Close - Focused CRM does $50 million a year

We're probably gonna end the year at the $50 million mark plus in terms of revenue. We knew we won't out-fundraise the big boys, so we have to be smarter, more focused. We are still today the best CRM when it comes— if you communicate a lot and deeply with your customers, Close is the best tool for that. Confidence really is manifested by how many good— to how many good things you say no to.

My name is Andrew Warner. I interview entrepreneurs about how they built their businesses. And joining me is someone who I first interviewed in 2013. That's about 12 years ago. And back then there was this feeling that if you had good software, or frankly, if you were a software maker, if you were a tech company, you would never sell. And this guy comes waltzing onto the stage and he goes, not only will you sell, you're gonna wanna outsource your sales to my company. And businesses that we know, that we know of were outsourcing their sales to him. Then he got really good at it and he said, you know, there needs to be better software CRM to enable this type of process. And then he went out and he created it. And that software is called Close. We are doing a follow-up conversation and there are a few things that I wanna cover here today. First, now that we're no longer trying to be persuaded to sell, he's a guy who's seen people sell so many times on his platform. We're all eager to find out what's working that would give us an edge in selling human-to-human selling, not human-to-webpage, uh, buying. The second thing I wanna find out about is how he made the switch from services to sales when so many people who are in the service business just get so stuck down in that. And then, um, there's one problematic thing that I don't know how to talk about, and that is that his competitors, 2 of them specifically, are way bigger than him. I don't know how he's gonna catch up, and it feels a little disheartening to know that we're in a world where the giants are much harder to, to take down right now. And maybe he doesn't need to take them down, but I still feel disheartened. We'll talk about that. And of course we'll talk about AI and how AI is going to impact sales. Steli, you know, the first thing I'm gonna ask you, what's your revenue right now? You guys have really grown a lot.

Yeah, as you were just saying, you know, the first thing I'm gonna ask you, I was like, what was the first thing you would always ask? And now I'm like, oh yes, yes, I remember people, founders would shake in their boots, like everybody was nervous to talk to you. What a great throwback. So for us, we're, we just surpassed $45 million in revenue. So we're probably gonna end the year at the $50 million mark plus in terms of revenue.

Dude, the other thing that I remember about you was at some point you raised money, but you said, we do not think like a venture-funded company. We wanna make a profit. I wonder if that attitude helped or hurt you. Like it's, there's a period there where I thought maybe your, your pride in that was keeping you from spending money that would allow you to grow. What happened with that?

So we actually, we raised a tiny angel round when we were doing something completely different. And then we wanted to raise more money when we pivoted to Elastic to outsource sales as a service agency. And then when we pivoted to Close and nobody wanted to give us money, nobody wanted to compete with the big boys in the space. And so we became profitable. We decided to be profitable. And that experience actually made us go, we don't wanna have to ever go through this again. Let's not rely on other people giving us money so we can exist. And survive, let's actually just be profitable, right? And then be in control of our own destiny. So we've been growing profitably for over a decade now. We never went back out. It's funny when you don't want money, they are throwing themselves at you. There's not a day where I don't get, you know, 20, 30 emails from VCs and private equity firms and they're getting more and more creative in how they're trying to get in front of us. But I do think that It helped us be more focused. That restraint helped us be more creative. It made certain decisions easier. And in hindsight, for us, it helped us because we knew we won't out-fundraise the big boys, we won't out-spend them. So we have to be smarter, more focused. We have to hire people that are more exceptional in terms of their talent. And I think it ended up helping us sort of survive in a space where most competitors, New CRMs could not, or they would all hit a ceiling at the $10, $15, $20 million mark and then sort of slowly decline. I saw many new CRM entries go, go that path.

Give me an example of someone like that who, because they didn't have your bootstrapping, gotta make a profit, gotta be hustling mode, went outta business.

So I don't wanna name a name because they're still in business and so I don't wanna, I don't wanna throw—

Don't mention them, but talk about them. I wanna, I wanna see a specific thing that they did, they, or that they, couldn't do that you did because we outcompeted them, we hired better people. It feels a little generic, but I know that there's something specific. Yeah, yeah, yeah.

