in the product, which is a transition to becoming a multi-product platform.

So, so making a shift. So Bitly had forever been a point solution and a very successful one. But we saw a number of opportunities for us to expand, and we want to take you through that thinking because this was, again, a massive transformation and has really been an accelerator for us going forward. So the first was that we just saw incredible market trends as it related to QR codes. So if you recall on that timeline, we had introduced in 2017 a fairly nascent QR code offering in the product. And in 2020, we started to see that really take off, right? And when the pandemic hit, there was a pretty significant move towards touchless. QR codes became the de facto standard, if you will. And at first we were like, is this a flash in the pan? Is this something that is really going to last? But we kept seeing the numbers, and more importantly, just the sheer number of use cases and the different ways that businesses were now embedding QR codes into how they operated. And that gave us a lot of conviction that QR codes were to, uh, here to stay. Now, I think you probably all know this, but behind almost every QR code is a link. And so you can see how closely aligned, um, our legacy product or core product was with QR codes, uh, ultimately. So that was a big reason why we made the leap into QR codes is because they were adjacent, they were taking off quickly, and our customers, we were seeing a lot of signal that our customers wanted to use us for their QR codes ultimately.

And we also saw a signal that our customers were already using us behind QR codes. So we have some insight not only in direct interviews with our customers and how they're using the product, But most importantly, looking at the breadth of data that we have and asking ourselves, where are our customers sharing Bitly links? Where are their customers or their audiences clicking those links? And what we found is some were being shared via QR codes. So that was a strong signal. But most surprising to us is that we had a lot of customers. And by a lot, I mean a pretty significant amount shortening links and sharing them on the leading link in bio platforms. And we were like, well, this is interesting. This is a pretty strong signal. And then we look at it. It's really just a collection of links on a microsite. And we're like, I think we can build that. So we set out to build it and we didn't know how it would resonate with our users. So we did a quick MVP, went to our users, And then we started to hear some really powerful feedback from our customers. Things like, I like things to be in one system. Would love to have my QR codes in one place with my Bitly links. And probably the most important was, I didn't even know that you offered all of this, but now I will come to your platform and use it all in one place. And all of those trends from our customer gave us high conviction that we were ready to move into this multiproduct platform.

So the final signal is, is not really a signal. It was more about a mindset that we started to create also, which is that, you know, we, we spent a lot of time talking. We have over 550,000 global customers. We have close to 4 million monthly active users on our platform. We have the ability to get a lot of feedback and data from our customers, and we are maniacal about researching and talking and surveying and doing all that. But, you know, as this quote says, is it's like there does come a point where it's also our job to start to figure out where the trends are heading and where the market is going and to really start to push ourselves in that direction. And we've done that with initially thinking about, you know, this notion of a connections platform. You know, all of our products are important tools. That our customers are using to connect to the end consumer. But we're also starting to see a real paradigm shift in the customer journey, and we see a big opportunity to lean in there. And so the moral of this story is really about— it's about being bold, taking chances. And internally, what we're starting to do is to really encourage both our customers as well as employees at the company to imagine the possibilities that can happen if you start to open your mind up and be bold ultimately. So that takes you through the first two areas that we were talking about. I mentioned, you know, that at the top that, you know, none of this can happen if you don't have and haven't assembled a really, really stellar team. And then most importantly that you really unlock that team and give them the ability to go and execute effectively. When I started in late 2020 at Bitly, we decided to do an engagement survey to just get a sense of the sentiment and morale of the company. And what we got back was a pretty discouraging, very low score, that folks were pretty disenchanted. And that ended up actually being a really important silver lining for us because it gave us the ability to not only think about transforming the commercial side of our business, but transform the culture as well. And what we heard a lot from folks really sort of fits into these 3 areas that we started to focus on. One is, is that people didn't feel aligned. They didn't feel clear on their goals. They didn't feel like they were connected to the vision and mission of the company and where we were going. And so we really started to lean in. We simplified the operation in a lot of ways. And we made sure that everybody not only was clear about where we're going, but they felt a part of the process in developing the OKRs and goals ultimately. And that was really important to get everybody to buy in and feel committed to where we were going. The other big piece is, is that, you know, we saw a big opportunity at the stage we were at to make diversity, equity, inclusion a core part of how we were building our company going forward. And as we like to say, We try and build it into the DNA and the fabric of the company. It's not just about diverse representation, but it's also about creating a space where everybody feels like they can come and do their best work ultimately. And that's a big part of our journey and what we're focused on at the company. And the third is, and you've sort of heard us alluding to this, is really creating a culture where people feel like that they are safe to go try things. And we actually We have a term that we use inside the company, which is safe to try. And I think that's really opened people up to feel like they've got permission to try things. And if it doesn't work, it's not the end of the world because we've said it's safe to try ultimately. So those are the 3 big, uh, sort of cornerstones as we were working on building a high-functioning team. And I think while certainly we're all proud of the fact that we've been able to achieve great numbers and revenue and ARR, I take a lot of pride in, and I know Kelsey does as well, in the work that we've done and the recognition that the employees at Bitly have now about it becoming a great place to work. And it's something that, that we spent a lot of time and focus on, but I think it is crucial if you're going to unlock all of the opportunities, you've got to unlock your employee base to really feel like that they can go and achieve and do great things ultimately. Bitly. So that is a really, really big and important part of the Bitly story. All right. And now we'll finish up with some key takeaways.

