The Secrets to How Flodesk Bootstrapped to $5M ARR in Less than a Year with CEO Martha Bitar

Thank you for joining this next session. We're very excited to welcome Martha Bittar, CEO of Flowdesk. She's going to be talking us through the secrets to how Flowdesk bootstrapped to $5 million ARR in less than a year. As a reminder, please use the Q&A button at the bottom of your screen to drop in any questions for Martha. She's going to be leaving time at the end to answer your questions. Martha, thanks so much for joining us.

Take it away. Thanks, Caitlin. Welcome everyone, and thank you so much for taking the time and bringing your energy. I just wanted to give a quick shout out to the SASster speaker team for putting this together and SASster for putting this community together. We joined SaaStr as attendees last year, and the learnings that we got were so valuable for how we built Flodesk that we're really excited to be here and share our playbook. And I hope that these can be our way of paying it forward. So let's talk about how we bootstrapped Flodesk from $0 to $5 million ARR in less than a year. And it probably makes sense to share what we do. So Flodesk is an email marketing tool that makes it ridiculously easy for you to design emails people love to get. And here's the founding team. So Rebecca, who heads our product, is a designer by trade. She used to design for rock stars like Linkin Park and Rihanna. And Trung probably looks familiar because he's already built a couple of companies and he's already exited a couple of product companies as well. And I'm not your typical founder, at least not statistically. I started my career in sales. I am not a developer. I am a Mexican woman and I did not raise any money for Flodesk. We actually started Flodesk as a side hustle. And yet we are at $5 million ARR in less than a year. We've taken zero funding, so we own 100% of our company. We're growing 15% month over month and we have almost zero churn. So the question is, how did we do it? And I'll be sharing a couple of things from our playbook. I'm sharing in full transparency, hoping that you can grab as much as you can and apply it yourself as well. But it really boils down to one key thing that we did, and it is that we chose our customer. And in talking about how we bootstrapped to $5 million ARR in less than a year, we should probably talk about why we bootstrapped first. So as I mentioned before, we chose our customer very early on. We knew who we were going to build this for. And we also made a decision very early on that we wanted to capture that customer's validation before we got that investor's validation. So we also knew that time spent talking to investors would be time spent away from that customer. So we just decided to optimize for customer time. Early on, and that actually turned out to be our biggest secret. We found founder market fit, and founder market fit meant that we knew our customer very well. And in a way, we also were our customers. So before building Flowdesk, I spent time working at HoneyBook, where I served specifically small business owners, creative small business owners. And Rebecca and Trong were building a business called Gallery where they were selling email templates for small business owners as well. And we were part of this community. We were friends with other creative business owners and we knew their pain because we felt that pain too. And we knew the solution because we would use it too. And that was key to how fast we were able to build this. And one thing we found was just true across the board, that regardless of where you are in your journey, whether you're just at that idea stage and you're coming to get that knowledge of like, what is the best way to start? Or maybe you already created an MVP and you already have it in the product, or maybe you're already scaling, right, and growing super quickly. Wherever you are, deeply and intuitively understanding your customer will move the needle for you. And A crazy story that we had early on as well was when we were launching self-onboarding. This was exactly a year and a week ago. We realized that we needed a website because we couldn't expect people to sign up for a product if we didn't have a website. And typically companies will hire an agency and they'll run some data surveys, right? And we, A, didn't have time to do these. But we also, in a way, knew intuitively what we needed to write in that website. And we didn't create a website. We ended up creating a landing page and just staying up that night. And that website just reflected the questions that we knew our customers would ask and what they wanted to see before signing up for a trial. And yes, eventually we're going to build a real website with many pages and more information. But that landing page, that single landing page converts at 12.75%, which is 10.75% more than your average SaaS visitor to free trial conversion. Right. So the point is, if you know, if you really, truly try to deeply understand your customers, then you're going to know intuitively as well how to resonate with them, what to say, what to build. And it's just going to save you a lot of time. And here's just to break it down further. You have your traditional startup story, right? So it typically starts with a founder who has an idea, right? All of a sudden there's this lightbulb moment and they want to test their hypotheses around that product by creating an MVP, a minimum viable product. What is the least amount that we can build to put out there and get validation? And when they build this product, they typically put it in front of a customer segment. And this customer segment can change, right? Or it might stay the same. And this process goes back and forth a few times, right? You put it in front of your customers, you hear what they have to say about it, and then you iterate based on that and you go around a couple of times. The truth is 90% of startups fail at this point. Like, they just don't make it past this point. And then from the rest, that do, some find product-market fit and then they scale. Now, let's talk about what happens when you have founder-market fit. When you as a founder are your customer, or when you know your customers so well that you're almost in a way building for yourself, you intuitively know what you want to build and you already know who you want to build it for. So chances are you already know where to find those customers that you can call and you can get feedback from right away. So this speeds up the process a lot. And then when you finally build something, you've already had all of that, all of those conversations, all of that validation in the works because you have founder market fit and you build something that people love and then you scale, right? So, so it saves you a lot of time. And I'm going to leave this slide up a little bit more just so that you can see and notice the difference. So for us, once we realized, hey, we're moving really fast and a lot of our friends that founded a company at the same time are not, why? And we realized that it was because we picked a customer that we understood. Then we realized that we needed to get better at this all the time, every day. And by getting better at it every day meant, hey, let's make sure that as we grow the company, we're also getting better Throughout every single team, every single department, that this is a muscle that we're really truly working out. So to do this, we created a workout routine that is just a series of repetitions of things we do every single day so that we can get better at understanding our customers. And here's a workout routine. And it really, I mean, it has to start with talking to your customers one-on-one all the time. And by all the time, I mean every day. Talk to your customers. Every single day and ask them why. And just as important is to talk to customers who already left, who are no longer using your product, and ask them why as well. We hang out where customers hang out. So very early on, we knew that our customers talk to each other online. So we created a community on Facebook where they could have these conversations and we just, we hang out there and we also hang out in the forums where they live so that we can make sure to continue to be always in the know of what they're really thinking and feeling. And we mobilized that Facebook group that we created so that customers can support each other as well. And we're not just offering a one-way support route. We made that Facebook group a core part of our R&D, along with other forums as well. We focused our team around the customer experience and to make sure that that always stayed in alignment. We align the business goals with the customer goals, and I'm going to break this to you down a little further. But it's a lot. And if you are adopting one thing from this presentation, please let it be this. Go home and pick up the phone or pick up Zoom and talk to one customer who recently subscribed and then also talk to one customer who recently left and ask them why. And the reason I say that it is important to ask them why is because if you call a customer and you ask them, hey, what