So I'll give you something very specific. You know, there's a, there's a company out there, they raised over $100 million, right? Over the years. And at first, what were they focused on? They were focused on small and medium-sized businesses and they actually focused on a specific platform to be really tightly integrated with. And so they got a lot of traction in the SMB space. Their product felt very native to that very big platform that would bring them a lot of small businesses. I think they were doing really, really well, but as they were raising more and more money, you get more pressure to drive more revenue, more growth. And in the SMB space, one of the problems is you deal with a lot of churn with small accounts, very hard to grow at a certain degree. You know what brings great big growth is bigger accounts, enterprise-level deals. Also, you can hire lots of salespeople and force function that growth, right ahead of where your product is. You don't have to be patient like a Mailchimp or like us where it takes many, many, many, many years. You can just like hire a ton of sales reps and go out to bring in some big deals and your revenue can make massive jumps. And that's what they did. And so as they forced their way, as they got forced to hire some enterprise-level executives, build a big sales team, bring in larger clients, what ended up happening is they, for short-term, maybe for 2, 3 years, they did sharpen their growth curve, but all of a sudden the product got, you know, more, more diluted. People in the company were less and less aligned because the, the early people that really loved the product and the focus didn't, didn't love now getting sort of big lists of random features to close a big enterprise account and just hurry and build it. And we don't care how it works or if it works really well. We just need the feature to to be done so we can close this big account. And so it creates all kinds of misalignment in the company. There's no more focus because the company was saying, well, we wanna serve the small ones, but also the biggest ones out there. And so it just waters down the product, it waters down the focus, then becomes less differentiated. And then as a company, employees, all that, it just, you just start becoming more, they started becoming more average, more— less focused, less sort of standing out in a specific niche. And as far as I can tell and hear about, they, you know, they struggle now. Although they had gone to sort of $20, $30 million revenue, they've declined back to $20. That's always really painful to do, especially when you raised $100 million. And now they're in sort of this space of trying to sell, but they're, you know, they're not as hot anymore. And it's just not clear what's gonna happen with that company. And I do think they had a great start, but they sort of went down the typical, we raised a shit ton of money, so let's go in and go and get bigger and bigger customers. And so they lost their focus.

Okay, so then on the other side, you've got people who did break free, like they raised a bunch of money, they actually are big now. And I find that a lot of them are overly clunky because they put too much into their tool. And so yes, they're serving enterprise. Yes, they're going after startups. Yes, they're going after Everything in between. And the reason they're succeeding is because they gobbled up all the integrations. And so you sign up for something like Grain, uh, which is a note-taking app, and suddenly it says, do you wanna send this over to one of these big, uh, CRMs? You sign up for Granola, same thing. And now for someone like you, I don't see Close being integrated. I don't see Close being essentially promoted by all these tools. How do you survive in a world where they're that far ahead?

Well, one, you have to be exceptional in certain things that matter deeply to a certain amount of customers out there, right? If you're just like as good as them, but maybe slightly nicer in an area, if you have some nice-to-haves, but you don't have a killer feature or you're not significantly better at certain things that people really care about, you're not gonna last. Like you need to have customers. I'll give you an example. Our biggest customer is, I don't know, maybe like close to 1,000 sales reps on Close, right? They're paying us millions. They're big. They've grown quite to a large, large company. That's not how they started with us. They started very small, right? They started with like 10, 15 reps. Most customers that start that small will not grow to that size and still be our clients, right?

Yeah.

Many do, but most won't. Here's why. They have to go through a lot of pain of staying a Close customer, dealing with all kinds of features we don't have. In all kinds of difficult workarounds. But the reason why they do is because the productivity gain we give to each rep is so high that to them it's worth the pain of all the features, enterprise-level features we're lacking. Now that's not gonna be true for all big clients, obviously, right? But you, you need to have some of these things that are so much better that the things you are lacking, customers will work around. They'll eat that little pain to get that benefit.

And the thing that makes you so unique is, I don't know if you still say zero data entry, but the— or zero manual entry, but the thing you do is you say, I don't want salespeople to enter any data. By removing that, everything gets cleaner in the database, and then also they're more productive. And that's the thing that you focus on.

I think that's a secondary effect of what we focus on. I think the starting point where we were different from everybody else was, and still are, is that we said, If CRM is sales software, sales at its core is result-driven communication. So it has to be communication software. So we were the first to do, uh, VoIP calling out of the box so you could make calls and receive calls in your CRM. We're the first to do 2-way email sync. Now it seems so banal, but like back then you had to forward email threads to your CRM and it showed up in some like PDF attachment or something. It was terrible. So we did a lot of communication things first, and we are still today the best CRM when it comes— if you communicate a lot and deeply with your customers, Close is the best tool for that, the best CRM for that. Now with AI, we're gonna be able to really deliver fully on the promise that you mentioned, which is that we just want you to focus on building relationship, talking to your prospects and customers, coming up with solutions, negotiating with them, and then all the manual data entry, all the follow-up work, all the data work should be done by your CRM for you. So you don't do your customer relationship management in Close. Customer relationship management happens by Close. The software does that, the management piece for you, and you just do the communication relationship building.

I get that. And really, I, I do use Grain and I use Granola, and I'm sure I use others. The thing that I like about Grain is at the end of a sales call, it gives me analysis on my sales. And I love that kind of thing. As an avid chess player, I don't think I go a single day without playing multiple games of chess. One of the things that I love about chess.com is at the end of a game, it analyzes every Every move and it tells me what I could have done. And you start getting the same feedback multiple times and you realize, okay, I'm not gonna make this stupid move again. And the same thing happens there. But I realize Grain knows that I lost the sale. It, it tells me what I could have done to get the sale, push a little bit harder, and what I could have done to maybe follow up, make sure to schedule a follow-up call on the initial call instead of letting it go. And I just have to think, if only it was a CRM, it would be able to move that card over on the Kanban board for me, because if I'm happy I wanna go and service, like follow up with the customer. If I'm disappointed, I wanna think about it. I don't wanna go back in and, and move a card. I always forget. Um, so I get where you're going with that.