We're almost done. I will share a little anecdote to what Toby just said about be brave and be bold. I had someone on my team who's been at the company for about 5 years, so seen a lot of change, share with me maybe one of the most proud leadership moments when he said, you know, one thing I really appreciate about leadership right now is it feels really safe to kind of experiment and try new ways of working. And I was like, oh my gosh. We had been trying to build that culture, but to hear that it's resonating and that people feel it and feel safe to try is, I hope, one of the key takeaways that you have because that really gave new life to our organization. And a couple other key takeaways that I'll add for this presentation. Remember to identify where you are on your growth strategy. We're a little bit different. We were enterprise first, and then we adopted product-led, which gave us some unique opportunities. But you might be product-led and going enterprise, and that's also going to have some opportunities for you. So discover those opportunities in your data, In your customers. Get to know how your customers are using your product and what opportunities exist. And adapt to how you might measure success. It might be uncomfortable, and at times you might think and really second-guess some of the decisions you're making. But if you adapt to the way that you're measuring success and learn to look at your business a little bit differently, you might find success in that. Um, actively look for signals for product expansion. This has been a big one for Bitly because We were just a link shortener at one point in time, and there's only so much you can growth hack with a link shortening product. But product expansion is what brings your people in, keeps them happy, retains your users, and hopefully they stay with you for a long time and continue to love your product. And as you're on that journey, take risks and experiment boldly regardless if you are just starting starting out or you're close to $100 million like we are, wherever you are in your journey, lean into the risks and experiment boldly. If you're fearing fear, like if you are fearful, you're— there's likely an opportunity behind that fear. Uncover it. And then make sure you enable and empower your people. Because the people really, really unlocked success for us. So we're not done. What's really cool about this story and gives me chills as someone who's been at Bitly for a long time, it was hard to see 100 million for Bitly, especially when we hit that 20 million plateau. And now we're looking at what's next? 500 million. And through all of this, we see so many other opportunities and doors opening that we're uncovering. And it's really exciting. So, I'll leave with that. I don't know if you want to add anything to it, Lee.

Yeah. We will close up here. We would not be doing just— if we didn't have a QR code that you could interact with. This, if you decide you want to scan that, that will take you through to an annual report that we put out on QR code trends. We are, as I said, a global company. We have 550 3,000 customers. So we've got a pretty good sense of what's going on. So definitely encourage you to take a look at that report if you want to learn more about the explosion of QR codes. And with that, we'll finish up and we can open it up for Q&A. Yeah. Thank you.

I think as a member of the startup community in New York, I'd like to applaud you because I, for For a long time, Bitly had been around and known as kind of a slow-growth thing, but getting in your late adolescence and kicking ass at $100 million, congratulations on that.

Thank you.

But I wonder, the flip side of that is also, since you've been around for 15 years, and you— I don't know how many of your employees have been around for longer than 5 years. When you make a transition like this, you know, you talked about your human resources strategy, but, you know, how much of that has been having to churn your team because there may have been people who were kind of wedded to the old way of doing things and they couldn't make the journey to the new way? How did that end up working out?

Yeah. Well, I mean, what's interesting is in the tech world, there's a fair amount of turnover. So we actually do have two employees, long-time employees that one has been with the company for 14 years and the other 11 or 12 now. But I think the average tenure for us is probably in the 3 to 4 year. So most people have been with us sort of as the new wave of the journey that we've been on. When, you know, when I joined, I think I had said this, there was a burning desire for the company to start to move in a new direction. So I think that's, you know, seeing— being a part of this and seeing the results, I think, has reenergized folks that have been. And we do have some that have been here 5, 6, 7 years as well who seem to be— continue to be excited with the go-forward.

Thank you.

Yeah.

Thank you. I use Bitly a lot, so I think it's the best product of the niche. I've seen that you have a lot of big clients like Amazon, if I'm not wrong. So my question is, what are, in your opinion, the key points, maybe features, that let big clients like Amazon and— yeah, like that— to choose your product? [Speaker] One of our biggest with some of our large clients is not just having user seats, but Amazon uses so many links and they use a lot of QR codes now, and they have, I think, 2,000 groups within our platform. So that would be like teams. So one of the things for our enterprise clients is ensuring that not only do we meet their security standards, that's a must, but ensuring that we have an experience where it can be managed by their, their security team, but also where their teams can collaborate and use different limits and ha— kind of have like that team's expectation where their user seats within it and user permissions. Those make a big difference. But I would not be giving you the right answer if I didn't say our scale and reliability has kept us in the game. And every time our customers talk about build versus buy with a utility product like link shortening or QR codes, they look at the volume and then they're like, wow, that's hard to keep 4 nines with that type of volume. And so that's also been a game changer for having those larger customers with us. Okay, thank you.