do you want to see in the product? They're going to tell you what they think they need. And, and it's the best type of information that they're available to give, but they don't have the context of your roadmap or how your design principles work. They don't have the context of the rest of the feedback that you're getting. So asking why lets you really dig deep into what is it that they really need. And then once you have the core need, it becomes really easy to find the best solution, an elegant way to build it. And that is something that you, you know how to build and they don't. So one story that I want to share here is recently I talked to— well, it started when the pandemic started and we were freaking out a bit because we saw a dip in usage. And we— the first thing that we did is what we know how to do. And we got on the phone with customers and we started asking them, why they weren't using Flowdesk. And this happened, this was like a couple of days, right, of lower usage. And what we heard from them was that everything had changed so quickly. Some of them were photographers and they were booking things, and all of a sudden they knew that they needed to share some safety protocols and they didn't know how. Some were physical stores and all of a sudden they had to go online. So they weren't using it because they were paralyzed, because there were all of these communication situations that were completely unprecedented and they had no idea how to handle that. And if you think about it, the customer that we serve is an entrepreneur that most of the time they're doing this alone. So they don't have a PR team. They don't have anyone telling them, hey, here's, here's how to communicate with them. So having that information gave us so much color into what was really needed. And then what we did was we partnered with a couple of customers who were already creating their own templates, like, hey, here are safety protocols. Our business is still on. We're closing our doors, but we're moving online. Right. And we created this collection of COVID templates in the platform. And that turned what could have been the really, truly the lowest month for us into our biggest spike to that date. And then up until today, those are our templates are the most used in the platform. So to recap, talking to your customers all the time will help you understand what they really need and not just what they say they need, how to really resonate with them and capture their attention, and how to convert them from customers into true fans, right? Because the goal is not to retain the customer anymore. Like, that's something that you have to do if you want to grow. Right? But the goal is to mobilize your customers so they can be aiding in your growth. And that takes us to customer-led growth. So customer-led growth allows the customer to drive proliferation, adoption, conversion, and retention alongside your company. And the reason why this is something that can happen now and wasn't available a few years ago is that there is a shift that is happening. So in the past, you would see mostly sales-led growth. Why? Because the decision-making would happen mostly at the executive level, right? So if you think of a company like Oracle, you would have executives making the purchasing decision typically before seeing the product and after talking to a sales rep. And then after they would make the purchase, they would have the product implementation and then the rest of the company would adopt it. And then the end user would adopt it. Recently, we're seeing companies that already understand the shift from that decision-making process. So now it is the end user that is making the decision. So we have companies like Dropbox who start getting it right, and they, they create growth that is mostly based on the product doing the work. So users don't want to talk to sales reps anymore. They want to see the product for themselves, and they want to try it before making that decision. So what do you get? You get freemium, you get paywalls, you get in-product gamification. And, and that's what we, we've seen most companies do up until now, or at least the ones that really do get the power of the user making that end decision. And what we've seen already happening is customer-led growth, right? So, so not only does the end user not want to talk to the sales rep anymore, they want to try the product, right? But they also want to talk to other users. They want to see what they're doing with the product. They want to see where they're struggling with the product, like what, what good things and what bad things they have to say about it. And, and in customer-led growth, it becomes really important to understand where these conversations are happening organically, right, so that you can optimize those for growth. And if you think about it as well, just taking it one, one level deeper, we have Gen Z. Right, who is already entering the workforce. They already hold most of the buying power, and 50% of this generation is already entrepreneurs and they're running online businesses. And, and this is a generation that grew up with a phone in their hand. They're digitally native. They're used to talking to each other all the time online, right? So how do they make their decisions? They look at what others are saying online and what they're sharing and what others are using. right? And this becomes the way that they make their own purchasing decisions. So once we realized that if we focused our team around the ideal experience for our ideal customer, then in turn that ideal customer will go out there and share that experience. Once we understood this shift, then it really truly became about focusing our team and then optimizing that experience for growth. And then one thing that we did to take it even one step further, because what happens, we're growing a company right now, we're very small, right? But, but we're adding people and, and we want to make sure that this is a core value that we continue to carry along. So then we aligned our goals to the customer goals. So we're successful when they're successful. That means that every single team member at the company is incentivized to, to prioritize, right, and to center that customer experience. And I'm going to break it, break this part down a little further. So here's how we align our goals. Let's just get in our customers' shoes for a second first. So our typical customer is a solo entrepreneur or they have a very small team. But if they have a small team, it's typically a virtual assistant. They don't have a design team. They don't have a marketing team or a tech team. So it's, it's really difficult for them to find an email marketing tool that they can use. Right. Because even the tools that are out there, they could use it, but they can't make something that's visually on brand. Right. So, so when they find a tool that they can use to, to make the emails that they really want to send, we also win. We gain a new customer. When they find a template that inspires them, we onboard a customer. When they edit the template so they can make it on brand, we give them the aha moment. And this is something that they were hoping for, but they had never experienced before. So when they get this aha moment is typically when they turn to Instagram and they share their story, right? And they share their creation. And this is like the first piece of that first customer interaction that we're tracking. Then, then they add a form to their website, right? Because they want to start collecting subscribers and growing their list. It's the next thing they do and it's the next goal. And, and we make it so easy and that makes our product sticky. And then when they send an email to their audience, this is key because this is our viral loop. We get that viral loop. How? Because when, when they successfully use the product to send an email, then their entire audience gets that email, right? That means that all of these like thousands, sometimes millions of new customers are getting exposed to the final result of the product. And when they see this beautiful email and they notice, hey, this is something that I haven't seen before, I want to create it too. Then they sign up and then they go through this entire flow, right? They hit their goals and then they send an email and they create another viral loop. So this is probably my favorite part because in a way it gets the brand exposed to millions of people every single day just because our customers were able to use the product successfully. So let's keep going. When they grow their list, we grow our viral loop. Why? Because that audience gets bigger and bigger, right? So our viral loop just keeps increasing. And when they make money, we retain our customer and we continue to make money, right? And this is just a summary. We have like a full map of how we mapped our goals. But, but this is just an example so that you can take it home and you can start mapping your own goals and see if this is something that can work for you. So once we started noticing where these organic interactions were already happening, then we knew that all we needed to do was optimize