All right.

The big takeaway though is, look, if there's a lot of competition, you have to say, what is it that I'm focused on? And just be there. And for you, it was this SMB market. It wasn't enterprise, even though enterprise is, is easier to get and the churn is less dramatic. But How do you resist it? How do you, how do you not say, you know, I'm competing here in a world where I could see these people are getting really big. I, I should change. I should go after maybe not enterprise, but let's call it enterprise-y, these little companies that feel bigger. What, what happened?

I think we had a great, a huge benefit in the amount of experience we've had as founders to then truly understand how confident you need to be in understanding who you are and who you aren't. We knew when we launched Close, we are not interested in enterprise sales. We're not interested in that kind of a customer. We're not passionate about them. We're not knowledgeable. We don't have any edge in that space. And so we are just gonna say no to that money because there's other money to be had, right? And I think that oftentimes, especially in the early days as founders, we are very insecure. We want great success and we project confidence, but we actually deep down pretty insecure about like constantly full of doubt. Is this the right thing? Are we missing out? Am I making a mistake?

Yeah.

Am I making a mistake is the sound, the background soundtrack day in, day out, right? Like, am I making a mistake right now? And so when opportunity comes to founders, oftentimes they're very easy to change their mind or to sway them in a different direction just because some VC emailed you and is saying, oh, if you guys focused on mobile, I think we would invest. All of a sudden you change all your plans or a big customer comes to you and says, we would buy this and we would be worth many millions and wouldn't it change your life if, you know, Coca-Cola or whatever it is, you know, Procter& Gamble or Chase Bank was your client and the founder, because they're afraid, what if we make a mistake and oh my God, maybe this would be the big thing, the big breakthrough. Right. They just change the direction, change their plan, and they don't honestly calculate, can we truly win here? Do we believe that we can really nail this, that we understand this customer better than anybody else? And this really aligns with our strengths and our direction. And so too many times we make these little compromises because we're not confident enough in knowing who we are and who we aren't. And confidence really is manifested by how many good— to how many good things you say no to, right? Are you really confident enough to say, to reject ideas, reject business and say no to things?

Well, then let's look at a counterexample. HubSpot, another CRM, really big. They say yes to everything, right? They will do websites, they will do email marketing, they will do your Calendly, they will do everything, and they've done really well. Maybe the counterexample shows that if you would've made the leap, you would've been okay. Maybe you would've died like this other company that you mentioned, but maybe if you, maybe you could've made the leap to there.

Maybe, but maybe not. So I'm not convinced, right? I do believe that there's counterexamples to what I just said. But a lot of times when I look under the hood, even when the counterexamples, even in those companies that do sort of everything for everybody, like even monday.com is a great example of like project management, but it can do anything and it's everything for everyone. Even in those, when I look under the hood to understand a little bit better the story, I do find great focus in the early days and saying no to a lot of things. HubSpot is a great example. When they went into marketing tech, they focused on inbound marketing and specifically organic SEO and content, right? And They, and that was a tiny market when they first started, but they really got great at it and they really sort of became, collected an incredible amount of search volume. They didn't build a sales team. They didn't build a massive ecosystem like Salesforce did from day one to sort of go enterprise. They stayed small and mid-market and they focused on one motion above all others, which was content, organic search, content, organic search. And then when they decided to go after Salesforce, Again, they didn't hire a massive sales organization as step one. They just shifted their superpower, which was content. And for 2 years before launching a CRM, they just flooded the world with incredible amounts of sales content to capture all that traffic and all that demand. And then they launched a free tool first, which is a little email notification tool. I don't remember what it was called, but it was great to like notify you when some lead in your Salesforce instance was looking at your blog post or something, right? Like to know the right timing. And they got, and it was a free tool, a Chrome extension, a Google extension, and they got like hundreds and hundreds of thousands of sales reps to download that and use it. And then they launched the CRM. So still I feel like they, they used their strength and they had one big focus as a through line. Today, as they scaled and it became bigger and bigger, they eventually, you know, went down like, let's just become Salesforce number 2, right? So they're, they're doing a lot more things that Salesforce was doing. And that's also the direction that a lot of other things. are taking in their company and product. But when they started, they were pretty focused on like one channel that they really dominated.

All right, that does make sense. And I do, the thing that's disheartening for me here doing these interviews now so many years later is I do feel like there is like the ClickUp effect. Company raises a ton of money, then does every single thing, crowd out the space, and it's It's not even an exciting story. It's not exciting like the way that the Basecamp story is exciting in that you can see a few people with an idea and the creativity to come up with a way to get customers and a new way to think about something that had been solved before. And so I don't wanna interview the founders of ClickUp. I honestly don't even know their names, nothing against them, but I don't aspire to be like them. I don't aspire to have their lives. I don't get curious about them, but I also have to accept ClickUp took up a massive amount of mindshare. They do have a lot of users, and that's the part that's disheartening. And I don't wanna see companies like Close get drowned out by that. And I don't wanna interview the future of tech and the future of startups if it's all the next ClickUp.