Thank you, guys. When it comes to the idea that you guys mentioned around lean into the fear, what preparation kind of goes into deciding to do that? Is there a lean into fear as long as you do this as well?

Do you want to answer that? I'll start. So having high conviction but recognizing why you're fearful. So high conviction that I think this is the right thing to do. It seems like an obvious opportunity. Why are we so fearful? And starting to unpack that and then look for data to validate like, yeah, this actually might be a really bad idea. And if that's the case, test really, really small. But if data is telling you and giving you signal and your customers are giving you signal, I think it's important to lean into it, accept it, acknowledge it with your teams and try. And see what happens, but most importantly, have a safe space in case it fails because failure is where we learn the most.

Yeah, the one piece I would add on to that as well is that if you create an environment where failure is okay, or, you know, things not working is okay, then people don't feel like they have to hold on when the results are not great, and they're, you know, people make good decisions. They sort of say, okay, we tried it, it didn't work, We move on to the next one, sort of thing. And I think that culture is— we're starting to see that permeate throughout all facets of the company where people just have better and better judgment ultimately. But if you have the reverse, then people will hold on much longer than they probably should because they feel like they've got to show that it actually worked. Right. Thank you.

Huge Bitly fan. Oh, good. So when you did— I wasn't— but I'm a pre— I have my own URL and everything, and I was shocked to see that you had the LinkedIn bio feature. So I'm in B2B tech, but I also love the TikTok world and influencer stuff. And so that's what I was like, oh my God. So I'm so curious about what are you hoping— where's your next whitespace movement? Is it more into that, like, individual kind of tools, like ConvertKit or something like that, like subscriptions? I'm just super curious. Yeah, you take it.

I'm happy to. I would say two things to that. One is that we, like you, we see, you know, a huge sort of greenfield whitespace area emerging. A lot of it, as I was a alluding to is around that customer journey and the enablement of that. And I think there are both tools within that context. You sort of alluded to some of those, as well as what we're seeing a lot from our customers is just better insights and tracking and understanding the customer journey. And so we've got a pretty big focus in that area where we're starting to bring more and more insights to life so that you can be smarter as you're starting to think about using our tools and quite frankly other tools as well. You know, we have over 800 integrations, so we're able to bring a lot to life from that perspective.

Thank you. And if you want to talk afterwards about like features. Yeah. Hi. You've got your individual free users, you've got your individual paid users, and you've got your enterprise level kind of plans. How do you guys connect between the individual paid users and the enterprise users? Like looking at people and going, oh my God, you're using this loads. Maybe there's an opportunity for us to sell into your entire company. Yes, spot on. That is up and coming. So on our product-led growth journey, like we started with product-led growth and now we're recognizing that we have a big opportunity to lean into product-led sales and So that's something we're actively working on. Before— I mean, it's a lot to build it into the product. And so we have our sales team that's working together with the product and marketing team to identify some leads in the data that exists today and see if we can validate some of the assumptions that we have, get some movement. And what's really cool is we already have some hand raisers who are doing it. We had a customer just today who had— a couple free accounts, one basic account, and they were a hand raiser to become an enterprise account. So if we can enable that, we can unlock that next step in growth for us.

Yeah, I would just add on to that, that an area— and, you know, one of the exciting things about being at the company is it feels like it's day one all the time. We're now starting to do a lot more of going deeper into the data and getting signals. And both building that into the product so that it, you know, signals and potentially converts people in some way in the product, and as Kelsey said, our sales team also. But we've just started our journey in that particular area, and it's been pretty exciting. Yeah. Hi. So when you were joining the company, It was kind of like on a plateau of growth. My question is, how did you convince the organization to switch the focus and kind of like the heritage, the legacy, and kind of like the friction of the motion that was already in place and the whole team and that kind of thing? Yeah, well, so the super short answer is it wasn't that hard. As I mentioned, you know, the morale wasn't great. There was a pretty good recognition that things weren't going well. So I think there was a real hunger for there to be some changes. And, you know, some of the stuff that we started to work on was already, you know, people had sensibilities around that. There had been some tests in that area. So a lot of this was just more like unleashing and letting people do what they wanted to we didn't have a lot of holdouts of folks who were like, hey, this is going great. We'll just keep going the way we're going ultimately. So I have been at other companies where it is hard. Change management is harder. That was not the hardest part of the journey at Bentley. Great.

All right.

Well, thank you all for joining us.

Thank you.

Have a great rest of your day.