our growth for each of these areas, right? Like optimize all these interactions for proliferation, adoption, conversion, and retention. So let me break it down for you. All right, uh, proliferation. So we listened to our customers, we understood the shift, and we knew very early on that they were already talking to each other, right? That's just the way that decision making works nowadays. So to optimize that, we created a Facebook group on a community, right, where they can talk to each other and find each other all the time. And then when they started sharing their experience on Instagram, right, when they would hit that aha moment, we started reposting that to our own channels. So what this did was it took the conversation that they were already having on social media to a place that we could own and optimize. right, and where we can actually help them better. And then we also, we also started reposting their experiences. So we made it really easy for new customers to find the relevant information that they needed from existing customers. And sharing also encouraged more sharing behavior from new customers, right? So it encouraged that virality and it also gave new customers that relevant information right away. And here's a deeper dive into the viral loop. So very early on, we would get on the phone with customers all the time as well. This is something that we've done from day one. And in talking to new customers, we found out that they were finding about Flowdesk for the most part when they were receiving an email from an existing customer and they were seeing something that they've never seen before. It was, it was very, very well made, very beautifully designed, and they were subscribed to this list before. So they would see that transition. Right. And they would get really creative trying to figure out what they were using. So they would right-click a link to get the URL, right. Or they would reply to the customer who sent the email and ask them what they were using. And then that's how they would, they would find out and that's how they would sign up. So to optimize it, we created this footer. You can see it in the screen that says Made with Love and Flowdesk. And we knew that a lot of customers would turn off other footers because the design would get in the way. So We did a lot of experimentation and we got a footer that was very minimal and would not get in the way of the design. And then we optimized it even further by linking the customer's affiliate link to this footer, right? So now they're even more incentivized. And one thing that's pretty magical is that in the Facebook group, we've seen people ask, hey, do you leave your footer on? Do you turn it off? And there's hundreds of responses that where other members are sharing why they leave it on. And we do have the majority of our members leave the footer on. And this is a key to our growth. Now, when it comes to adoption, typically you'll see companies creating their own help centers and webinars, and this is great if you have a large team, but if you're a startup, chances are that you don't. And also you're missing out on a really big customer-led growth loop here if you're not doing what we, what we eventually found out that was the right thing to do. So what we knew from listening to our customers was that they wanted to talk to each other and learn from each other. And at the same time, we were already seeing that our customers were creating full tutorial playlists on their YouTube channels on how they were using Flowdesk. So what we did to optimize it was we took all of that content and we put it at the center of our onboarding flows. So if you sign up for Flodesk right now, you will get a series of onboarding emails and they teach you everything that you need to know about how to get started. So how to create your first email, how to embed your form, and what you see in those emails is all the customer content. So you'll see, hey, here's a video of how Natalie designed her first email, or here is a tutorial on how Michelle onboarded her form into her Squarespace website. Right. And these brought even more relevant information to them because it wasn't just coming from us. It was coming from other people who were just like them and were trying to do similar things. And another thing that's really important when it comes to, to this shift is that not only are they really good at asking questions of each other, but they're really good at marketing what they're using. Right. So, so this is just another way to optimize that behavior. Conversion. So typically when you have, when you have conversion, you have a company that runs some offers or some campaigns, right? And you might be doing this right now. So you'll see a website and you'll go on that website and it says something like, hey, get 25% off this week only. And then you sign up and all of that is done directly through that company. We've never done that. Because very early on we realized that our own customers were already sharing their experiences, right? So what we did to optimize this for conversion was we created an affiliate program and we gave our customers a link that they could use to share a discount with their audience. And then they would get a free month with this link when, when someone would sign up. And then what we, what we saw was an increase in creation of content, anything from why I switched to Flowdesk to here's a review to a tutorial. Right. And then they would share their link. And, and we didn't ask for that. Right. We just saw what was organically happening because of that shift. And then we optimized it by giving them value. And one thing that I really want to share when we created our affiliate program, because I've worked with affiliate programs for a long time and typically an affiliate program is based or built on exclusivity. So you'll have sometimes even an application that people have to fill and then they may get approved or maybe they don't. And it's counting on big influencers to talk about your product. And this is not what we wanted to build, right? We were betting on customer-led growth and we were betting on the core, like all of our customers, to take part of these. So we made sure that every single customer had an affiliate link, whether they wanted to be affiliates or not. They didn't have to use it. And what happened was pretty awesome because if you look at this graph, so this is going to show you where our affiliate referral wins are coming from. And over 75% of them are coming from small voices, right, from individual customers who are referring their friends, not influencers. So this was key, right, for growth. And lastly, retention. So typically you'll have a support team, you'll have an account manager team. One thing that happened when we created that Facebook group was that now customers would start posting on that Facebook group when they were running into an issue. And, and then the result was that our, our own customers were replying to those questions and they were sharing how they had resolved the issue, right? Or maybe they were sharing, hey, I'm still running into that same issue. Let's work on it together. And it created these really, really sticky community where a lot of times they're not even talking about the product anymore. They're talking about strategy. And I think one thing that's really important here is that small businesses are really underestimated a lot. And one thing we saw when the recession happened is how resilient they are. And I really believe that the key in making sure that they're not churning is being able to put them in touch with each other and reinforce that community. Because if they're able to help each other out with a strategy piece, the piece that's really hard, then their success rate is just— I mean, I can share it. That's a full other presentation, but it's just game-changing. So let's wrap it up with some takeaways. Takeaway number 1: The future is customer-led, and you have to aim for really truly understanding that customer. And it is a workout, and you have to do your daily reps, and it is going to be the fastest way to know how to grow. Aim for founder market fit before product market fit, because it is going to make it easier for you to make gut decisions that are actually going to land, and it's going to save you a lot of time. And 3, don't underestimate the power of small voices. So if you think about it, our entire growth strategy, every single part of it is built on counting on our core customer base to really drive our growth. So we made this decision to drive with inclusion, and that has been key for our customer-led growth. And I wanna bet that that is key for any customer-led growth. And if you take anything from what I've shared today, I know I talk fast, but you'll have the slides as well to reference later on. I would love to know how it goes. I would love to know what works, what doesn't, if you have any other questions. So please share your results with me or your struggles. That's, that's what we're here for. And with that, let's go to Q&A. And I think I'm going to stop sharing my screen as well, just to make it a little easier.