I, I—

what do you see?

Yeah, I hear you. I don't, I don't see it that way. The, the way that I look at things is there's founders and companies I love and I get inspiration from and I'm curious about and I wanna know the stories and there's companies where I clearly go, you know, great job. You know, I applaud silently in my mind. Wow, great job. But I would never do this and I don't wanna live this life. I don't wanna run a company like that. And this is not inspiring to me, but I see why it worked. And I think the trend has always been, and to some degree I assume it will continue to be for a long time, of this sort of like— People want products that are really, really great at solving a certain problem. And then there's too many products because there's too many problems. And then customers will go, I just want one thing that does it all, even if it does it a little less brilliantly because I can't handle having 20 different products to solve this. And so the pendulum just swings back and forth between what is getting a lot of heat and what is getting a lot of attention, what the desire and hunger is from customers. And over time, I think that a ClickUp and even a Monday.com, they came in a, in a time where, or they started growing in a time where the, the, the ethos in software was do one thing, do it really great. Only the Salesforces and the very big enterprise tech can afford to have a shitty product that does it all. But let's just—

Right.

And then they went, no, let's just do it all then. Like, what, what if we just try to give the pro— the promise that we'll deliver to a non-technical A business owner is you can buy one thing and it will do your project management, your calendaring, your this, your that, your everything. And so we give them that peace of mind of thinking, ah, I just have to buy one thing and I won't have to worry about this anymore. It's just too compelling of a promise to not keep coming back, you know, and attracting a lot of customers. But I agree with you. Is it really what I aspire to do? I see all, I see this story all the time of like, some person that came up with some fad idea and sold a million tokens of something and made a ton of money and then it all collapses. And I always go, wow, what a wild story. But I don't want that. I don't, I don't want it. But also I can't, it's not in me. I'm just not wired this way. I want to do something I really enjoy and I believe in and that is fundamentally good in my own estimation. And there's going to be a market for that forever. And there's going to be a market for people that do the exact opposite of what I do. and still succeed with it, at least for the short term. Okay.

I like the framing. You're saying, look, Andrew, there we've got 2 different types of companies. And the way that you did it is, uh, the way that you broke them up is the I do everything versus I do one thing. And the I do everything is multiple CRMs that also include, um, like a calendar booking service and a website, right? Versus Calendly that just does this one thing and focuses on that. Or Close that says, we're just here to help you close sales. We're not here to also do your marketing. And And all that. And that's actually really a good way to think about it because on the, we just do one thing really well, I think there's incredible opportunity for that hustler mode entrepreneur to come in and do the one thing. And then later if they decide that she wants to go off and do everything, there's an opportunity to do it. But at least you do the one thing really well. And that brings me then to AI where you have a few players who are like OpenAI with ChatGPT who can do everything. They can be your therapist and they could be your writing partner and so But you're right, I've been trying ChatGPT for a journaling app and it's really good, but it's not as good as a really good standalone journaling app. And it's not as good for other things. I can't think of them right now, to be honest with you. Oh, I know what it is for, like sales, for sales follow-up. It's not as good for me to take all of my stuff, all my transcripts and say, now gimme feedback on it. I actually do really prefer Grain, which is good for that.

Yeah.

So that's an interesting model. So then let's talk about you adding AI to Close. How do you do it without infinite resources and without ending up being the everything app?

Yeah, I think I'm more excited than ever about AI. I know that a lot of people are, but also I know a lot of founders, especially the founders that are sort of more bootstrapped, they're really scared about, hey, you know, Will there be space for small players? What if just like one app does it all? A friend of mine is like a total maximalist. He's like, there's only gonna be a text box that exists in the future and it will do everything. You know, you're just gonna say, build me Microsoft and it's just gonna do every product under the sun for you. I don't quite buy that world. And so in my mind, Giving, if you give everybody a superpower like AI, now our software can be smarter, can do more, can take more actions, can be more powerful, and we can move much faster in building things, right? And the value of building things or building features or adding pixels is going down as the ability to do that is exploding. To me, this is an exciting opportunity because now again, your level of taste, your level of creativity, Your point of view now are amplified in a sea of people that when everybody can do something, everybody will do the same thing enabled by AI. And so there's always gonna be value when you zig when everybody else zags. That's gonna grab attention as long as humans are part of the economic world. That's always gonna be great. And for us, what that means is just one example, a lot of companies are gonna be focused on the outbound motion and helping sort of you have a virtual SDR that Spams people around the world nonstop to get you some appointment. And we go, well, that's not really the world we want to build. Also, I believe that if you give everybody infinite AI SDRs, we're going to build a counterreaction to that, right? Like I cannot get infinite calls and emails every single second, right? That will break me. So then there's going to be services that stop that from happening or protect me from that. So instead of going cat and mouse and instead of doing all that, What we do is we focus on the inbound motion. Never again will you have a missed call. Never again will you have a missed or forgotten opportunity or email. Never again will happen that the inbound, the people that showed an interest to you today or 10 years ago go cold and forgotten because you're just a, you know, a small team of 4 or 5 people.

Right.

And you're just like, what do we do? We go after new opportunities because we forget the old ones that came to us because we disconnected with them. So Close will handle your entire inbound flow, will warm it up indefinitely, keep it warm or reheat it for you, find opportunities to connect with people that showed interest, tried your product, had a problem that they thought you might be able to help them, and focus you on just having qualified, high-intent opportunities on your calendar to talk to, solve problems with, Without needing to work this hard on it, right? Like without having to manually set up 1,000 systems and invites and calendars and tasks. Close is gonna manage your entire inbound funnel for you and it's gonna eliminate, I'm not good at selling. I forgot to get back to them. I didn't follow up. I didn't respond to this missed call. I didn't answer this email. All that will go away as a problem. And to me that's really exciting because like half of the small businesses that start 5 years later go out of business. And a significant amount of them is not because their product or service is so much worse than the competition, it's that they just don't know how to acquire customers, how to sell, how to close these deals. That's not their expertise and strength. And I think that we'll be able to make a big difference in a very opinionated way for a very specific customer base in ways that will make their life much more fun.

It is really hard to get back to people to not miss opportunities. I love to get back to people who I've talked with, had a great conversation, wasn't the right time. I don't move on to the next customer because I don't care about the previous one. It's because there's so much in that previous conversation bucket. It's people who emailed and didn't show up. It's people who got on a call and they were clearly not the right fit and they didn't even know what they were doing on a call. It was an accident or they booked using the Calendly, which, whatever. Um, that's the thing. All right. I get how you're getting that. What do you see on like the small end if someone were going to Say I want to build just a simple individual tool, almost like a wrapper. Do you see wrappers for AI being useful? Do you see sales AI wrappers being useful? Is there business here?

I think there's business everywhere. I think that we overcomplicate and are overly scared. Now I'll say this. I think that what we should all focus on is always who is my customer? What are their problems today? How can I uniquely help solve these problems in some way? Like, do I have an idea? Do I have experience, expertise, an approach? What is it? And then maybe it can be productized. Maybe I just use AI as sort of a way to scale the services piece of what I do, right? Or scale myself. Or maybe I built tools or a tool, a wrapper around something that's for a very specific target niche. And the way I reach them, the way I talk to them, the way I present and package it is what stands out. Now, Some people will say that will not be very defensible or not defensible forever. That's probably very true. I think the thing that's more true than ever now, and it's been true for a very long time if you paid attention, is that the sort of the— when you hit product market fit in whatever you're doing, that that's not forever. It used to be that you could hold onto that for a pretty long time, and that time is shrinking, just continuously shrinking. And with AI, maybe it's shrinking To you found something that's really, really awesome. Maybe you get like a, just a couple of months of that and then it disappears if you don't reestablish it, if you don't continuously reestablish it. And so you'll have to just be better at, you know, forever adapting and reestablishing product market fit as the world is changing so quickly. And that will be much more normal than it used to be. Now, back in the day, somebody would tell you, well, if you cannot defend this, you know, unique approach that you have that resonates for a couple of years, then it's not even worth doing. But I think that will go away and people will survive and thrive that are much more adaptable because when there's a lot of change, you know, the ones that are most adaptable will win ultimately. I think so adaptability will become a much bigger part of like how to be successful in business. And worrying about what may or may not happen in a future we can all quite not imagine or totally grasp is, I think, a way that a lot of would-be entrepreneurs are wasting their time. Just find something that delivers value today, do more of it, and stay in the mindset that you're gonna lose that. If you found something that really works, don't enjoy it too much and just expect to lose it and have to Yeah. refine it in some other way. If you can have that mindset, you'll be fine. Even if you do something that just, just in quote unquote, a wrapper, there's a lot, there's riches in just wrappers today. Maybe they will be gone a year from now. That's not gonna be an opportunity anymore, but I wouldn't worry too much about it. Just try to find something that's valuable and resonates right now, and then get comfortable with the fact that no matter how great the thing is that you figure out, it will go away and you'll have to figure out something else.

You know, the app I think I was thinking of as the example for that is VoicePen, where you could go to the webpage and people were telling me about this a lot last year. I'm pretty sure this is the story. You'd go to VoicePen, you could just talk into it, it would transcribe what you needed. And then I think that they, that now every tool can do that. Like there are tons of them, but they've moved on where they are built into an app, and they also work with, um, what is that, Apple Vision and all this other stuff. So that's, that's what you're saying. You're saying, look, find the thing that's killer for today and build on that. Don't worry about whether it could survive for the next 10, 20 years and just keep iterating and changing. You used to talk to your customers a lot to figure out what they needed and how to iterate. Now that you've gotten bigger, how do you understand what you need to do at Close to keep Iterating towards what they need?

Yeah, there's no substitute for talking to your customers. That's one of the biggest— that's a learning we constantly have to relearn. It's sort of like with workout routines, I keep relearning, keep it simple, right? I mean, I keep making things too complicated. I keep being too ambitious and doing too much workout, too many activities, too many things until then I get injured or I get overwhelmed and I get out of my rhythm and then I come back to this realization of, Dude, you try too much. Just keep it simple. Talking to customers is one of those things. Even I, and I've preached talking to customers for many, many years, and then I still, as we grew and gotten bigger and bigger and bigger, there's a natural gravitational force or force that pushes you away from your customer the bigger you get. So you have to consistently fight it. If you do nothing, you're gonna be pushed further and further away. Your understanding of your customer is gonna be diminished. And I went through this a couple of years ago.