Hey, fantastic, Martha, that was wonderful. I'm really excited. We've had some really great questions coming in. We've been fielding them behind the scenes here, and I want to kick it off with one of our attendees who asked, um, just right off the bat, you know, you talk about how the affiliate program for Flodesk was and has been so instrumental. Um, what was the best way that you found to create an affiliate program? Any advice that you have for somebody that's looking to create one of their own?

Yes, yes, a lot. Okay, so we could go, we could go into the technical aspect here and we can go into the strategy. Let's probably do both. So from a strategic perspective, I just shared these, but I'll reiterate it. Make it inclusive, right? Open it to everyone. You never know where the big wins are going to come from. And, and we're in a world where it's every single person is connected online, right? And they want to be part of this growth. So I would open it to everyone and then As far as encouraging people to share, we would start reposting a lot of the content that we would see out there and then sharing it via email with our existing customers. And then they would see that other customers were already creating that type of content. So one thing that happens with these customers talking to each other shift is that if you think about it, it creates this demand for that type of content, right? So the savvy businesses are going to know that it's going to be really good for them SEO-wise to have this content. So if you also educate them a little bit on why is this really beneficial to you as well to have this type of content shared out there, then they're just going to grab them and they're going to run with it. And then from, and from a, oh, another thing that we did that worked really well was we created an affiliate success kit. And this is just guiding them through, hey, here are our top differentiators. Here are some images that you might use. It is okay to share, and here are some reasons why you might want to share, and here's how to make your posts even more SEO optimized, right? So things that we know are going to be valuable for them. And then from a technical perspective, we chose to work with a tool called Tapfiliate, and the reason is because it integrates with our SaaS management system, but They're pretty easy to use. And I mean, I'm not— I already shared I'm not a developer, but our developers were able to implement it pretty quickly and they have really great support docs. But just make sure that you put your layer of design on top of it because the experience of sharing should be something that they're really excited about. So for example, we have in our product, it says Share Flowdesk, and then these like wing emoji to make it really exciting. And then we're letting them edit their own code so they make it their own. So just try to focus on what you know that experience should look like and then, and then give it to them, hand it over.