Yeah.

And over the last 2 years, I had to work my way very hard back to being just more consistently closer to my customer and reestablishing intimacy. Right now I do it by talking to a customer every single week, right? So I have a customer interview.

One customer a week. That's enough.

One customer a week is plenty if you have, you know, 20, 30 years of experience in your customer's domain, like selling, being an entrepreneur, small business owner and all that. Like I've, Tremendous amount of experience. And when you talk to people with a level of skill of asking very deep, very good questions, seeing patterns, this is like many, many decades of building up. When I first started, I would talk to customers for 5 hours a day. Like I'd just call every single trial user.

And what do you ask now that allows you to get so fast?

I think that, I think that I'll ask people what their current biggest worries are like, what is right now? What really worries you? What is the biggest problem that you have? What is the biggest challenge that you're excited about? And when I get answers, it's much more just like you being great at interviews. It's much more about hearing, hearing where to dig deeper and where to move on. And some people, when you're, when you start out, you can either do one or the other. It's more formulaic, right? You're like, either ask 3 follow-up questions to everything and then you just go and ask lots of follow-up questions. Or you just take the first answer and you run with it. But over millions of these conversations over, you know, maybe not millions, but tens of thousands, you develop the pattern recognition, the insight, the gut, and you just know when to lean in and go, whoa, whoa, whoa, whoa, let's go back. Explain this to me. This makes— I don't understand this. What is this? Also, you get pattern recognition much faster. You know, I talk to 3, 4, 5 customers and I quickly can see sort of a common theme and then we can email 1,000 customers a survey to see, is it really hitting or is it maybe, you know, an error or a distortion in the overall pool of customers? I've just gotten better with experience, but even doing one customer call a week when you are having 100 employees, you've been in business for 13 years, you're at $50 million, it's not easy. It's a fight every week. It's a fight to make sure that call happens, that call doesn't get rescheduled. that doesn't get deprioritized because quote unquote more important, more pressing things are coming up.

Mm-hmm.

And I had to work really hard to get to this routine. I'm pretty proud of it because 3 years ago I talked to a customer every quarter, right? And it was way too little. And I always had felt that guilt. I'm probably not doing enough of this. I should be doing more of it. Just like somebody that's overweight that's like, ah, I should go to the gym more and eat a little healthier, but I couldn't get myself to it. And I've very, very slowly, fought my way back to talking to a new customer every single week, and that can be enough. Now, if when I started, I called every single trial user and I would talk to customers, you know, most of my day, but 13 years down the road, this can be quite a lot if you do it right.

All right, 2 other topics. I know we've got a lot to cover, but we'll do it quickly. The first is you did make the leap from service to a software company. I've always admired that you did that, and it always seemed like an easy thing to do. You do some service because you don't, it doesn't cost much money to do it. Your customers pay you week to week, and in the meantime, you're learning their problems and you're able to figure out what to, what software to create that will solve it better than humans. But it's not that easy. Most people who run service-based businesses end up getting so sucked into the day-to-day work that they can't even get another client and they're afraid of getting another customer. What did, what did you do to give yourself space to create software?

I don't think that we necessarily super strategically figured this out ahead of time. In hindsight, I can point to sort of why it worked for us. I think one, we did have product talent on day one. My 2 co-founders were engineers and product people. And at first we wanted to build a product company that didn't work. And then we shifted to services and we're like, what do we do with these, with this engineering talent as we're building services? We're like, well, we'll build our internal tools that will help us do the services better. That played a huge Part in this and made a big, big difference. The second thing I'll say is that we had the freedom to really and truly build for ourselves and build something that really mattered. And we were not in a rush. A lot of times I, I, I've talked to so many founders that run a services business, have the ambition to become a product business and ping me because they hear about the story of Close. And I tell them, your biggest problem is your eagerness to get to product really, really fast.

Yeah.

That's what's in your way because your eagerness will lead you down seeing opportunity where there isn't any, or believing you have product market fit way ahead of time. You're just too much, too invested in wanting to switch as quickly as possible to a product, and then you'll make it so when you don't really have something that works. So you have to be, when you do services and you have the ambition to go to product, you just have to be patient and really, really honest. And it's very tough to do. We had the luxury then when we started, we had the product engineering resources and we were not in a rush. And it took us like a year or so to realize, oh wow, we got something here. We think this is really, really good. But we were not, we didn't start and say, we have 6 months, we need to build a SaaS product. We need to get into, because when you go, when you put that pressure on you, oftentimes you're just gonna go too quick. And you're gonna have, you know, rose-painted glasses on or whatever it's called where you just gonna assume, oh, this is great and people love it even as the responses are maybe a bit lukewarm.

But, but then to find the time, is it that you're saying I had these 2 people who are engineers, they weren't in the service part of it? It is.

Yes. Yes, I do have it.

They weren't talking to customers, they weren't building forecasts. Got it. All right. And the previous company that you launched, it was Elastic Sales and you and I had talked about Elastic Sales. I didn't realize there was a company before that. Was it SwipeGood?

Yeah, it was Swipit.

A charity microdonation startup founded around 2010 that rounded up purchases to donate spare change. All right, I see that. All right, final thing. Now that we're all into sales, everybody's recognizing that they're in sales. I want some tips from someone who's seen so many salespeople, and I've got a good one that you guys already wrote on your blog. I think anyone who's reading this should go check it out, which is To, to make calls as quickly as possible. Your team talked about how when someone was on the site and they registered, they did a trial, they got their phone number, and as quickly as possible they would call them. And I love this one line. It stuck in my head because this is the experience I wanna create for my customers. They said customers would pick up the phone and say, I feel like you read my mind. Like, how did you know that I needed you right now? The only other company that I saw that did that to, for me is RingCentral. I'm going to, to, uh, Sydney, Australia.

Yeah.

And I need to call Australia. It is a pain to call. Verizon's not letting me call. Google Voice is not letting me call. I finally said, okay, RingCentral will let me call. I went to their site. It's a very 1990s website, to be honest with you. Their phone was good. And as soon as I got in there, I got a phone call from someone. And then later that day, I got a call from someone and they took me from a free trial to paying for 2, uh, 2 users before the end of the day, because they were so on top of it. And I kept thinking, I don't want to talk to you. I'm busy. But I need you. And they were great. Give me more tips like that. I just, I just answered the first question, but give me more tips like that that you've seen in sales.

Yeah, I think this comes back to doing simple things that are hard to do consistently. And hence most of your competitors won't do it. And there will be a tendency to not want to do it yourself because there's gotta be good excuses. Ah, we don't have the time. We don't have the money. We know this would be good, but we can't scale it. When you have these things, when you're like, I know this would be good, but it can't be scaled. So instead of eating broccoli and working out, I'm just gonna try to buy some magic pill that will make me buff and perfect and healthy. That's when you know you're on the right track, right? So this could be things like call every person that shows any kind of interest as quickly as possible, and you'll blow people's mind. You'll make people go, oh my God, nobody else. Nobody else reaches out. Nobody else gets on the phone. For us, another thing that we did that really made a huge difference was we said, hey, how is it that all SaaS companies have terrible support? I'll tell you how it is because nobody cares about support. You know, they're all like, let's build the product and let's sell it and market it. Let's scale and grow. And then it's like, well, but users will have questions and problems. What do we do with this? annoying thing that people have problems. Well, we'll have to deal with it, but let's deal with it in the most cost-efficient way possible. And let's make it the least priority because it's the least exciting thing. We took a totally different route. We said, well, we have a problem. When I have a problem, I want a smart person that's experienced and knows how to solve my problem to answer me. I don't need an answer within a second, but I need a good answer. And I don't want to talk to people that I don't believe have any clue About the product, any clue about myself, and are just their busybodies, you know, wasting my time to discourage me from keep emailing them with my problems, right? Like, I don't want that. And so we hired super technical folks that were much smarter, much more expensive, and we told them, here's your guideline. Don't respond within 2 seconds. Don't make sure we cut support. No, here's what Here's what you need to do. We want you to answer as completely as possible with as little fluff and bullshit in as little back and forth as possible. If it takes you an hour to research the problem, do it, right? Do whatever it takes to solve the problem. And one of the big, one of the parts of the business that gets the most love still today is our support team. People like, I have walls and walls every day of emails where people go, oh my God, your support just saved my life. Right. So, and there's many other areas like just looking at opportunities where you can stand out. This is a support, not a sales tip. So maybe I'll end on another sales tip when it comes to—

Yes.

I'll tell you one thing that you need to do that other people are, you know, or less people are gonna be willing to do is you need to make sure that once you've had an interaction with somebody, that you just never stop following up if it was a great fit, even if they didn't buy your product, right? Like it's the little things. Can you 3 months later, 6 months later, like once a quarter, send a quick note? Andrew, I'm still thinking about you. You know, last—

How, how do I get to do that? That's a lot. That's a lot.

But today there is technology. Close can help you. There's other tools that can help you. It's not that difficult to do. I know that it's like, oh my God, this is gonna be too much. Not if, of course, if you do it with anyone and everyone, yes. But if you only do it with qualified opportunities that you didn't end up closing, but people you liked, people you try to close, maybe the ones that broke your heart the most, right? Like where you're like, oh my God, it's such a bummer. Yes. It's not gonna be tens of thousands. Even if it's hundreds, you can use a tool like Close to keep track, to have reminders every 3 months. You can even subscribe them to a follow-up. Secrets, but even if you don't, one day a month where you spend 2, 3 hours to go through a list and send in a quick text message, right? You can do that in Close as well and just go, Andrew, I'm still thinking about you. Hope everything worked out with the solution you picked, but if not, I'm always here wishing you a sunny day wherever you are and have fun with your chess game today. What's the newest and greatest? Like that takes a couple of minutes.