Amazing. And you actually answered a question amidst answering another question. One of the attendees had asked which platform you recommend using behind the scenes. You mentioned TapAffiliate. Additionally, we got a question right as you were speaking, which is perfect timing here, around, you know, when is the right time to start an affiliate program? Is this something that you think a startup should have right out of the gate? Is it something they should think about adding later? Like, what would you, what would be your recommendation?

Okay, that is a great question. So I would do it right away. We, we did that as an experiment, right? We didn't know what was going to happen. So we, we remember how I share that we created that landing page that we currently still have. If you go to flowdesk.com, you'll still see that landing page. We created that landing page in one night and then the next day we launched. But one thing that we really did spend time on was that affiliate program and making sure that it looked great. And so, in fact, we spent a lot more time creating that affiliate program than even our landing page. And what happened was we launched and then the next day I remember Rebecca Truong and I had set this alert for Flodesk on Google Alerts, and all of a sudden we wake up and we're getting all of these Google Alerts, right, of people that are already creating content and sharing and building full tutorials on YouTube. I'm getting like— I had 400 support tickets in my inbox. This is like, this is unreal, right? It completely went viral up to the— up until the point where service crashed. And then that's another story because there's like trauma still there. But, but yes, we decided to create that affiliate program very early on, like from day one, day zero, before we even had the landing page. And what happened was that it was able, because of this customer-like growth, it was able to just take a life of its own, right? And grow at its own pace. And had we not have these, we would not have ever discovered that this was something that, um, yeah, that would work for us. That's a great question.

Yeah, I get really excited. We have another question here. No, I know you can tell that you're passionate about it. You can tell that it's been a catalyst for a lot of growth as a result, most likely. Um, we have another question here from an attendee asking, um, can you expand a little on that initial comment of choosing your customer? I would love to be in a position to choose a customer. Was it from an already existing relationship? Like, how did you make that decision?

Yes, that's a great question. So I think it's twofold. One is choose someone that you understand, and if you don't understand them, then work that workout routine to understand them. So for us, we, we chose a customer that we understood, right? So we were already working with creative small business owners. We were serving them for a while. So we knew what their pain was. We were creative small business owners as well, right? But then the other piece is also choose a customer and then focus on that customer, right? So one thing that we see all the time, especially at early stage startups, is that you know the customer that you're building for. And then all of a sudden, this massive company with like big bucks comes in and they tell you, hey, can you build this for us? And you're tempted to build it for them because it's going to make you money and it's going to give you a runway. And that's most of the time. I'm sure there are exceptions, a mistake because it's going to distract you. Right. And maybe, maybe it's going to make it feel like you're getting initial traction, but you're not because it's not what you initially decided to build unless you're changing that entire customer segment. So, so, so try to stay focused. When I say choose your customer, pick a customer that you understand, work hard at understanding them even more. And stick to that customer.

Gold, gold, gold, gold.

All right.

Next question here. And this is a good one. How much time and effort is put into managing your Facebook group? What does that look like?

Okay. So, uh, um, not a lot of time and effort into managing our Facebook group. We do have one, uh, full-time member experience associate that will jump in and moderate, right, and try to do some community activities. But the beauty of customer-led community is that they manage it themselves, right? And I invite you to join it. It's open to anyone. Go on Facebook and find Flowdesk Insiders. You'll see that we're not participating in most of the conversations and That is what makes it not only beautiful, but also really valuable because one thing is to have those one-on-one conversations and to hear what your customers are needing. But it really rounds that feedback when you're able to see what they're saying to each other when you're not part of the conversation. Good things and bad things, because trust me, like sometimes you just have to see the bad things and just sit there and say, okay, I can't build that right now. And that's okay.

No, that— and that's good advice. A lot of people build those groups and when they see the critical feedback, they're sort of at a sort of a panicking point. So to know that you welcome that feedback and also acknowledge that you have a roadmap for a reason, it's encouraging, it's inspiring. Um, another attendee asked, um, how do you— how have you differentiated yourself from your competitors in the email marketing space? I'm sure, um, I, I know as I'm going through, glimpsing through all these questions coming in, a lot are around this space of email marketing. It's been around, it's been done. Like, what is the differentiator for Flodesk? How have you guys done it?

Yeah, so this, I have to say, also comes back to choosing our customer and knowing that customer and then building for that customer. Because when we were starting, we knew that if we focused on ease of use and really gorgeous templates— and I'll elaborate on that in a second— we would, we would make it right. Like, it would work. But every single time that we talked to someone who was not our ideal customer, they wouldn't get it. They'd be like, why on earth would you create yet another email marketing tool? Like, these things are coming out every single day from like all angles. And every single year you have that article that says email marketing is dead, no one's emailing anymore. And then every single year you get the stats and it's just growing. And now we're seeing this massive shift of companies, not just small business owners, like across the board, even— anyway, going just completely online and it just keeps growing. Right. And we see it with our stats and we see it with other email marketing competitors right in the space, which we love our competitors. We think they're crushing it too. But we knew, right, because we knew our customer, we knew what they were struggling with and what they were struggling with was they were using other tools, trying to create really, really on-brand emails. Right. And Let's just talk about design for a second, right? I think that we've entered a new age of design where there's a higher standard, right? Adding an image and some basic font and like random spacing is not good. It doesn't look good anymore, right? Like you're selling, right? Or you're marketing to customers who are seeing getting emails from Airbnb and Anthropologie and Urban Outfitters, and they, they see that, right? And you're competing with them. And as a small business owner, you have to fight through that noise and your design has to be empowered with that. So, so our customers were using other tools and then they were needing to hire a designer, right? Or they were designing something in Canva or Photoshop and then adding it, and that would just completely mess up the email and their deliverability. So the biggest, really, truly, it's that simple. But the biggest differentiators are just how easy it is to use, especially now that you might have to turn your physical shop into an online business like overnight, right? You can just go up there and you have complete autonomy. You just, you do it on your own. You don't need anyone else from your team and how you're able to create the result that you really want, right? That really, truly converts and people are excited to see and to get.