That's the thing. Just follow up with them and send the message that's like that. Not even no substance beyond thinking about you.

No. But if you do it once, twice, if like 2 years happen and you still do it, I will now remember you. I will love you so much. You stand out so much because nobody does this. I'm gonna be like, someday I need to help Andrew. Like, we need to buy from them. These guys are on another level. And your reaction at first is exactly why this works. Your reaction of going, oh, how do I do this? This is too much. This is— I cannot handle this. That's bullshit. I mean, it is not too much.

Yeah.

If it is too much, you're so successful, maybe you can hire a bunch of people to be doing this, but it's not too much. And maybe you cannot do with everybody, do it with the best ones. Do it just with, you know, just follow up with 10 folks every quarter that you think could really make a difference. Uh, it's not too much. And it's one thing that everybody thinks it's too much. So if you push through that fear and you do it and you do it not just once, twice, 3, 4 times, I'm telling you all kinds of incredible things will come your way. Deals will come your way, customers will come your way. That's how you win.

That is a really good point to end on. I actually, we had a conversation internally with a few, with a few people about how often should you follow up with someone who expressed interest but then kind of disappeared. And Jesse, my business partner in Bootstrap Giants, just shared his email screen and I, I would never do that. I don't, I don't know how he's not afraid of sharing private stuff, but he goes, well, here, look, look at one from Ampush days over a decade ago. I kept messaging this person and saying, So are you interested? Whatever. Are you interested? Like, it wasn't this empty, but it was one sentence to say, are you interested? And then he finally said, uh, a no response isn't a no, right? And then the person replied back and he goes, no, hard no. And he accepted it. And then Jesse went and he found another message where he did that a few times and the woman came back and did sign up for a really expensive project. And I realized in that moment, ah, I don't care about people ignoring me that much. I thought maybe it was gonna look weak or desperate. And his point is right. He's expressing that you're interested in working with someone at that level who's going to ghost you anyway. Not desperate. What you're talking about makes me feel especially good. I do like following up with people. I do need a better, a better process for staying on top of them. All right. I think we've covered a lot here. The big story that we did not cover that happened is you guys are now the owners of Close.com. So now I don't even refer to you as like Close.io or Close.com. It's just Close, which is a little confusing because if I talk to ChatGPT about you, I've gotta make sure to say Close CRM. I talked to other people I need to make sure, but what a baller name, dude. How much did it cost you to get Close.com?

It's a good question. I don't even know. More than half a million for sure. But can I tell you something about that? Because that's what we should end on, 'cause this is a great story and follow-up. I knew the guy that owned Close.com when we launched January 2013, we were Close.io and I knew him and I pinged him and said, can I get the domain? I want the domain. And he said, no, I'm building a social network that's mobile-focused and, you know, thanks but no thanks. You know how many years of follow-up it took before we could buy the domain? It's 6 years. It was like 6 years of me following up twice a year. How's it going? Still nothing is on Close.com. What's going on? He, his first startup didn't work. And then he was like, no, I'm an investor in a startup and they're gonna use Close.com. But if they don't, maybe one day. And then like many, many years later, he was like, I pinged him, hey, still nothing on Close.com. We really would love to have it. And he went, you know what? Fuck it. Like I, it's so many years, nobody's using it. All right, let's make a deal. And we made a deal, right? And it, and it proved to be a pretty great deal for us. But it's another example of like, I, it took many years of following up to stay top of mind and to finally have the right moment where he was willing to sell.

That is a great place to leave it. And anyone who wants to can go check it out at Close.com. Your software is beautifully elegant. It's designed to be useful and I can see I can see why you've done so well, but I had no idea you did that much revenue. I had a different number in mind. This is what proves that ChatGPT is not right. I asked it and it gave me some number that was way lower. It was like $20 million.

Congratulations. Yeah, those— thank you so much. This is probably the most surprising thing that I get when I talk to people. People are always like, what the hell? I thought you guys were way smaller than that.

I know. You know what? Because it feels like we're looking at a very small number of companies when it comes to CRM. And the rest feel very nichey, but I didn't realize that the nichey could be this big, that there's so many other people like me who are thinking, I just need to make calls. I don't need all this other nonsense. By the way, you are in Greece right now. I'm in Austin, Texas. I've gotta tell you, right outside my window, the fricking fox— I've got some property here. The fricking fox is getting chased by a deer because this is the time of year where the babies come out and the babies are tiny. The moms hide them from the de— from the fox. I just saw one. I've gotta keep a camera out on the wildlife outside my window, dude. Or better yet, next time you're in Austin, come over here. We should do a dinner together.

Absolutely. And if you catch it on video, send me, uh, send me a, a, a text message. I wanna see it. Because when you started saying that the deer's chasing the fox, in my mind I'm like, the deer's chasing the fox? Did I hear that right? I didn't know that was happening.

But it's a mother. The mom. Oh, it's a mother. I will. All right, brother. Thanks. Awesome. Bye everyone.

Thank you so much. Bye-bye.