Amazing. All right, next question. This one's a little bit longer. So one of the attendees asked, it seems founder market fit has a know-how dimension. Essentially, you understand their operating reality, what your— how your customer operates the business, and there's a sense of almost social connection between you and the customer. And you may know a lot of the folks who are your target customers. This attendee asked, how many of your first 100 customers already knew you?

Okay, I love that. I would say maybe 3, maybe 4. And that is the thing that was the most surprising to us, that all of a sudden we were getting these emails from customers, like from our first 100 customers who we didn't know. I knew about them because again, we were part of the community. But they didn't even know me, right? It was something that later on we would say, oh my gosh, we had somehow heard of each other, but most of them didn't. And the key here was we weren't driving that growth, right? It wasn't me sharing it on my personal blog. It was Customer A finds it, sends an email, 20,000 people see that email, right? So from 20,000 people that I probably don't know, all of a sudden a couple sign up and then they send the email, right? Or Customer A shares a blog post saying, hey, here's what I'm using now and I really love it. Here's the code, right? Because we had that affiliate link from very, very like day one. And then their audience joined. So I didn't know these people. Now I do. And now, I mean, we're friends, but not at the beginning.

That's amazing.

All right.

This is a tough question. Warning in advance. And I'm kind of joking here. Are you planning to raise capital in the future? Someone sounds interested here. Debt or equity and why? What are you thinking about the future?

Yeah, well, okay, so we have a lot of friends in the industry that have the ability to become investors, right? And we explored these conversations because we really wanted to just get these people in somehow, but it really doesn't make sense. Every single time we have that conversation, it doesn't make sense. Why? It would be distracting at this point. We don't need it, right? Like cash is not something that's holding us back from growth. And then if you really think about it, and this is probably more of a personal choice, but our customers, small business owners, are building their own companies every single day without having any funding, right? So there's also something that strengthens that connection, that relationship, by doing it the same way that they would do it.

Love the answer. It's fantastic. One more question here that we have. Do you have any salespeople? This is a good question. Or is all of your growth through self-service customer conversion?

Yeah, that's a great question. So we don't have any salespeople. I mean, I'm a salesperson, but I'm not actually involved in the selling process. And yes, it is 100%. So if you think about that, one of the earliest slides that showed you sales-led growth shifting into product-led growth and now shifting into customer-led growth, So if you think of the end user that you're selling to, it's likely that that end user is now the decision maker, right? So if you have that, then, then you can really truly drive that growth through the product, right? So they'll, they'll come in, they'll self-onboard, they'll sign up for a trial, and then they'll see the paywall and then they'll make a decision to join. If you really want to take it one step further, which is what we're seeing already and what worked for us really well, optimize it for customer-led growth, right? So your customers are really truly your advocates and they're the ones that are driving these waves of growth. I mean, but no, no sales, no sales team.

That's impressive. Very impressive. Um, another question here.

How did you keep up with the growth of your revenue and your company?

$0 to $5 million in under a year is very, very, very fast. What broke?

What didn't break? Oh my God. Okay, now I have to share it. So early on we saw— this was probably October, I would say. So it was about 2 months after launching. And let me remind you of one thing. We, we started Flowdesk as a side hustle, right? So we were all full-time employed. So we're building it on nights and weekends and the growth as you said, just started, started just massively growing. And then, sorry, I saw a comment and it was really funny. And all of a sudden we saw that growth, right? And one day we're all at work at our full-time jobs and we're getting these pings, right? It like what started as emails became customers texting us saying, I can't access my account. And then we realized that we were down. We were completely down. We crashed. What happened was that our database was set for auto-expand, but it happened so quickly in one day that it blocked itself from actually fulfilling that auto-expansion. So we crashed and we, we couldn't really do anything until later that day. And it took us a while to get back on. And I am not going to lie, I thought we were done. I thought, okay, well, that lasted a good few months. Like, we're— it's over. And what was surprising was that the next day we were tagged in all of these Instagram posts. And I was thinking I was really, really struggling to open them because I thought they were going to be just hating on us. And eventually I just got strength to see them. And I remember it was Jessica from My Style Vita, the first one that I saw. And she said, oh my gosh, you guys, Flowdesk broke the internet. You have to go sign up right now before it's too late. And here's my link. And that was just the same reaction that we got from all of our customers. And very early on, we, we were, we were very supportive, right? When we had these these things and when things kept breaking because they kept breaking for a while. And I think what was key was understanding that things are going to break sometimes and that's okay. But it really was how you handle it and how you take accountability for that. And in the end of the day, we felt awful because we knew that these customers were putting their trust on us and they were— this was critical, right? For some of their campaigns to not go out that could be really detrimental for their business. So we just, we came on the group and we did a full video and we shared in full transparency, like, here's everything that went wrong and we're so sorry. And here are all the things that we did already to make sure that it doesn't happen again. And we held ourselves accountable to that because we have, I mean, that's in the end of the day, we're doing this for our customers. If there's no customers, then there's no us, right? So we have to always make sure that we're optimizing for that or showing up for that.

I remember that time very well too.

Yeah. Um, yeah.

Yeah. One more question here. We've got, um, coming in. How much did you talk to potential customers before launching?

Yes. All the time. Like that is, that was, if you see it's number one on our workout routine, that is something that we did every single day. And by every single day, we would have like 5 to 12 meetings every single day and it's doable. And we were doing it after hours, right? Like after work hours and on weekends. And a lot of this feedback was brutal, right? One thing that we decided very early on was to encourage very honest feedback. We didn't want to hear praises. We wanted to hear what was not working. So, so we just went through the brutal, brutal feedback and we had months of that until we finally had one potential customer cry saying like, this is exactly what I need. And I can't believe that I'm not using it and I'm struggling so much. And she was trying to launch her list. She had been struggling for 4 months trying to use something else to use her list and she just couldn't do it. So that's when we knew it was time to start building, but we didn't even start building until we got to that point.

Next question here coming in. Can you please explain your pricing strategy?

Yes, of course. So if you, if you think about— so first of all, I'm going to tell you it's very sustainable and we've done a lot of financial scenarios and modeling around it. And one thing that we, we tested as well was should we be having add-ons and Oh, like there are some things that we could create that we could just charge for. And in every single scenario, it doesn't really add up to anything significant and it just takes away from creating value. Right. So very early on, we realized that we want to, we want to make sure that we're not having a free plan because with email marketing, that becomes really detrimental for a lot of your legit users. If you get a lot of spammers taking advantage of the free plan. We also knew that it just wasn't our business model, right? So we've never had a free plan and not having a free plan actually allows us to have a more accessible pricing for the long term. And then another thing that if you think about with email marketing is that the pricing in the industry is a little outdated, right? Based on what people are actually using. So imagine if you were starting a website and all of a sudden your website provider tells you, hey, I'm going to charge you more if you start getting more visitors, right? Like, yes, like there are costs that do grow in the backend, but they don't grow at the, at the rate where you can't keep an accessible price. And if you think about the target market that we're serving, we can't just make it accessible in terms of ease of use and the design piece, but it has to be accessible when it comes to pricing too. So we just, we did a lot of experimentation and analysis, and then we came back to what we knew was something that we could sustain long term that was also going to work for customers. And by choosing to not do a free plan, we were able to afford it.

Fantastic. If you could go back to the start of this journey and give yourself advice in that season when you were starting Flodesk, what would be some of the biggest advice that you would give yourself at the, at the kickoff?

Yeah, I would think probably the biggest one is to not freak out about every little single thing because I've gotten better at that. But oh my gosh, it was just at the beginning, every single time that something would go minorly wrong or when we crashed, I really thought that it was doomsday and it was an end. And that is just not like— it's not healthy, right? It's not physically healthy, it's not mentally healthy. And now that I mean, remember, we've only been doing this for a year, so I can't even say that we've been around for that long. But now that we have a little more experience, I realize that if you really want to build these for the long term, if we want to be around like 20, 50 years later, we have to stay sane. So I would probably tell myself, like, in a very personal way, to, to shake it off and just focus on what I can control, which is something that I heard a lot of times. I just never really applied as well as I could. Amazing.

Well, Martha, Natalie, we're unfortunately out of time. You guys had so many questions, but thanks for filtering through as many as you could get through. Um, and thanks so much for joining us. We will see you guys next time.

Thank you for having us. Talk soon. Bye.